China's Food Industry Upgrades from Bigger to Stronger

In 2015, China’s food industry achieved satisfactory results. Although the Central Economic Work Conference put forward the concept of restructuring and development at the end of last year, the performance of the food industry throughout the year and the government’s measures for the food industry It has been shown that 2015 is the year when China’s food industry is poised to make a big turn.

Extraordinary figures for the year

According to data from the National Bureau of Statistics, from January to September 2015, China's food industry above designated size (excluding tobacco) accumulated a total of 744.206 billion yuan in main business income, a year-on-year increase of 5.1%, and a total profit of 458.83 billion yuan, a year-on-year increase of 11.9. %; The total tax amount was 231.36 billion yuan, an increase of 7.1% year-on-year.

From January to September 2015, the industrial added value (current price) of agricultural and non-staple food processing industry, food manufacturing industry, and wine, beverage, and refined tea manufacturing industry accounted for 4.77%, 2.14%, and 2.22% of the national industrial added value, respectively. The year-on-year increase of 5.6%, 7.1% and 8.0% respectively.

The growth rate of fixed assets has declined. From January to August of 2015, the food industry completed a fixed assets investment of 1,238.679 billion yuan, a year-on-year increase of 7.3%, an increase of 3.6 percentage points lower than the national average, and accounting for 3.5% of the country's fixed asset investment. From the perspective of the industry, food manufacturing investment grew fastest, reaching 13.9%; agricultural and non-staple food processing industry investment increased 7.1%; wine, beverage and refined tea manufacturing investment increased 2.3%; investment in tobacco products industry remained at Negative growth, with a growth rate of -16.8%.

Regional economic development is basically stable. In the first three quarters of last year, the top 10 food industry revenues were: Shandong, Henan, Hubei, Jiangsu, Sichuan, Guangdong, Hunan, Fujian, Liaoning, and Anhui. The total revenue from main operations was 5,349.036 billion yuan. Accounted for 65.8% of the national food industry.

The value of food exports declined. In the first three quarters of last year, the export value of the food industry above designated size reached 321.65 billion yuan, a year-on-year decrease of 2.0%. In the four major food industry sectors, the export growth rate dropped by 2 liter. Among them, the agricultural and non-staple food processing industry's export delivery value was 219.10 billion yuan, a year-on-year decrease of 2.5%; the food manufacturing industry was 81.97 billion yuan, an increase of 0.5%; the wine, beverage and refined tea manufacturing industry was 17.69 billion yuan, a decrease of 8.8%; tobacco product industry 2.89 billion yuan, an increase of 10.0%.

In general, the overall development of the food industry in China was roughly the same as that of industry and the country in 2015. The growth rate of major economic indicators stabilized, and combined with preliminary data for the first three quarters of 2015: In 2015, the value added of food industries above designated size in China The growth rate was about 6.5%; the main business income was 11.6 trillion yuan, a year-on-year increase of 6.5%; the total profit was 800 billion yuan, an increase of 5.5% year-on-year; the tax paid was 970 billion yuan, an increase of 4.9% year-on-year; the fixed asset investment 2 Trillion yuan, an increase of 7.3% year-on-year.

It can be said that in 2015, when the “Twelfth Five-Year Plan” ended, the development of the national food industry was stabilizing, and this trend of stability was improved under the pressure of a downward pressure on the domestic economy and a slowdown in growth rate. China The extraordinary achievements of the food industry.

Highlights lay the foundation for transformation and development

During the “Twelfth Five-Year Plan” period, under the pressure of declining domestic economic pressure and slowing down of growth rate, the food industry throughout the country earnestly implemented the Central Government’s principle of strengthening and improving macroeconomic regulation and control, adhering to the general principle of “stability for progress” and complying with market changes. We will promote structural adjustment, achieve stable growth in production, continue to expand industrial scale, continue to improve economic efficiency, optimize the organizational structure, and coordinate the development of the regional food industry, and the overall food safety situation will improve. The overall characteristics of the development of the food industry during the “12th Five-Year Plan” period: the growth rate of the food industry slowed down, the steady growth of benefits, the optimization of the corporate structure, the rapid growth of investment in fixed assets, the coordinated development of the regional food industry, and the rapid development of the overall level of foreign trade.

