China's FMCG market predicted to grow 3.4% in 2023

China's fast-moving consumer goods (FMCG) market is forecast to reach a growth rate of 3.4 percent this year, higher than the growth rate in 2022, despite a slighter lower forecast in 2024, according to an industry analysis.

According to the Kantar Worldpanel, which has used historical sales data for the last 5 years to develop its prediction on how the category will perform over the next 18 months, the FMCG market in China is likely to achieve a growth rate of 3.4 percent in 2023 which is higher than the growth rate in 2022. The growth rate in 2024 will be slightly lower at 2.4 percent.

In 2019, before the COVID-19 pandemic, FMCG reported a robust annual growth rate of over 5 percent in China but this more than halved from 2020 to 2022 as consumers reduced spending on social and beauty occasions.

The higher growth in 2023 is driven mainly by the rebound effect from a very low fourth-quarter period in 2022. This means that the sector's performance will be stronger compared to the Covid years but will not return to the pre-Covid levels, said the research.

For example, in the food & beverage categories, the research expects there to be fewer in-home occasions and will therefore see a lower growth rate this year and next year for these categories. However, some categories, like herbs, spices and cooking oils, are likely to maintain their growth.

wangzhuoqiong@chinadaily.com.cn