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Quick Stats

Quick Stats

Organics Dashboard From Passport

  • The organic segment in Hong Kong is led by Hipp GmbH & Co. with a value share of 15.2% in 2019, followed by Nestle’ SA with a share of 13.5% and Holle Baby Food GmbH with a share of 13.4%, indicating a highly competitive market.
  • With a forecast value CAGR of 13.4% for the period 2019-2024, Hong Kong ranks 2nd in terms of expected growth. However, that growth rate is partially attributed to low current market size. 

  • Organic products in Hong Kong represent roughly 0.5% of global demand and approximately 5.5% of the market in the Asia Pacific region, recording a per capita expenditure of US$34.5 in 2019.
  • With demand for organic products expected to grow in emerging categories and an increasingly health-conscious population, the market for organic products is expected to grow with a value CAGR of 13.4% for the forecast period 2019-2024, reaching a value of US$485.3 mn by 2024.
Qualitative Analysis

Qualitative Analysis

Quick Facts
  • Organic packaged food and beverages in Hong Kong recorded value growth of 1.2% in 2019, reaching US$258.6 mn in 2019.
  • Growth in organic packaged food was led by organic prepared baby food, with value growth of 85.0% in 2019.
  • Organic fruit/herbal tea recorded the most dynamic growth in organic beverages; registering a value increase of 7.0% in 2019.
Market Trends
  • Consumers in Hong Kong are increasingly concerned about the origin and ingredients of food products, which has led to an increase in the popularity for organic products such as brown rice and fruits and vegetables, which are staples in Hong Kong.
  • Within organic fruit/vegetable juice, 100% juice using high-pressure processing (HPP) or cold-pressed techniques, is gaining popularity among consumers, due to the perception of being healthier than heat-pasteurized and non-organic juices.
  • While the range of organic products in Hong Kong is expanding, there is a lack of a regulatory authority to monitor and control the quality and authenticity of these products. This has led some domestic players to claim that non-organic products are organic. Hence, imposing regulations and certification requirements is an essential measure to verify that products and ingredients are organic and to ensure credibility for the manufacturers' claims.
Competitive Landscape
  • Sales of organic packaged food primarily come from organic formula milk. Hipp, Wyeth (HK), Holle Baby Food and Abbott Laboratories (HK), the leading formula milk companies have established a solid position in Hong Kong due to their reputation for high quality and product safety, thus, enabling these companies to leverage the high sales of formula milk to visitors from mainland China.
  • Benefiting from its brand image in breakfast cereals, Kellogg’s Be Natural cereal bars continue to grow steadily. The product is sold in multipack boxes in supermarkets and single-serve portions in convenience stores. This accessibility and flexibility have made Be Natural a sufficient breakfast and snack choice for consumers, helping Kellogg’s increase its overall share in organic packaged food.
  • The Pukka Organic Green Tea brand purchased by Unilever Group in 2017 is continuing to benefit from its usage of organic herbs and associated health benefits. The brand gained consumer attention by entering high-end supermarkets while maintaining low prices.
Prospects And Growth Opportunity
  • Consumers' rising interest in food safety is anticipated to spur sales of organic beverages. While this gain is not expected to be seen in categories like sports drinks or carbonates, an increase is likely in categories such as juices and coffee, which are regularly consumed, and are particularly of interest to younger consumers, as they are increasingly focused on finding healthy alternatives for consumption.
  • Organic tea is gaining popularity on the back of the premiumization trend. The rising consumer interest in the different varieties of tea is leading to consumers' willingness to pay a premium to try tea with added benefits or made from high-quality leaves. This rise in demand for high quality tea has led to an increasing number of manufacturers are investing in launching new varieties of tea.
  • Currently, the majority of organic product sales are limited to baby food and staples, such as rice and vegetables. However, with the increasing popularity of organic breakfast foods, spreads and snacks such as the Kellogg's Be Natural Cereal Bars or the Manukka Honey from New Zealand, there are emerging categories with an increase in demand for organic variants.
General Health And Wellness Trends
  • Consumers in Hong Kong are increasingly looking for chemical-free food, with a focus on the origin and ingredients. This has prompted manufacturers to leverage the labels on their offerings by highlighting these attributes, which is a useful marketing tool, not only boosting awareness but also allowing them to charge a premium for organic offerings.
  • The number of juice and tea bars is exploding across Hong Kong, which is a potential threat to sales of packaged organic juices and tea in the retail channel, over the forecast period, as consumers prefer the experience of hanging out and socialising in a juice bar. This poses a threat to major organic players, as several organic beverage brands are generally unknown to consumers.
General Economics And Demographic Landscape

