Though the pace of China’s economic growth slowed down in 2012, demand for high quality imported fresh deciduous fruit was not significantly impacted.
THIS REPORT CONTAINS ASSESSMENTS OF COMMODITY AND TRADE ISSUES MADE BY
USDA STAFF AND NOT NECESSARILY STATEMENTS OF OFFICIAL U.S. GOVERNMENT
GAIN Report Number: CH11845
China - Peoples Republic of
Marketing U.S. Fresh Deciduous Fruits in South China
Market Development Reports
Fresh Deciduous Fruit
Though the pace of China’s economic growth slowed down in 2012, demand for high quality imported
fresh deciduous fruit was not significantly impacted. In the first nine months of 2012, the import value
of fresh fruit imports from the world was on a steady rise, approximately up 33 percent up from the
same period in 2011. The consumption of imported table grapes was up 26 percent, while the value of
imported apples decreased 10 percent. However, U.S. table grape imports increased 44 percent, while
U.S. apple imports were up 2 percent despite a 19 percent decrease from the lack of direct shipments to
Shanghai as a result of stricter inspection procedures. Abundant domestic supplies plus increasing
imports from Chile, France, Peru, South Africa, and New Zealand have created a new competitive
market environment for U.S. fresh deciduous fruit in Mainland China. Record high retail prices for
several U.S. fruit and new China’s inspection procedures might limit further prospects of U.S. fresh
deciduous fruit exports in 2013.
As demand and consumption for imported fresh deciduous fruit is growing in China’s three major
regions: South, East and North. The well-developed South China market maintains stable growth due to
sustained promotional efforts and a 34-year tradition of consuming imported fruit. By the end of
December 2011, Southern ports accounted for 83 percent of China’s total imports from the United
States. All of the imported fresh fruit available in West China (Shanghai region) was transshipped via
Guangzhou’s Jiangnan Wholesale Fruit Market. Direct shipments to East and North China regions have
decreased dramatically in the 2011-2012 season due to various factors. In the past three years, producer
associations have undertaking aggressive marketing activities to help boost sales. Through a well-
planned series of merchandising and handling training seminars designed for traders and retail managers
as well as periodic in-store promotions, in 2012 U.S. fresh deciduous fruit exports sold in more
supermarkets and at a higher rate than ever before.
Stricter inspection procedures for direct shipments to East China and high operational costs generated
from informal transshipment channels stifled growth and made for more cautious and conservative
purchases. As a result, wholesale prices temporarily increased prior to the mid-autumn festival, although
prices later stabilized. Freight forwarding costs from Hong Kong also declined, nominally offsetting
price increases. Retail prices are slightly higher than last year.
Regional Market overview:
South China: The South remains the leading consumption market in China- holding its dominant
position for over the past three decades. In 2012, around 78 percent of total fresh fruit imports entered
directly through ports located in the Pearl River Delta. This does not include the transshipment from
Hong Kong. Although proximity to Hong Kong has helped enhance Guangzhou and Shenzhen’s role in
promoting imported fresh fruit in modern retail channels. Freshness, taste, price, and health benefits are
all key factors influencing consumer preferences when purchasing fresh fruit. Key consumption
markets in South China include major cities in Guangdong Province’s Pearl River Delta such as
Guangzhou, Shenzhen, and Dongguan with the highest consumption, as well as secondary markets such
as Foshan, Zhuhai, Zhongshan, Huizhou, Jiangmen, and Shunde. In addition to Guangdong Province,
U.S. fresh fruit sales in Fuzhou, Xiamen, Changsha, and Nanning have sharply increased in the past
three years. In South China, imported apples and grapes can be found not only in hypermarkets and
supermarkets, but also in smaller-scale fruit retail chains with many still being peddled in street stalls or
East and North China: The best venues for purchasing U.S. apples and table grapes in the East and
North are the modern supermarket outlets. In the last two years direct shipments to local ports were
considered a cost efficient option as transportation costs (from South China) could be avoided
altogether. However in the 2011-2012 season marketing year, direct shipments of U.S. apples to these
two regions dramatically declined mainly because local inspection officials were instructed by Beijing
authorities to firmly enforce policies restricting the entry of U.S. Granny Smith and Gala varieties into
the market. These two U.S. apple varieties do not have market access, however, in the past lose
inspection practices in China overlooked this reality for several years. In addition, traders in these two
regions did not purchase smaller sized U.S. Red Delicious varieties. Adding to this, the U.S. market
access license expired and the negotiation process has proven ineffective.
Sales in West China remain weak when compared to the other regions.
Wholesale markets: Guangzhou’s Jiangnan Fruit Wholesale Market not only serves as a transshipment
hub, but also a key national market index for fresh fruit pricing and demand. Other leading fruit
wholesale markets in China include Longwu in Shanghai and Xinfadi Wholesale Market in Beijing.
Many new modern wholesale markets are under constructions in secondary cities. With support from
China’s Ministry of Commerce, these markets will be the beneficiaries of subsidies designated for the
construction of refrigerated transportation and cold storage facilities.
Online retail, television shopping and group purchasing, which was last year’s new trend for
imported fresh deciduous fruit purchases in large cities has now plateaued. With sales fairly
stable in first tier cities (Beijing, Shanghai, Guangzhou and Shenzhen). With no clear dominant
national player, it remains to be seen how these retail channels evolve in the different regions of
Specialized fresh fruit chain stores in them major cities are expanding quickly and offer privately
designed gift packages to consumers. Delivery services and payments are received upon delivery
providing convenience to urban customers.
