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Chinese households lose their taste for Australian dairy products as souring relations hit sales
- Market share of foreign milk brands on Tmall has declined to 23 per cent this year, versus 35 per cent in 2019 and 52 per cent in 2016
- Nationalism cited as key reason for weaker sales of foreign brands, says Mark Tanner of Shanghai-based market tracker China Skinny
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Foreign milk producers are losing tremendous ground in China during the coronavirus pandemic, as nationalistic fervour influences sales amid souring relations with the United States and Australia.
Overseas brands accounted for 23 per cent of sales on Tmall from January to August, according to the latest dairy tracker report published by China Skinny. Their share on the business-to-consumer online platform has steadily declined from 52 per cent in 2016 and 35 per cent in 2019, it added.
“We are surprised to find the stark decline since the outbreak, which bucks a trend of Chinese consumers’ rising milk consumption,” said Mark Tanner, managing director of China Skinny, a Shanghai-based market research firm. “Many foreign brands we talked to cited rising nationalism as the reason for the declining market share.”
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Fresh milk imported from Australia, for example, slumped more than 20 per cent in July, according to Chinese Customs data, against the backdrop of trade and diplomatic spats as China curbed the import of Australian barley, beef and wine products.
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Nationalism among consumers on both sides of arguments have risen with geopolitical tensions as Canberra called for an independent inquiry into the origins of the novel coronavirus and criticised a new security law imposed by Beijing on Hong Kong. China has accused Australia of working with the US to hinder its progress.
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