The Food Revolution Group (ASX: FOD) has received notification that it has gained China Inspection and Quarantine Certification (CIQ) for its Fruit Farm Orange Juice products.
The company boasts that its products gained CIQ approval in only 10 days which means its pallet of ‘Fruit Farm 2 Litre Orange Juice’ was approved to be shipped to Shanghai for the upcoming China International Import Expo commencing on 5th November.
The occasion will feature China’s Commerce Minister Zhong Shan as part of the country’s broader effort to liberalise trade relations with its largest import partners globally.
Food Revolution is attending the event and will share its floor space together with its local distributor Careline Australia.
Earlier this year, Food Revolution secured a distribution agreement with Careline that would expand its sales into China through Careline’s growing network of more than 10,000 affiliate marketing agents, also known as “daigous”.
Food Revolution says it has developed a “cold fill technology” to increase the shelf life of ambient juice allowing the company to send long-life juice utilising freight.
It hopes the innovation will facilitate a pronounced move into the Chinese market and set the stage for the company to import additional products in the foreseeable future.
Together with the CIQ certification and the company’s growing Chinese distribution capabilities, Food Revolution says it is now “in a very strong position” to launch products into the Chinese market.
The concerted move into China is further boosted by a gradual decline in demand for US-sourced products due to the ongoing sanctions debacle between China and the US, as well as persistent sabre-rattling by US policymakers and officials.
The worsening trade relations have created a tangible “current tariff threat” that has dissuaded many importers from committing to sales deals from US suppliers in recent months.
Food Revolution in China
According to Food Revolution, its growth strategy is focused on selling functional foods and food supplements into China.
Its first product gaining CIQ approval in a relatively short time means the company now intends to increase the flow of its products into the world’s biggest retail market, saying that “many more” products are in its pipeline.
“This is good news for Food Revolution’s strategic vision to quickly grow our presence in China. We will now show Fruit Farm 2 Litre Orange Juice at the China International Import Expo in Shanghai next week and hope to generate firm orders very soon,” said Norman Li, newly-appointed executive chairman of The Food Revolution Group.
“Through our distribution contacts, we are seeing that due to the current tariff threat there is a shift away from American juice products to alternative sources of supply such as Australia. The focus of our compliance team now shifts to getting CIQ approval for our existing and new products we are developing for the Chinese market,” added Mr Li.
This morning’s news helped Food Revolution shares to gain 14% and to trade at $0.12 per share by midday.