Factors Behind The Changing Urban Consumption Trends In China’s Food Industry

The strong economic growth in China since opening up policy has contributed to significant shifts in domestic consumption patterns in the Chinese economy. The robust growth in domestic consumption is reversing China’s role from an export-oriented manufacturing hub for’made in China’ products to a growing domestic market for’made for China’ products. In particular, significant transformations have been observed in China’s agricultural sector and food industry. Hence, the objective of this paper is to understand the factors behind the current food consumption trends in China, and to provide potential opportunities for both foreign and domestic enterprises to successfully expand in the changing consumer market in the coming years.Section one introduces the development of China’s agricultural sector from the institutional reforms that began in1978, to the recent growth of China’s food industry. Section two examines the growth of domestic consumption in the processed food market with a focus on three growing sectors that include frozen products, processed meat, and dairy products. Section three studies the food away from home market, in light of the leading role played by fast food enterprises. Section four analyzes the four major factors influencing China’s food industry growth and consumption changes which include:increasing foreign direct investments, rising per capita incomes, continuing urbanization, and the issue of food quality and safety.