China Food

How to treat the anxiety of Chinese coffee?

different from the nearly saturated coffee market in the developed countries of Europe and the United States, what changes are taking place in China’s coffee industry? How can the fast-growing dividend of the consumer end be transmitted to the upstream planting end? In the future, which direction will China’s coffee industry develop?

In China, more and more workers rely on coffee to survive.

Even the Wenqing front Douban is not free from vulgarity. More than 60000 coffee parties scattered all over the country set up a group with the slogan of “drink coffee today or not”. The slogan is “you can’t face life without a cup of coffee in the morning.”

In station B, a up owner named “big bowl latte” released a video of “you can make a cup of Internet red coffee by 400 laps”, with a broadcast volume of more than one million. Coffee themed videos and up owners are making coffee come out of the circle from station B.

However, it was a misunderstanding between Yunnan Coffee Association and Alibaba not long ago that made coffee a hot word. Now, the misunderstanding between the two sides has been eliminated, but the attention of Yunnan coffee has not decreased.

According to the analysis report on market demand and investment planning of China’s coffee industry in 2020-2025 released by the foresight Industry Research Institute, during the six years from 2013 to 2019, China’s per capita coffee consumption has been increasing year by year. In 2019, the per capita coffee consumption has reached 7.2 cups, with an average annual growth rate of 15%, far higher than the world’s average growth rate of 2%.

Different from the nearly saturated coffee market in developed countries in Europe and the United States, what changes are taking place in China’s coffee industry? How can the fast-growing dividend of the consumer end be transmitted to the upstream planting end? In the future, which direction will China’s coffee industry develop?

The great contrast of reality

Urban youth spend a lot on coffee, and coffee has become an important direction of entrepreneurship in the new consumption field in recent years. Last year, a new instant coffee brand won the sales champion of mixed drinks in tmall “double 11”, surpassing international brands such as Nestle and Starbucks.

Compared with the hot consumption and entrepreneurship situation in the downstream, the coffee planting industry in the upstream of China is bleak. More than 95% of the domestic coffee bean production comes from Yunnan. In the past two or three years, coffee farmers in Yunnan have been cutting down their own coffee trees and planting corn and vegetables instead.

In laoshuijingzhaizi, lujiangba, Baoshan, Yunnan, 60 year old Zhang Heyun has grown coffee beans for 40 years. Here, like him, there are more than 20 families who grow coffee for a living. With his 40 mu land, the total planting area in the stockade is about 700 mu.

According to the annual production of 200 kg of coffee beans per mu, the annual output of coffee beans in laoshuijingzhai is about 140 tons. This output accounts for only a few hundred percent of the annual output of coffee in Yunnan, just as Zhang Heyun is the epitome of millions of coffee farmers in Yunnan.

“Before 2011, the lowest purchase price of shelled coffee beans was more than 18 yuan per kilogram. In recent years, it has dropped to more than 11 yuan, and it also requires quality. Planting 40 mu now is not as good as planting 5 mu in the past.” Zhang Heyun commented on the new retail business that because the purchase price in some years is too low to cover the cost price, some growers would rather let the fruit rot on the tree than pick it.

Jingdata, a financial data research service platform, once estimated that in the whole coffee industry chain, the value contribution of raw beans in the upstream planting link is about 17.1 yuan / kg, the value contribution of baked beans in the midstream deep processing link is about 83 yuan / kg, and the value of the downstream circulation link has soared to 1567 yuan / kg. The profit distribution ratio of the three links is 1%, 6% and 93% respectively.

According to the statistics of the Ministry of agriculture and rural areas, in 2018, the total output of coffee in China reached 137900 tons, of which the output of Yunnan accounted for 99.55% of the national output. In 2018, the total output value of coffee agriculture in China was 2.043 billion yuan, a decrease of 22.98% compared with the previous year.

The decrease of planting area is traceable. In recent years, there have been a lot of accidents around Zhang Heyun. Because some farmers can’t earn money, they have to bear the pain of cutting down the coffee trees that have been planted in their fields for many years and planting other cash crops.

