Understanding the Chinese market

17 Nov 2017

The announcement in May last year that Meatco had received CNCA approval and registration as an accredited beef exporter allowing Namibian beef to be shipped to China, could not have come at a better time since we were in the midst of a severe drought.

However, according to the Director of Veterinary Service of the Ministry of Water, Agriculture and Forestry, Dr Milton Maseke, they received a revised Memorandum of Understanding (MoU) from their Chinese counterparts containing some changes which are currently being reviewed.

The MoU now states that no animal disease, such as lumpy skin disease, may be present in a specific area for at least 12 months or else that entire zone will not be allowed to export, and not the entire country as was recorded in the previous agreement.

Dr Maseke is in the process of clarifying with his counterparts what is meant by “zone”. How is a zone determined? Is it in terms of the farm of origin or an entire region where the disease could for example, be detected?

Chinese consumers are currently demanding products that are associated with what Jeffrey Towson, professor of investment at Peking University, has termed “premiumisation”. This refers to products that Chinese consumers describe as exclusive and healthy.

Beef falls into this category because it is the kind of meat that not all Chinese people can afford. Beef is commonly known as Kuo ren de rou in the streets, which when loosely translated means rich man’s meat.

Competitive positioning

Australia, Brazil, Uruguay, New Zealand and Argentina are China’s leading suppliers of beef. This means Namibian beef will be entering a market faced with stiff competition.

Better days are ahead for Namibia’s industry, if – and only if – things are done correctly on a consistent basis.