Food firms hungry for place at China's big table

Q4 As China continues to pursue high-quality development through a homegrown path to modernization, what is the vision for your company's business in the country over the long run? What business opportunities do you foresee emerging as part of the process of Chinese modernization?

CHEN: Witnessing China's high-quality development efforts, LDC is committed to growing alongside its partners in the country, and to meeting consumer needs through continuous innovation and an enhanced portfolio of quality products and services.

Chinese consumers expect a more diverse range of choices, with food safety and quality as their main concerns. Accordingly, we will focus more on developing nutritious products and ingredients through R&D and innovation.

After expanding our cooking oil range last year, we began distributing not-from-concentrate juices. Both product lines have gained traction among our customers and, looking ahead, we will extend our portfolio into instant coffees, plant-based ingredients and other product lines, continuing to serve customers with diversified and qualitative products.

ZHU: Our vision in the China market closely aligns with China's path to modernization. We aim to make greater contributions to China's pet food industry for positive, responsible and sustainable development.

We will continue focusing on the Chinese market and the needs of its pet owners with a consumer-centric approach by investing more resources in innovation and new product development, providing more and better pet food choices, and bringing peace of mind to pets and pet owners.

China's modernization path is driving significant changes in the pet economy. From our perspective, we see many opportunities with the market changes — growing demand for high-quality products and e-commerce opportunities using cross-border platforms and livestreaming channels. By adapting to these dynamics, we have more opportunities to expand our brand in the market.

VAN KARNEBEEK: Our future is closely linked with China and we are here for the long term. We believe that the Chinese economy will continue to grow, and so will our business in China. We have successful business operations in the bigger cities and are making every effort to penetrate lower-tier cities to ensure continuous business growth. As a dairy company with over 150 years of cooperative history, we have rich experience and expertise in nutrition derived from dairy. As the Chinese people attach more importance to health, I believe we have a role to play in providing better nutrition to meet their diversified demands.

COURTNEY: Our vision for the Chinese market will always be sharing the goodness of New Zealand farms through our market-led strategy. As China accelerates its modernization with a focus on high-quality development and the green transition, sustainability is a promising business opportunity. This aligns with Silver Fern Farms' goal to eliminate coal from our processing operations by 2030 and halve our emissions from coal in the next few years.

We will review our packaging and look at designing and launching environmentally friendly products to fulfill consumers' rising demand with our partners in China. Additionally, the fast-paced lifestyles and an insistent pursuit of healthy eating in China are driving demand for convenient yet quality dining options. There is potential in ready-to-cook dishes using our quality grass-fed red meats. We are working to innovate and diversify our product offerings, featuring premium grass-fed venison.

Q5 Could you share with us one or two of your successful business or personal stories in the process of growing with China?

CHEN: With decarbonization being a critical global goal, I would underline LDC's active efforts in leveraging green energy in China to reduce carbon emissions, supporting increasingly sustainable food and agricultural value chains. We have adopted the use of photovoltaic power in our industrial sites to reduce carbon emissions. In January 2023, our Dongguan, Guangdong province plant became the first factory to use 100 percent green power for production in all LDC global production sites. Most recently, we signed a green power agreement to cover 100 percent of energy needs at a food industry park, contributing to our commitment to reducing our Scope 1&2 emissions by 33.6 percent by 2030.

ZHU: Ziwi's growth in the Chinese market demonstrates how an overseas company is closely aligned with China's development. Since entering the Chinese market in 2016, Ziwi has achieved steady and rapid growth, becoming the leader in the Chinese wet pet food market in just five years. An achievement like this is unique to the Chinese market and would be hard to replicate in other markets.

With the significant development of the Chinese economy and the improvement of people's living standards, pet owners have become increasingly willing to invest more in their pets' health. As an ultra-premium pet food brand, the ingredients we use and our formula perfectly meet pets' needs with high-quality nutrition.

China's digital development has also created more opportunities, such as cross-border e-commerce, livestreaming channels and logistics services, enabling us to introduce products into the market more efficiently and deliver products to consumers quickly. China's modernization path provides Ziwi with these opportunities, helping us achieve rapid growth.

VAN KARNEBEEK: Twenty-five years ago, I spent two years working in China and have been to many big cities. It's nice to be back and see how much the country has grown and developed. I think there are three specific areas to highlight — first, the cities are much cleaner and easier to live in; second, how digital China has become. Today, China is leading in the world in digital tools to interact with consumers; and lastly, Chinese people take a deep interest in quality. These were true 25 years ago and are even truer today.

COURTNEY: The journey of expanding in the Chinese market involves continuously adjusting our market strategies to seek localization and adopting innovative technologies to connect with local consumers.

Recognizing the strong digital influence on Chinese consumers' purchasing habits, we've connected to them by launching various e-commerce sales. The Traceability Livestreaming, in partnership with three popular food and wine KOLs (key opinion leaders) who visited Silver Fern Farms' operations and spoke with the farmers, earned nearly 10 million views, reflecting the success of our engagement strategy.

Our success stems from a thorough understanding of the evolving Chinese consumers' tastes. As preferences become more discerning and shift to healthier lifestyles, we have seized the opportunity to promote our premium grass-fed red meat products. This success underscores our ability to deliver and meet the high standards of Chinese consumers, reinforcing our strategic position in the market.