Obviously, the purchase price has become an important factor affecting farmers’ enthusiasm for planting coffee beans, but the dominant power of purchase price is not in the hands of farmers.

Because of the superior geographical conditions, lujiangba in Baoshan, Yunnan Province was the first trial planting base of Arabica coffee in China, but now it is still the export base of coffee beans. In the 1990s, with Nestle, Maxwell, Starbucks and other international coffee brands entering China one after another, Yunnan’s coffee planting industry once got more positive development.

But the two sides of things are also reflected in Yunnan’s coffee industry.

The rapid expansion of foreign brands, on the one hand, has brought a huge amount of purchase, which has played a role in promoting the coffee planting industry in Yunnan, and the planting area has continued to increase; on the other hand, the purchasing power of chain giants has also made the loose individual coffee farmers have no pricing power, and they are at the bottom of the whole industry value chain.

Problems in the industrial chain

If the coffee industry chain is roughly divided into planting, processing, baking, production and sales, it can be roughly divided into two ends.

The front end is the coffee raw material industry, which mainly refers to the end of coffee beans from planting to processing. Among them, raw coffee beans, like oil, belong to international bulk trade commodities.

The back end is the coffee commodity industry. The sales scenes are mainly online and offline, and the forms are mainly instant, instant grinding and hand washing. Now, there are many new subclasses in these three forms, such as Kawabata’s ear, three and a half tons of freeze-dried powder and yongpu’s cold extract, and so on.

As a native of Yunnan Province, Guo Lei, the brand leader of caffeic coffee, said bluntly when talking about his entrepreneurial experience that from the profit point, caffeic decided to start from the back-end coffee products. Among the coffee products, the three in one instant coffee, which accounts for the highest proportion of consumption, is a good market.

Although Nestle had already occupied half of the three in one instant coffee in China at that time, China Coffee still opened up the market through its cost advantage. At the best time of sales, the monthly sales of a 60 cent three in one instant coffee reached about 3 million yuan.

The success of Zhongfei made local competitors in Yunnan join in the market competition, but gradually, the competition began to deviate from the vicious competition dominated by price war. “At the most exaggerated time, they sold a dime a piece.” Guo Lei understands that if it goes on like this, not only will China coffee have no future, but the whole coffee industry in Yunnan will also be dragged down, and upgrading is imperative.

In 2019, with the development of domestic coffee towards high-quality products, caffeic began to transform from planting end to processing end, and then to brand positioning and packaging image.

At present, 50% of the products are instant products, and 50% of them are grinding products. Among the instant products, high-quality instant products replace the early three in one instant products, accounting for 95% of the total.

As for the coffee industry chain, Guo Lei, who started his own business after graduating from University, clearly knows what the problem is. However, Zhang Heyun, who has been dealing with coffee all his life, doesn’t understand why a cup of coffee in the city costs three or forty yuan, and the good coffee beans planted by himself can’t generate profits or even make him lose money?

In the interview, the new retail business review found that the vast majority of coffee farmers in Yunnan are in the situation of information asymmetry in the whole coffee industry chain

First of all, I don’t know how much market demand the coffee beans will have. I just plant them according to years of inertia;

Secondly, we don’t know what kind of coffee beans the market needs. From planting to picking to rough processing, all of them are the standard of currency beans;

Finally, they don’t know how to open up new sales channels except sitting at home waiting for buyers to come.

Go out of the development pain

At the other end of the mountain, the Internet is helping netsheng brands stand higher and see further.

In 2017, yongpu coffee decided to establish its own “shiduanzheng coffee farm” in Baoshan, Yunnan Province.

As a new and cutting-edge brand in the domestic coffee consumption field, yongpu coffee has become the No.1 brand of coffee liquid category with a total sales of 20.94 million yuan during tmall double 11 in 2020. And this achievement, also have a credit of Yunnan coffee manor.

“In 2020, our Yunnan manor will produce about 10 tons of coffee beans per year, all of which will be used to produce cold extracted coffee liquid. We have also clearly marked the origin of coffee beans.” Tiepi, the founder of yongpu coffee, told the new retail business review that although the contribution of Yunnan manor is small, accounting for only about 5% of the annual sales revenue, yongpu coffee will continue to expand the planting area of Yunnan manor in the future.