Economy:

  • Hong Kong’s economy is expected to struggle in 2020, impacted by the US-China trade war, as the majority of exports are re-exports from mainland China. Additionally, social unrest in Hong-Kong has led to a 1.3% real value decline in private consumption in 2019 and a growth of 0.1% in 2020. 
  • Hong Kong has the world’s least most affordable housing market, with house prices increasing by 146.0% in the past decade. To slow it down, officials have increased mortgage rates and introduced a stamp duty. However, a property downturn, triggered by monetary tightening in the US, is also possible in the future, raising further concerns.
  • Real GDP growth is expected to improve to 1.5% in 2021 and gradually increase to 2.5% annually in 2024-2026. This is roughly equal to its potential rate of growth.

 

 Population demographics:

  • The population of Hong Kong reached 7.5 million in 2019, increasing from 6.7 million in 2000. The majority of population gains are from immigration, with over 80.0% of immigrants coming from Mainland China.
  • Hong Kong has one of the lowest fertility rates, falling to 1.0 child per female in 2000 and reaching 1.1 children per female in 2019. The fertility rate will remain at this rate of 1.1 births per female through 2030.
  • The median age is steadily increasing, reaching 44.6 years in 2019. With the current ageing trend continuing, the proportion of the population over the age of 65 is expected to represent over two-thirds of the overall population by 2030. This is concerning, as the rapid ageing is likely to result in increased government spending.

 

Income & expenditure:

  • The savings ratio in Hong Kong is slightly lower than the regional average, with a 2019 value of 21.3% of disposable income, and the indicator expected to reach 21.1% in 2020.
  • Consumer expenditure per capita reached US$34,035 in 2019, and a fall of 0.7% is predicted for 2020. For the period 2020-2030, consumer expenditure is expected to cumulatively increase by 26.3%, averaging an annual rate of 2.4%.
  • Disposable income per capita was US$40,526 in 2019, with a fall of 0.1% expected in 2020. A cumulative increase of 24.2% is likely for the period 2020-2030, which is an annual rate of 2.2%.
Data

Data

Organic Packaged Food And Beverage Data

Data type

Unit

2016

2017

2018

2019

2020

2021

2022

CAGR
(16-19)

CAGR
(20-22)

Health & wellness products consumption

USD million

3,979.3

4,193.0

4,426.0

4,694.7

4,855.7

5,034.0

5,227.2

5.7%

3.8%

Organic packaged food and beverages consumption

USD million

163.9

169.1

212.0

258.6

302.1

347.3

392.2

16.4%

13.9%

Organic packaged food consumption

USD million

159.1

164.0

206.7

253.0

296.3

341.4

386.0

16.7%

14.1%

Organic beverages consumption

USD million

4.8

5.1

5.3

5.6

5.8

5.9

6.2

5.3%

3.4%

Organic packaged food and beverages consumption as a % of total health & wellness products consumption

