“Demand by consumers is rising very quickly because the Chinese economic landscape is improving, and people are aware of health requirements; they want a healthy and beautiful life,” Tracy Li, executive vice president at China Nutrition and Health Food Association (CNHFA), told delegates at the GOED Exchange earlier this month.
She stressed the importance of preventative health care in the country.
“The number of elderly people is rising quickly, and older people will always think about how to increase their life span,” she said. “At the same time, younger consumers have more requirement for health and nutrition.”
In 2022, China’s health products market reached 230 billion yuan, ranking second in the world and the scale is expected to exceed 300 billion yuan by 2028.
Li noted that the pandemic particularly accelerated interest in immune health, family health and sports and fitness—with consumers now expressing a heightened interest in botanicals, probiotics, fish oil and Q10, as well as greater personalisation and innovative dosage forms and packaging.
Health food registration
“China is full of opportunity for health and nutrition but the policy on healthy food is challenging for international companies,” Li said, adding that fish oil appears on the Chinese market under the ‘Health Food’ (aka ‘special food’) legal category in China, referring to foods that claim to have specific health functions or supply vitamins and minerals.
Health food products can be marketed via healthcare routes such as pharmacies and claim to regulate the body’s functions but cannot make disease treatment claims.
Li explained Chinese health food regulations are very strict because of the Chinese culture and the fact customers have high expectations of products.
At present, China allows ’24+1′ health functions to be claimed by health food, including 24 health functions for functional health food and one health function for nutrient supplements (vitamin/mineral supplement).
Dual-track registration for ‘blue hat’ certificate
For a product to join China’s health food market, there is a ‘dual-track’ registering and filing system based on the raw materials within it.
Health food with raw materials not included in the Health Food Raw Material List, and health food imported for the first time, must go through the registration process. This process involves the requirements of an animal test or human feeding trial according to the declared health function.
Registered products have a broader choice of raw materials and functional claims, but the process involves a longer review period and costs associated with studies.
Vitamins and minerals included in the Health Food Raw Material List can enter the market via the filing process for which no functional test is required. The filing process reduces the administrative process, accelerating product launch but is limited in terms of raw materials and functional claims allowed.
Products that have gone through State Food and Drug Administration registration or filing must then carry the ‘blue hat’ logo, an important symbol of trust for the consumer.
Li commented that this symbol is “good for the market, and the consumer believes in it”.
Alternative routes to market
Alternatively, products can enter the market as a ‘functional food’, which is not technically a regulatory concept, but it is an industry consensus and a rapidly growing market and refers to foods with functions that strengthen the body, regulate physiological rhythm and promote health.
More and more functional new food raw materials are used in functional food, with many consisting of functional carbohydrates, lipids, botanicals and probiotics.
Products that enter the market as a functional food tend to do so via the online market and are not allowed to claim any health functions or imply to have health function in words.
“It’s a very big rise in the market in China; it’s very hot in China now, so if you can’t go to the blue hat, go to the functional food,” Li said, noting the popularity with younger consumers in China.
The other way to get into the Chinese e-commerce market is via cross-border e-commerce. This route does not require domestic registration tickets.
Li explained brands will often take this route first so that they can build an audience of consumers for their products before entering a lengthy registration process.
However, she said that this path to market does make it harder for China to supervise the market and protect its consumers, and the government is “paying more attention” to this challenge.
As the government aims to maintain control over the market but also allow for a diverse market, Li said it is trying to introduce new regulations to encourage and support more ingredients and products entry to market via the blue hat certification.
“The last year – 2023 – has been ‘really crazy’ for the Chinese health food industry because more than 30 regulations were released,” she said.
She added that the government supports enterprises to apply for the blue hat and apply for new functional claims and new ingredients. It is also encouraging a wider range of formats, such as drinks and foods, to enter the market via this route.