In terms of cost, Tiepi said that compared with the well-known Brazilian commercial coffee beans (those with SCA score below 80 are generally called commercial beans, and SCA is abbreviated as world Coffee Association), the quality of Yunnan coffee beans is good, but the cost is also much higher.

However, he stressed that the use of high-cost Yunnan beans, on the one hand, is to let more Chinese consumers know about Yunnan’s good coffee; on the other hand, he hopes to make some efforts in Yunnan’s coffee branding and industrial upgrading.

At present, China’s coffee consumption market is changing to the direction of high-quality products. Many high-quality coffee brands have emerged online and offline, such as Sandun and a half, Yingji, fisheye and maner. Many high-quality coffee brands have also begun to enter Yunnan, working with local manors and coffee farmers to create high-quality coffee beans.

This trend change actually provides a good opportunity for the transformation of Yunnan coffee industry, including planting industry.

At the end of last year, Zhang Heyun signed a cooperation agreement with a boutique coffee brand in Beijing, which is another boutique coffee bean business he has received since he cooperated with China coffee in 2019.

Although compared with currency beans, the requirements of quality beans are much higher, and it takes 35 days to dry them, the “purchase price of 40 yuan per kilogram is more than double the income of ordinary beans.” Obviously, Zhang Heyun is very satisfied with the price. Only when he mentioned how much the final profit would be, he was a little worried, “the beans have not been dried out, although he has a contract with the other party, but the money has not come in.”

Local boutique coffee brands such as seesaw have also entered Yunnan to cooperate with local manors and farmers. This cooperation is not only to purchase beans from coffee farmers, but also to guide them to operate according to the standard of quality beans from planting, maintenance, picking to peeling and drying, so as to help them establish the awareness of quality beans and master the operation standard of quality beans.

In addition, Alibaba, Jingdong and other domestic well-known e-commerce platforms have already gone deep into all parts of Yunnan, helping Yunnan’s coffee industry to upgrade and transform with the local government, Coffee Association and other organizations.

In July 2020, Jingdong Zhilian cloud (Pu’er) digital economy industrial park will focus on Pu’er tea, coffee and other characteristic industries, jointly build with the local government, and implement the “1 + 5” Pu’er digital economy upgrading action plan.

Look at Alibaba. As early as 2018, tmall launched the origin plan of Yunnan coffee and signed a strategic cooperation memorandum with Yunnan International Coffee Trading Center. In 2019, tmall helped local coffee growers connect with domestic high-quality roasters. In April last year, after Alibaba restarted the Chunlei plan, it launched the activity of “taste Yunnan coffee and gather Yunnan coffee growers” at a cost-effective manner. During the activity, the local coffee growers were able Sales increased 17 times year on year.

Not long ago, while exploring with 30 domestic agricultural academicians and experts how to combine agricultural high technology with digital technology, Li Shaohua, vice president of Alibaba group, proposed that the mode of helping farmers should be further innovated, and that the combination of high technology and data technology should help farmers achieve “double upgrading” from the planting end and production end.

In Yunnan, change has taken place.

At the end of the interview, Zhang Heyun told the new retail business review that he now has 4000 new coffee seedlings on hand and will gradually replace the coffee trees in his home field in the future. Now, he has cooperated with China and coffee to plant a boutique coffee tree “huangbobang”. Not surprisingly, the first batch of huangbobang beans will be harvested by the end of 2022.

“This bean is not red, it’s yellow.” Zhang Heyun’s words are full of pride and expectation.

Author: Tian Qiaoyun; source: new retail business review (ID: xinlingshou1001), reprint authorized. Joining the community: Cherry (wechat: 15240428449); business cooperation: Amy (wechat: 13701559246). high quality and original investment and financing events of inventory in 2020 sustainable wind direction of inventory in 2020 major events of inventory in 2020 technology hidden weapon of the most innovative concept beer in 2020 Pepsi nutrition incubator top ten shortlisted? Daily new products: Isee trends | editor’s | reader’s

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