%

4.1%

4.0%

4.8%

5.5%

6.2%

6.9%

7.5%

-

-

Economic And Demographic Data

Data type

Unit

2016

2017

2018

2019

2020

2021

2022

Total population

million

7.3

7.4

7.5

7.5

7.6

7.6

7.7

% Middle and upper class of total population

%

19.1

19.1

19.1

19.1

19.1

19.1

19.1

% Population aged 65+

%

15.9%

16.5%

17.0%

17.7%

18.4%

19.2%

20.0%

% Population aged 0-14

%

11.3%

11.4%

11.6%

11.6%

11.7%

11.6%

11.6%

% Population with higher education degrees

%

26.9

27.8

28.7

29.4

30.0

30.5

31.0

Average number of children per household

children

0.4

0.4

0.4

0.4

0.4

0.4

0.4

GDP per capita

USD per capita

43,321.3

45,914.1

48,558.8

48,755.7

47,203.5

48,046.3

48,723.6

Consumer expenditure per capita (US$)

USD per capita

29,228.8

31,270.0

33,859.6

34,032.5

33,876.3

34,325.7

34,876.5

Consumer expenditure per capita on food and non-alcoholic beverages (US$)

USD per capita

4,100.2

4,254.4

4,459.9

4,399.4

4,546.1

4,838.9

4,898.3

Retailer And City Data

Top 5 Grocery Retailers By Sales

Data category

Rank

City/retailer

Top grocery retailers by sales (2019)

1

AS Watson Group

Top grocery retailers by sales (2019)

2

Dairy Farm International Holdings Ltd

Top grocery retailers by sales (2019)

3

Seven & I Holdings Co Ltd

Top grocery retailers by sales (2019)

4

Alimentation Couche-Tard Inc

Top grocery retailers by sales (2019)

5

CEC International Holdings Ltd

Note : Cities by population data for Hong Kong is unavailable
United States Department Of Agriculture Global Agricultural Trade System Data

Top 5 Export Commodities To Hong Kong

Year

Country

Rank of
Product/Commodity

Product/Commodity

Export Value (US$)

2019

Hong Kong

1

Organic Berries Fresh

3,223,023

2019

Hong Kong

2

Organic Grapes Fresh

1,972,926

2019

Hong Kong

3

Organic Apples Fresh

1,614,287

2019

Hong Kong

4

Organic Cherries Fresh

489,240

2019

Hong Kong

5

Organic Strawberries Fresh

464,085

2019

Hong Kong

Total

Total Organics*

9,284,514

2018

Hong Kong

1

Organic Apples Fresh

2,849,870

2018

Hong Kong

2

Organic Berries Fresh

2,154,048

2018

Hong Kong

3

Organic Lettuce Not Head Fr/Ch

404,505

2018

Hong Kong

4

Organic Celery Fr/Ch

379,560

2018

Hong Kong

5

Organic Fruit Prep

332,447

2018

Hong Kong

Total

Total Organics*

7,720,836

2017

Hong Kong

1

Organic Oranges Fr/Dr

2,823,664

2017

Hong Kong

2

Organic Grapes Fresh

1,596,735

2017

Hong Kong

3

Organic Lemons Fr/Dr

689,550

2017

Hong Kong

4

Organic Berries Fresh

552,334

2017

Hong Kong

5

Organic Celery Fr/Ch

450,306

2017

Hong Kong

Total

Total Organics*

9,141,041

2016

Hong Kong

1

Organic Grapes Fresh

3,630,216

2016

Hong Kong

2

Organic Strawberries Fresh

1,341,976

2016

Hong Kong

3

Organic Cult Blueberries Fresh

945,176

2016

Hong Kong

4

Organic Apples Fresh

908,979

2016

Hong Kong

5

Organic Oranges Fr/Dr

798,950

2016

Hong Kong

Total

Total Organics*

11,011,137

Note : Total organics is the sum of all exports in a particular year
Definitions

Definitions

Term

Definition

Health and Wellness

Health and wellness is the aggregation of organic packaged food and beverages, fortified/functional packaged food and beverages, naturally healthy packaged food and beverages, better for you packaged food and beverages and food intolerance products.

