CHINA The COVID-19 pandemic has had a negative impact on world trade and while the effects have been felt in China, the country has emerged from the crisis stronger than most other nations. Against this backdrop, what is the outlook for the country’s edible oil sector? Gill Langham China is poised to be the one major economy to register positive growth in 2020 following a turbulent period globally due to the ongoing COVID-19 pandemic. The country will overtake the USA as the world’s biggest economy before the end of the decade after outperforming its rival during the global crisis, according to a report by the Centre for Economics and Business Research (CEBR). In its annual World Economic League Table published on 26 December 2020, the UK-based consultancy group said China had bounced back quickly from the effects of COVID-19 and would grow by 2% in 2020. This was a view shared by Alan Jope, CEO of consumer goods giant Unilever, who was quoted by The Guardian as saying at a Reuters conference on 13 January that the pandemic would continue to disrupt European and American economies during the first half of 2021.However, he said east Asian economies such as China and Singapore – which had effectively suppressed viral outbreaks – were almost back to normal. Looking ahead, the CEBR said it expected China to average economic growth of 5.7% a year from 2021 to 2025 before slowing to 4.5% a year from 2026 to 2030.
Other factors
The US-China trade war also hit global economic growth and led to a reduction in China’s purchases of US soyabeans. Tensions between the two countries were heightened by China’s implementation of the new national security law (NSL) in Hong Kong. China’s handling of the initial outbreak of the pandemic in Wuhan was also questioned by the former Trump administration and alleged human rights abuses in western Xinjiang province provoked international criticism. 30 OFI – MARCH/APRIL 2021
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Post-pandemic re Although most commentators believed that US policy towards China would be less confrontational under the new Democratic president Joe Biden, relations were not expected to revert to their preTrump status.
Covid impact
China’s post-pandemic recovery and palm oil demand were the themes of a webinar organised by the Malaysian Palm Oil Council (MPOC) on 10 November 2020. During the webinar, Zhou Shiyong, from Beijing Heyirong Investment Group, spoke about the outlook for the oils and fats industry in China. “Due to the COVID-19 pandemic, there are still a lot of uncertainties in our market and this will definitely have a huge impact on the sector.” Despite the uncertainties in the industry, Zhou said there had been little impact on total consumption. However, from September 2020 there had been a change in consumption structure. “During the pandemic, most people stayed at home so that’s why there has been an increase in the small packaged oils sector,” he said. “We have more consumption in food and less consumption in industrial processes.”
The catering industry had started to recover in the latter half of 2020, explained Zhou. According to local media, the catering business had recovered well, especially in Shanghai, Beijing and Guangzhou. However, in small cities the recovery had not been as rapid. Looking ahead, Zhou said he was “quite optimistic” about the oils and fats industry in China in the first quarter of 2021.
Consumption patterns
The rapid development of China’s economy and its effect on living standards had been a catalyst in the growing consumption of edible vegetable oils, according to an MPOC report on 12 January 2021. According to the China Bureau of Statistics, the per capita edible vegetable oil consumption had increased from 7.7kg in 1996 to 9.8kg in 2019. Soyabean oil was the most consumed edible oil followed by palm oil, rapeseed oil and peanut oil. These four major oils accounted for around 90% of the total consumption in China. While the household consumer sector preferred rapeseed oil and soyabean oil, the commercial and food industry sector
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17/03/2021 16:36:21
