China's Nuts Production Reached 3.6 Million Tonnes

The Chinese nuts market has shown positive dynamics in the last few years. The significant surge of market value in 2008 (163% Y-o-Y) was followed by a steady increase in the next five years, until the growth rate decelerated to +3% in 2013. From 2007-2013, the annual growth rate of the market value was 25.2% per year, driven by rising purchasing power and increasing demand for food products by urban population in China. 

Chinese nuts production in value terms has also shown sustainable growth in the last few years. The gradual increase over the period 2008-2011 was followed by a slowdown in 2012-2013. In 2013, Chinese production in physical terms decreased by 0.1%, reaching 3,620.8 thousand tonnes, which was much higher the lowest level of nuts production recorded in 2007 (2,078 thousand tonnes). 

China’s growth in nuts production is expected to slow to 7% (currently +9.7%), amidst sluggish domestic demand. In the past, nuts consumption was fueled by rising purchasing power, but this engine of growth is now under presure, which will lead the market towards saturation. 

Walnuts held the largest share in total Chinese output, with 1,700 thousand tonnes produced in 2013. They were followed by chestnut (1,650 thousand tonnes), pistachios (130 thousand tonnes), which together accounted for 94.6% of total production. 

The harvested area of these three major crops represented more than nine-tenth of total harvested areas of nuts in China. In 2007-2013, steady growth was observed in harvested area for all types of nuts. Especially high were the growth levels for walnuts (+12.5%) and pistachios (+6.5%). 

The yield of nuts also shown positive dynamics over the analyzed period. Its lowest point was in 2007 at 40.9 tonne/hа and the highest was in 2012 with 44.8 tonne/ha. Walnuts are planted in vast hilly or mountainous areas where many other crops are not nearly suitable or profitable. In Chinese mountainous areas, many walnut plants are left unattended. Because of this, the yields are very low. 

In 2013, the USA and Germany were the main suppliers of nuts into China, with a combined share of 62% of total imports. However, the fastest growing importers in 2007-2013 were Pakistan (+92.08% per year) and the Philippines (+69.5 % per year). 

In 2013, the USA (24.0%), Germany (13.2%), the Netherlands (13.0%) and Japan (12.1%) were the main destinations of nuts exports, and together made 72.0% of Chinese exports in physical terms. While the share of the Netherlands increased significantly, the share of the USA illustrated negative dynamics. The shares of the other countries remained relatively stable throughout the analyzed period. 

Chestnuts dominated in Chinese nuts exports. In 2013, they held 20.1% of total Chinese nuts exports in value terms.

Source: China: Nuts - Market Report. Analysis And Forecast To 2020