Within 24 hours, a total of 428,000kg of durians were sold out on JD.com during its annual Super Durian Day, president of JD FMCG and Foods, Xiaosong Wang, told FoodNavigator-Asia. This is 30% higher than last year’s sales, where 330,000kg of durians were sold out in a similar promotion last year.
The durians, sourced from Thailand, were sold at 20% to 30% cheaper than the usual price during this year’s launch. For instance, a Monthong durian, meaning “golden pillow”, which weighs 3.5kg to 4kg, could be sold at RMB 139 . Its usual price is RMB 209.
Known as the king of fruits in South East Asia, the love for durian has spread to China. Overall transaction volume for durians on JD.com grew 11-fold between 2016 and 2017, the company said.
Although other durian products are also sold in China, Wang said that consumers prefer the durian fruit most. Durians are most popular in first and second-tier Chinese cities like Beijing and Guangzhou, but demand is growing in other regions where the fruit was not previously easily accessible, JD.com said.
It added that customers in fourth and fifth-tier cities make up 45% of JD.com’s durian transaction volume.
To prepare for this year’s Super Durian Day, JD has entered into an agreement with Queen Frozen Fruit, Thailand’s main frozen durian distributor, to buy a third of Thailand’s frozen durians. They are expected to import more than six million Thai durians.
Competitor Tmall had also launched a similar durian sale. In all, 80,000 Monthong durians, weighing a combined 200,000kg, were sold within a minute of the launch, Jack Ma, executive chairman and co-founder of Alibaba said.
Chinese customs authority revealed that over 250 tonnes of durian is imported every year , with the Ministry of Commerce estimating the market to be worth about US$22.3m.
On the other hand, the United Nations estimated that durian imports in China have climbed an average of 26% year-over-year in the past decade, reaching $1.1 billion in 2016.
Commenting on the popularity of durian in China, Loris Li, Mintel’s food and drink analyst for China said that “Chinese consumers are open to trying different foods which incorporate durian fruit.”
Thailand’s export to China
According to the United Nations Commodity Trade Statistics database, in 2016, Thailand was the world’s leading exporter of fresh durians with 402,661 metric tonnes, worth $495 million. Of the total, 303,430 tonnes worth $394m of durians were exported to China.
The country exported 120,000 tonnes of durians last month, a 135% increase compared to same period last year, with a value estimated at US$220 million, rising 207% year-on-year.
Of this, 56,000 tonnes went to China, skyrocketing 700%, and accounted for almost 50% of all durian export, Pimchanok Vonkorpon, director of the Trade Policy and Strategy Office of the Ministry of Commerce said recently.
More profitable than palm oil?
Durian cultivation could generate nine times as much revenue than palm oil on a per hectare basis, and generate a pre-tax profit margin above 50%, according to a report by Maybank Kim Eng Securities.
Amongst which, the most prominent Musang King Durian was said to generate nine times as much revenue as oil palm at 150,000 ringgit ($37,722) per hectare in 2017, it said.
As such, some oil palm planters may switch to the crop at the next replanting cycle given the scarcity and high cost of land and rising wages.
“Considering the rising demand [for durian], there is immense opportunity for Malaysia to increase its market share once China allows Malaysia to export fresh durian as Malaysia’s durian offers a superior taste,” it said.
Source : Food Navigator Asia