In order to maintain fruit fresh and to extend their shelf life, many industry-insiders are
increasing their use of cold storage management technologies and proper handling techniques.
There is a range of central government policies supporting the development for new investments
in refrigerated transportation and cold storage facilities. These supports come in the form of
grants, preferential loans and tax credits.
Requests for direct farm purchasing are on the rise. Professional wholesale markets handle large
quantities of imported fruits, while distributors collect various products and arrange for the
distribution to retailers and end-users. Some retailers indicate an interest in buying directly,
although it is questionable if they have the capacity (“relationships” at ports and know-how) to
handle this complex business.
U.S. Apples: China’s total imported apple consumption dropped 10 percent in the first nine months of
2012. Chile took the hardest hit-- a 22-percent decline in value when compared to the same period in
2011. However, U.S. apples maintained their market position in 2012 with a total sales value of $31
million, accounting for 39 percent of China's total imported apple market share. 87 percent of these
shipments were imported into Guangzhou, Huangpu and Shenzhen ports in the Pearl River Delta. Year-
round availability of Washington State Red Delicious apples have entered modern retail outlets and
neighborhood fruit stalls in China’s larger cities for years. Direct shipments to Shanghai fell by 19
In 2011, China imported $50 million-worth in U.S. apples or 43 percent of the total China imported
apple market share. In 2012, New Zealand and France provided more apples to China and together took
6 percent market share from the United States.
U.S. Red Delicious apples are considered a preferred choice for gift-giving because their shiny dark red
color and unique, uniform shape. Gala and Granny Smith continue play an important role in providing
more choices to consumers, although these two varieties are technically not allowed entry into China
through legally channels. Consumers in South China prefer smaller sized apples and the consumption
demand remains strong, while consumers in North China prefer larger sized apple with no visible dents
or imperfections. Consumers in East China purchase 88 heads red delicious apples almost exclusively.
New Zealand’s imports this past season provided alternative choices for local consumers, although the
quality of the crop was poor and priced higher than U. S. Red Delicious apples. To remain competitive,
traders and retailers have invested colorful packaging and promotional displays to differentiate
themselves from competitors and attract new consumers. The best promotion season includes national
holidays such as the Mid-Autumn Festival, National Holiday, and the Chinese Lunar New Year.
Marketing of U.S. Table Grapes:
In December 2011, the United States was the second largest table grape supplier to China, after Chile.
China imported $36 million-worth in fresh grapes from United States. In the first nine months of 2012,
these sales were up 26 percent from the same period in 2011. However by September 2012, for the first
time Peru and South Africa outpaced United States table grape exports. Although Peruvian grapes do
not have official market access, exports totaled to $57 million, up 44 percent from the same period in
2011. South Africa surpassed U.S. exports and is now the third largest grape supplier to China.
South China remains China’s largest fresh table grape consumption region, followed by the East and
North regions. South China accounted for 82 percent of China's total fresh grape imports ($324 million)
in 2011. By September 2012, South China imported $263 million grapes from the world, up 22 percent
from same period in 2011. A total of $30 million grapes were shipped from United States to South
China. Each year, over 80 percent of imported table grapes entered China through South China ports.
Demand for U.S. seedless varieties continues to increase even though retail prices may be much higher
than for seeded varieties. According to China Customs data, the total imported grape value from the
United States increased 44 percent in the first nine months of 2012. In South China consumers table
grapes are the favorite fruit purchased at grocery stores by local consumers. U.S. grapes are
traditionally consumed in their highest levels during the Mid-Autumn Festival (September) and
National Day (October) holidays, while Chilean grape exporters target China’s Spring Festival (January
Red Globe is the most popular seeded variety holding the highest sales volume. Most retailers offer both
imported grapes and domestic varieties. Although China produces Red Globes, U.S. varieties are firmer,
larger, and taste better than the local varieties. Other varieties such as Scarlet Royal, Crimson are
available in some niche markets in first tier cities. Thomson was replaced by a new Xinjiang Province
variety called “Pearl”. Though the grapes are smaller in size, the Pearl variety has similar Brix levels as
Thomson’s, but at half the price. According to the trade, the cost of importing U.S. seedless varieties
has also increased sizably.
The market situation in the North and East are distinct. North China is the key production region for
table grapes and the price of domestic table grapes is much lower than that of the prices for imported
grapes. Therefore many North China traders complained that they could hardly turn a profit on U.S.
table grapes. In East China more varieties are becoming available. Red Globe, Autumn Royal,
Thompson and Crimson are being sold in high-end supermarkets with an average the price around 20
percent higher than the price in the South. According to wholesalers, table grape’s sales performances
in East China are not as good as were expected by the trade.
U.S. Pears: In the first nine months of 2012, China directly imported $3 million-worth of pears from
the world, mainly from Mexico, Belgium and New Zealand. Though U.S. pears do not have an official
market access, they are readily available in markets in South China. The volume is still limited and the
quality is unstable. China also produces pears; some local consumers prefer crispy and sweet varieties
instead of soft varieties.
Marketing tips: Some suggestions for potential U.S. exporters who have an interest in entering the
China market include:
1. Identify reliable local partners including: importers, logistics providers and retailers in each
2. Assist and educate local partners on proper product handling
3. Understand consumer preferences, which vary from region to region
4. Enhance the image of U.S. fruits to differentiate from other competitors (this includes
5. Provide assistance with promotional activities
6. Strengthen cold chain management practices to increase quality and extend fruit shelve life