Briefing: to spend $965 million on Thai fruit imports to drive growth

1 min read to spend over $900m on Thai fruit amid Alibaba food fight – Nikkei Asian Review

What happened: plans to bring RMB 6.5 billion (around $965.8 million) worth of fresh produce into China overt the next three years. In an agreement with Chinese supermarket chain Yonghui Superstores made earlier this month, the two companies will purchase fruit, mainly durian and mangosteen, worth RMB 5 billion from Thailand. also signed memos with several Thailand-based agricultural food suppliers to buy RMB 1.5 billion worth of fruit, including longan and coconuts, on its own.

Why its important: Imported fresh food is becoming increasingly popular with Chinese consumers. Figures from China customs show that it is on the rise: in 2018, fruit imports rose 26% year on year to 4.85 million tons worth a total of $6.9 billion, reported Yicai (in Chinese). Higher value-added imported fresh food presents growth opportunities for online retailers including Alibaba and as overall e-commerce growth decelerates. However, the lack of quality cold chain logistics hampers profitability, according to Everbright Securities cited by Jiemian, causing losses exceeding RMB 100 billion each year for the category.