Nestle pushes into China faux-meat market to spur sales

Bloomberg

Nestle SA is jumping into the fake-meat business in China, seeking to revive weakening sales there by grabbing market share in the nation.
The Swiss company introduced a range of plant-based meat alternatives in China under its Harvest Gourmet brand.
Six options including kung pao chicken and braised meatballs will be available later this month on Alibaba Group Holding Ltd’s Tmall online platform and in its Hema supermarket chain in Beijing and Shanghai, before being rolled out more broadly.
The food maker has a factory in the northern Chinese city of Tianjin that will make products such as faux burger patties and meat mince for restaurants and other food service providers.
“The food sector is undergoing a quiet revolution as healthy, nutritious and environmentally friendly foods are gaining an increasingly large share of the market,” said Rashid Qureshi, chief executive officer of Nestle’s Greater China Region, in an email.
Nestle is the latest company eager to tap the vast Chinese market, which accounts for 27% of the world’s meat consumption by volume.
The country is emerging as the best opportunity for the likes of Beyond Meat Inc and Impossible Foods Inc after the coronavirus pandemic wiped out restaurant sales in the US.
If foreign companies can win over even a small fraction of China’s 1.4 billion people, the rewards could be massive.
Nestle’s meat-alternative push in China comes as the company has seen business slip in its second-biggest market by revenue.
The company last month agreed to sell the peanut milk and canned rice porridge businesses of Yinlu, which faced sluggish growth a few years after Nestle bought it in 2011.
Nestle also saw its share of China’s infant formula market drop to 12.8% this year from 13% in 2019, according to Euromonitor International.
The Swiss giant has been accelerating a global expansion in plant-based meat substitutes, rolling out products through its Garden Gourmet brand in Europe and Sweet Earth in the US. It reported double-digit growth in sales of vegetarian and plant-based products for the nine months through September.
While Nestle already sells Harvest Gourmet meat alternatives in Australia and New Zealand, rivals have a head start in China.
Beyond Meat announced plans for a major production facility in China and has deals for its products to be sold in Starbucks, KFC and Pizza Hut outlets in the country.