In 2015, when the "Twelfth Five-Year Plan" ended, China's food industry brewing the transformation, upgrading and development, showing new features:

The construction of the rule of law is based on completion. In 2015, it can be said that it is the peak year for the rule of law in China's food industry. Revised food safety law enforcement, "national food safety standards packaged drinking water", new edition of "beverage rules" national standard, "national standards for food safety food additives use standards" "pre-packaged special dietary food labels" "food production license management measures" A series of newly revised regulations and standards began to be implemented. In addition, a series of drafts of regulations and standards such as the “Implementation of the Draft Food Safety Law” have been issued. The promulgation and implementation of these laws, regulations, methods, and standards indicates that the legal system of the food industry in our country has basically taken shape. It is a future industry. Development laid a good foundation. At the same time, regulators at all levels also completed adjustments in 2015.

Food safety seeks for co-governance. The report on the work of the governments of the two National Conferences in 2015 proposed comprehensively improving the quality of agricultural products and the level of food safety, safeguarding the safety of food and drugs throughout the process, and putting forward new requirements for food safety. The Fifth Plenary Session of the 18th CPC Central Committee was held. The food safety strategy is expected to be implemented. The grand goal of building a well-to-do society and the five development concepts of innovation, coordination, green, openness, and sharing will have a profound impact on China's food safety. The "CPC Central Committee's Proposal for Formulating the 13th Five-Year Plan for National Economic and Social Development" was deliberated and adopted at the meeting, which specifically proposed the promotion of healthy China and the implementation of a food safety strategy. The new concept, new strategy, and new requirements for food safety, “party and government responsibility,” have strengthened the supervision of food safety at all levels of government, using the most stringent standards, the strictest supervision, the most severe punishment, and the most serious accountability. Accelerate the establishment of a scientific and complete food safety governance system, and lay a solid foundation for every line of defense from farmland to table.

Facing upstream, seeking integration. China's food industry has already formed a preliminary modernization scale and system, and China's agriculture has begun to show a shortcoming that is not fully connected with the food industry. In 2015, the problem of poor marketing of agricultural products still persisted. The incidents involving food safety, such as "rice adulteration" and "strawberry acetochlor disturbance," were related to the quality of agricultural products. The Central Rural Work Conference held not long ago pointed out that it is necessary to tap the potential of agriculture, promote the integration and development of the secondary, tertiary and tertiary industries (agriculture, industry, and service industries), make good use of rural resources, assets, and funds, and increase farmers' income through multiple channels. Many Chinese food production companies have begun to seek upstream integration with agricultural production. For example, dairy production companies are striving to upgrade the quality of milk and strictly comply with the standards in the rearing and processing stages. At the same time, in order to ensure the safety of upstream raw material supply, downstream companies began to try to control the upstream resources. For example, METRO employs professional companies to guide the farms to produce fruit and vegetable products for themselves to ensure traceability; the central kitchen company, Shandong Xinliangda, also owns its own vegetable farm; CR Vanguard has established its own fresh food distribution center.

Deal with the market, service innovation. In China, the online platform has become the fastest growing distribution channel. According to data analysis, the shift in consumer spending habits in China from offline to online has increased online food and beverage sales to 66.7 billion yuan in 2014, an increase of 49% year-on-year. In 2015, this figure will have no small increase. The implementation of a comprehensive two-child policy, 70 million people out of poverty, popular entrepreneurship, innovation and the "Internet +" strategy will promote the mobile Internet + food safety + agricultural innovation and entrepreneurship upsurge. In 2015, the food industry has involuntarily begun its practice of responding to market and service innovation.

Rethinking the New Normal Faces Multiple Tests

In the past 2015, the central government proposed the "new normal" economic judgment, and the new normal economy has also brought many tests to the Chinese food industry.

The test of the economic downturn. In 2015, China’s economic operation still faced many difficulties and challenges. The economic downturn pressure was high, structural adjustment pains appeared, production and operation difficulties of enterprises increased, and some economic risks emerged. During the "Twelfth Five-Year Plan" period, the total output value of China's food industry accounted for 12.0% of the country's total industrial output value, and 54 food industry enterprises with more than ten billion yuan have reached this level. This volume also bears tremendous pressure. From the data for the first three quarters of 2015, the growth rate of industrial production slowed down, and the added value of food industries above designated size increased by 5.1% year-on-year, which was lower than the national industrial growth rate by 1.1 percentage points and 2.9 percentage points lower than the same period of last year. The growth rate of fixed assets has declined, and the value of food exports has declined.

The harsh test of the ecological environment. In recent years, blue-green algae, desertification, water and soil erosion, sandstorm, and haze have repeatedly caused the deterioration of the ecological environment to continue to stimulate the attention of the people. In 2015, the Ministry of Environmental Protection pointed out that the ecological environment in some parts of China has shown a trend of improvement, but the overall deterioration of the ecological environment has still not been fundamentally curbed. These environmental problems have seriously affected the development of the food industry. At the same time, with the continuous development of the economy, 2015 was also the year of many accidents and disasters, and some food companies were also affected. More typical is the fire in the logistics and distribution storage center of Shanghai Jinlongyu Edible Oil in March, over a fire of approximately 9,000 square meters. Safety production has become a topic of concern for companies.