Organic packaged foods and beverages

This category includes packaged food & beverages that are certified organic by an approved certification body. Organic production is based on:

• A system of farming that maintains and replenishes soil fertility without the use of toxic and persistent pesticides and fertilizers.
• Organic food & beverages are minimally processed without artificial ingredients, preservatives or irradiation.
• The use of GMOs (Genetically Modified Organism) is prohibited. “Certified Organic” means the item has been grown according to strict uniform standards that are verified by independent state or private organizations.
• Depending on the country, such products are called ‘organic’, ‘biological’ or ‘ecological’: For organic products to be included under Euromonitor definitions, the organic aspect needs to form part of positioning/marketing of the product. This is an aggregation of organic baby food, bakery, confectionery, dairy, ice cream, oils and fats, ready meals, rice, sauces, dressings and condiments, snack bars, soups, spreads, sweet and savory snacks and other organic food.

Note that fresh food products or individual ingredients are not included in this definition.

Compound annual growth rate (CAGR)

The compound annual growth rate (CAGR) is the average annual growth rate over a specified period of time. For instance, the CAGR consumption of from 2016 – 2019 will be the average growth rates across these three years.

USDA GATS data clarification

The data presented in table 2.4 represents the dollar values of the top 5 organic commodities as well as of the total organic exports of the trade partner for the period 2016-2019 as per the United States Department of Agriculture’s Global Agricultural Trade System, a database consisting of international agricultural, fish, forest and textile products trade statistics dating from the inception of the Harmonized coding system in 1989 to present.

Policy Information

Policy Information

Government Agency(s) / Competent Authority

Authorized Government Agency(s):

Hong Kong’s Center for Food Safety, which operates under the Hong Kong Food and Environmental Hygiene Department (FEHD), is responsible for implementing territory-wide food safety control policies and enforcing food related legislation.

Hong Kong’s Agriculture, Fisheries and Conservation Department has information about organic farming

Agency(s) Contact Information:

Centre for Food Safety (Risk Communication Section)
8/F, Fa Yuen Street Municipal Services Building, 123A Fa Yuen Street, 
Mong Kok, Kowloon
Phone: 2381 6096
Email: rc@fehd.gov.hk
Web

Organic Regulations and/or Standards

Name(s) of Regulation and/or Standard:

Hong Kong does not have any regulation specifically regulating organic standard or
labeling.  They are subject to the same food regulation as any other conventional foods.  There
is no regulation that prohibits the use of any organic logos in Hong Kong.  However, Hong
Kong’s food law has a provision for “False labeling and advertisement of food or drugs,” which
supposedly can protect consumers against any false labeling of organic products.  In addition,
the Hong Kong Customs and Excise Department has legislative backup to combat against
misleading and false trade descriptions.

Imported Products

Hong Kong does not have a law regulating organic food products. US organic products can be sold in Hong Kong with 
the USDA organic logo.

Certification and Accreditation

Certification:

Voluntary organic certification is available, and Hong Kong allows the use of organic logos on products certified by foreign authorities. 

Certifiers in Hong Kong:
Hong Kong Organic Resource Centre 
Hong Kong Organic Certification Centre

Additional Information

USDA’s GAIN Report Best Prospects Analysis for U.S. Agricultural Exports to Hong Kong (2019)
USDA’s GAIN Report Highly Competitive Retail Sector Remains Stable (2019)
USDA’s GAIN Report Hong Kong Food Retail Industry (2018) 
USDA’s GAIN Report New Marketing Guidelines for Infant and Toddler Foods (2017)
USDA’s GAIN Report Food Service - Hotel Restaurant Institutional (2019)
USDA’s GAIN Report Hong Kong Exporter Guide (2019)
USDA’s GAIN Report Hong Kong Macau Exporter Guide (2019)
USDA’s GAIN Report Hong Kong Organic Products Market (2015)
USDA’s FAIRS Report Hong Kong Food and Agricultural Import Regulations and Standards (2017)
USDA’s FAIRS Report Food and Agricultural Import Regulations and Standards Country Report (2020)
USDA’s GAIN Report Hong Kong Retail Food Competitive Shelf Space in Hong Kong Calling for High Quality Foods (2017)

Centre for Food Safety offers a guide for importing food into Hong Kong.