Australia’s strong brands and reputation as a clean and green producer of food and wine are still desirable traits sought after in China.
Panel discussion–- Rebuilding relationships with China: Trade and investment opportunities in a revitalising economy
Albert Tse, Founder, Wattle Hill Capital
Paris Zhang, Executive Director, International Markets, Minter Ellison
Doug Rathbone, Chairman, Rathbone Wine Group with The Australian’s Senior Writer and Columnist Glenda Korporaal
April Huang, an executive at Hippo Fresh – a bricks and mortar retail chain owned by e-commerce titan Alibaba – arrived in Australia on Sunday. She has met with several companies including Woolworths, Chobani and JBS, and plans to hold similar talks with Blackmores and Swisse.
Ms Huang told The Australian’s Global Food Forum that Australian products were still in demand in China, given their reputation for high quality and food safety.
“The (Chinese) consumers really like food. For example dairy, milk, cheese, yoghurt; these are number one choices for them from Australia,” Ms Huang said.
“And of course wine as well as seafood. Australia has very good seafood like abalone, lobsters, as well as some fish – even salmon in Tasmania, and the cherry. Then there is Swisse and Blackmores, products for good health. So I think Australia has plenty of good products to stand for quality and safety.”
Australian food companies have been urged to take advantage of China’s reopening and improved political ties. The thawing of relations between Beijing and Canberra comes after Australian products, from beef and barley to wine and lobster, faced tariffs from China after former prime minister Scott Morrison three years ago spearheaded a push for an inquiry into the origins of Covid-19, cruelling a key Australian export market.
The trade tensions prompted Chemist Warehouse chairman and co-founder Jack Gance to say China’s love affair for Australian products is waning. Mr Gance, who oversees a business with $8bn annual sales, said Covid-19 lockdowns, trade disruptions, a lack of Chinese tourists and students coming to Australia and government policy had all hurt Australia’s reputation.
“It’s like if you’ve been separated from your loved one for two years. I think it takes a while to warm up to them again. And then sometimes you’ve got someone else that you’re in love with,” Mr Gance told the forum.
Panel Discussion: Understanding the Chinese consumer with April Huang, General Manager of Direct Import, Freshippo Will Zhao, Chief Executive Officer, Yaru Ventures with the Australian’s Business Journalist, Jared Lynch.
Will Zhao, the chief executive of Yaru Ventures, a firm that has led the development of brands into China and South-East Asia, disagreed. He said it was more reflective of a broader downturn in China’s economy, which is finally reopening after several years of pandemic lockdowns.
“I think generally the decrease in consumer sentiment towards Australian products is not isolated to Australian products,” Mr Zhao said. “I think the general downgrading in consumer spending over the last three years relating to Covid has got more to do with that than a specific slide of Australian products. Obviously there’s been politics in there but the general consumer sentiment towards the quality of Australian products has not deteriorated.”
Mr Zhao said that Penfolds could even regain its mantle as China’s best-selling wine when tariffs of more than 200 per cent are removed.
But Doug Rathbone, chairman of Rathbone Wine Group, said while China was a big market, he did not think the wine export trade would go back to the levels it was in the past.
“If it reopens, it will be an important market. It might not be as big as it was previously, but it also serves as a very important model (of what can be done),” Mr Rathbone told the forum.
Wattle Hill Capital founder, Albert Tse, said: “The underlying issues between the two countries are pretty similar to what they were two years ago, but the actual diplomacy has changed.
“The megaphones have been put down. I think when it comes to food and China, people need to remember that when China was subject to sanctions in 1959, Australia and Canada were the two countries that sold wheat to China during the famine, and that is etched in Chinese political history.”