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JD.com seafood sales surge 150 percent in China during coronavirus lockdown

Datetime：2020-04-08

Chinese online retailer JD.com increased its sales by 150 percent in February year-over-year as Chinese citizens stayed home during the coronavirus lockdown.

In terms of sales volume (number of items sold), the company’s year-on-year growth rate in February was 256 percent, JD.com spokesperson Yuchuan Wang told SeafoodSource. As a company policy, JD.com declines to break down actual values or volumes.

Based off this strength, on 2 April, JD.com’s fresh food e-commerce business JD Fresh announced a plan to sell 100,000 tons of crawfish from Hubei Province, the epicenter of the COVID-19 epidemic. Hubei produces half of China’s crawfish, but since the outbreak of COVID-19 in Hubei in January, sales of produce from the province have been suspended due to the lockdown.  JD.com’s commitment to sell CNY 6 billion (USD 846 million, EUR 782.5 million) is being made to help recover the crawfish industry in Hubei, Wang said.

In addition, JD will also launch 10 initiatives, from merchant enrollment, to traffic, operations, financial and logistics supports, to aid the recovery of Hubei’s agriculture industry. JD also said it will provide crawfish standards and quality control services “to help Hubei build strong fresh food brands,” Wang said.

The surge for JD.com may be suggestive of a new trend and comes as a new study by market research firm Nielsen suggests food consumption patterns in China may be changed by the coronavirus toward a long-term move to increased home consumption. That would have a major impact on seafood sales in China, which prior to the COVID-19 outbreak had been driven by out-of-home consumption.

In the Chinese mainland, 86 percent of those surveyed said they would eat at home more often than before the outbreak, while 77 percent of consumers in Hong Kong said they were planning to eat at home more often than before the crisis. In South Korea, Malaysia, and Vietnam, that number was 62 percent, respectively, according to the Nielsen Social Intelligence Survey on Coronavirus.

Meanwhile, higher freight prices have triggered new initiatives by seafood exporters shipping into China, according to Alice Lui, a partner at Park & Lui Associates, a market research agency with a focus on China’s agri food and seafood export and import markets. Lui said the seafood industry has banded together to attempt to get a better deal on freight.

“I saw joint efforts made among the industry such as group-shipping and fridge-sharing when the price surged for limited cargos before the U.S. announced the flights ban,” Lui said.

Lui said she worries about the Chinese market for imports if COVID-19 restrictions continue long-term, both in China and internationally.

“For China, it's the demand problem,” she said. “One study we had in mid-February among 1,200 Chinese consumers, when the virus controls were still unpredictable, showed 52 percent of them [will likely] cut household expenditures if there’s no situation improvement in one month, while 43 percent [will return] their steady budget once the situation is stable.”

News source: seafoodsource.com