The test of the adjustment of the policy environment. In 2015, various regulations and policies were introduced intensively, and the corresponding supporting regulations and policies were not put in place in time. This has caused troubles for enterprises. The safety warnings for sales of high calcium milk in Huishan dairy industry in Liaoning indicate that how to standardize risk warning work and properly publish food safety information requires strengthened research and sound mechanisms. In 2015, there were three administrative litigation cases involving suing the Ministry of Agriculture concerning the disclosure of genetically modified information, which were accepted by the Third Intermediate People’s Court of Beijing. Regarding genetically modified foods, disputes have continued and there has been no consensus on all parties. Three cases have sought to use judicial power to clarify the truth. Obviously, it takes a difficult process to reach a consensus on the issue of genetically modified foods. In the case of “Poisonous Bean Sprouts” case, despite the first acquittal judgment, the law enforcement and judicial organs have unified understanding, properly handled cases and pending cases, how to fundamentally solve the “toxic bean sprouts” and similar problems, and still have A lot of work needs to be done.

The test of environmental change. In 2015, WeChat continued to become popular. "Eating strawberries is equal to chronic suicide" "Eating breast milk can fight haze," "Garlic can detect gutter oil," "vegetable oil cooking can cause cancer," "ham bacon = awakening," and other "food" rumors spread freely in WeChat's circle of friends. It is worth mentioning that these rumors have been packaged and the "credibility" in the circle of friends has increased. On September 29th, the China Food Piping Alliance announced the first phase of the food rumor list. “Maka is a 'magic imperative drug' and “eating crayfish equal to eating junk” and other five online rumours were selected. The proliferation of food network rumors has brought "security anxiety" to the public and it has also hurt the healthy development of the entire food industry.

Imagine being bigger and stronger is the direction

The recently convened Central Economic Work Conference put forward "understand the new normal, adapt to the new normal, and lead the new normal, and it is the big logic of China's current economic development during the current and future period," pointing out that in the opening year of the "Thirteenth Five-Year Plan", "supply will increase supply. System quality and efficiency, increase investment effectiveness, speed up the cultivation of new development kinetic energy, transform and enhance traditional comparative advantages, enhance the power of sustained growth, and promote the overall improvement of China's social productivity level." It is determined that 2016 will mainly focus on the five major tasks of “de-capacity, destocking, de-leveraging, cost reduction, and short-cutting”.

From the performance of China's food industry in 2015, we can see the future development of the food industry, that is, the transition from subsistence consumption to healthy and enjoyable consumption, from food consumption to food safety to basic food safety and health satisfaction. Change in food consumption diversification. Information technology, biotechnology, nanotechnology, new processes, and new materials have been transformed into new formats and new products. The historical opportunities for the globalization of “Industry 4.0” and “Internet Plus” will help the food industry form a new business model and social value realization model.

After intensive introduction of various laws and regulations in 2015, the legal construction of the food industry will surely begin to be implemented forcefully. Strict supervision according to law must be one of the most important tasks of the government. Using the power of laws and regulations to safeguard rights and interests and promote healthy growth must also be a new direction for each food company to explore, from playing with law enforcement to communicating with regulators. Avoid regulatory supervision and regulate development according to law.

Under the background of the central government's efforts to strengthen the macro-control of structural reforms on the supply side, in 2016, the huge Chinese food industry will have to find new growth points in the direction of the entire industrial chain. Stretching direction: First, integrate with modern agriculture, increase investment in the construction of raw material bases, and increase the intensity of primary processing of agricultural products; second, integrate with the food service industry and participate in the catering industry, logistics, etc. In the downstream industry, the end market is given more in-depth attention and interconnection.

At the same time, the leap in Internet technology, the predicament of an aging population, and the turmoil in the capital market ... all kinds of changes force the food industry to face new markets with a new perspective. More new thinking leads the development of enterprises, and more new technologies dominate the production of enterprises.

According to the annual average GDP growth rate of around 6.5%, and the food industry's average annual growth rate of 7%, the main business income of the “Thirteenth Five-Year Plan” will reach more than 16 trillion yuan. Structural adjustment and transfer are the unswerving development direction of the food industry. In 2015, the theme of the Chinese food industry is ready to go. In 2016, it was worthwhile to think about the beginning of the food industry.