Kangaroo meat is mainly a product of Australia. The meat comes from free-ranging kangaroos including the red kangaroo, common wallaroo, western grey kangaroo, and eastern grey kangaroo species. Notably, not many Australians consume kangaroo meat although the number has been rising gradually over time. This is as a result of government and environmental organizations initiatives to promote consumption of kangaroo meat for environmental reasons. Regardless of the rise in the number of consumers, the production still exceeds the market demands. Thus, it is quite essential for the country to find a new market for the product. In this regard, China is an ideal market due to factors which include but not limited to the size of the market and economic stability.
Introduction
About 3 percent of Australia’s 50 million kangaroos are used for meat production. Additionally, kangaroo meat is produced based on quotas that are set scientifically and monitored regularly. The meat is sourced from four species of kangaroos; red kangaroo, common wallaroo, western grey kangaroo, and eastern grey kangaroo. The mentioned species are in abundance, and therefore they are not endangered or likely to be extinct. Noteworthy, kangaroo meat is relatively low in fat and rich in iron and vitamin B, specifically vitamin B12. The meat is thus quite marketable and more so because it is unavailable in other countries. This is a report on the potentiality of China as the new market for kangaroo meat from Australia.
Research Objectives
The objective of this study is to:
1. Discuss China in regard to its high potential to become the best market for Australia’s kangaroo meat.
2. Identify key opportunities for producers of kangaroo meat in Australia.
3. Identify the key barriers to the success of the kangaroo meat industry in Australia.
Methodology
The method used for this study is the literature review; it helped to understand the critical features of the Chinese market that make it ideal for kangaroo meat. Furthermore, the methodology was used to identify opportunities as well as barriers to the entrance of the Chinese market by producers of kangaroo meat in Australia. The information used for this report is up-to-date as the reports referred range between one and five years.
Market Analysis
The consumption of kangaroo was advocated by environmental scientists to prevent inland soil erosion. However, most people did not support the idea mainly because kangaroo is a valued animal in Australia. Also, farmers were against the idea of rearing kangaroos claiming that the practice is backward and that modern farming does not favor the practice in any way whatsoever. Nonetheless, the consummation of kangaroo has persisted due to the campaigns of the Kangaroo Industries Association of Australia (KIAA); the organization has facilitated the coordination of kangaroo-shooters, abattoirs, and marketing since 1964. It also enabled the classification of kangaroo as an edible game by the Australian National Food Authority.
Notably, the sale of kangaroo for human consumption was illegal in Queensland, Victoria, and New South Wales until 1993. However, the consumption is now legal in the entire country (Waitt 409). As mentioned before, consumption of kangaroo is being promoted in Australia because it is viewed as a way of protecting the environment; unlike cattle, a kangaroo produces less methane due to its digestive tract. There has been an improvement in consumption of kangaroo in Australia owing to the campaigns being undertaken, although supply has always exceeded consumption. For this reason, producers of kangaroo meat ought to find alternative markets to sell the surplus meat, and China serves as one of the most favorable countries to supply the product.
Product Identification
Kangaroo meat sourced from different species including red kangaroo, western grey kangaroo, common wallaroo, and the eastern grey kangaroo was chosen. It is legal to harvest meat from these species because they are in surplus (Waitt 407). Further, kangaroo meat has several benefits; it is low in fat and rich in iron and vitamin B. The government encourages its consumption because it is a way of conserving the environment.
Existing Industry
Notably, Australians are not fond of kangaroo meat as statistics prove; a 2007 national survey that involved 1,590 meat consumers showed that only 4.7% or 75 households eat kangaroo frequently regardless of the high supply of kangaroo meat in shopping outlets. Also, the cost of kangaroo meat is comparatively cheaper because unlike others sources of meats, kangaroos are not reared, and harvesting happens in their natural environment. The harvesting is monitored by KIAA and regulated by governmental organizations such as the Australian Quarantine Inspection Services (AQIS) and the Australian Government’s Primary Industries.
66 percent of Australians consume kangaroo meat in restaurants. In 2008, the ‘Garnaut Climate Change Review’ positioned kangaroo at the center stage of the national diet and in climate mitigation policies (Waitt 406). Although the number of people who feed on kangaroo meat is increasing, many Australians are yet to adapt to feeding on kangaroos on a regular basis. However, the Australian kangaroo meat industry is set to benefit from the increasing preference for kangaroo meat.
External Market Overview: Pestle Analysis
Political Issues
China is a politically stable country, and this makes it an ideal business haven as political stability is integral to successful business. Also, the political system and more so international trade policies in the country limit the possibility of conflicts. Thus, Australian kangaroo meat industry can establish a successful market in the country.
Economic Issues
China is the most populous nation in East Asia with a total population of 1.379 billion (according to the 2016 census). This means that the kangaroo industry can maximize the wide market in the country and establish a lucrative business. Further, the economy of the nation has proliferated over the past three decades on account of high investment, strong export orientation, and energy-intensive manufacturing (Green and Stern 3). The large population is undoubtedly a ready market, and with low prices of meat, the industry is bound to thrive.
Technological Issues
Notably, there has been a significant growth of technology in China owing to the availability of resources as well as economic stability. Also, smartphones have become commonplace globally including among the Chinese population. Therefore, the producers of kangaroo meat can increase their sales by using the available technological resources such as the internet to market the product. Additionally, they can make use of online platforms such as Alibaba to expand and reach a broader market.
Legal Issues
The Chinese government is a significant shareholder of most Chinese companies. Also, it tends to prioritize Chinese businesses over foreign ones; for this reason, the producers and distributors of kangaroo meat are more likely to face challenges in penetrating the market fully. On a positive note, the Chinese government may consider giving Australia access to its market on account that it is in the forefront of supporting policies that seek to protect the climate, and finding a wider market for kangaroo meat falls under this category.
Societal Issues
Unlike Australia, kangaroo does not have any significant meaning in China. Furthermore, the Chinese have a preference for exotic meat products, and therefore many of them are likely to be attracted to kangaroo meat. Although statistics claim that there is a decline in consumption of meat and an increase in demand for cereals as per capita income increases, the Chinese population is big enough to support the kangaroo meat industry.
Environmental Issues
Marketability of kangaroo meat in China is high primarily because the government is dedicated to protecting the environment and promoting a habitable climate (Green and Stern 4). As one of the most populated countries in the world, the consummation of kangaroo meat will improve the country’s environment, whether directly or indirectly. This will incentivize the Chinese government to support the Australian kangaroo meat industry.
Demand Analysis
China does not have indigenous kangaroos as the present ones were brought from other countries like Australia. Therefore, most Chinese are less likely to be aware that kangaroo meat is suitable for human consumption. Nonetheless, through marketing, it is possible to get a sizeable market share more so due to the large population of China. Notably, China consumes a quarter of the world’s meat; a recent study found that an average household consumes 2.90 kg of pork, 1.47 kg of chicken, 0.77 kg of beef, and 0.33 kg of mutton (Zhang, Wang, and Martin 24). This shows that there is still a preference for meat in the country and this makes it more likely for people to purchase kangaroo meat. Producers of kangaroo meat only have to promote kangaroo consumption in the country.
Competitive Analysis
Pork is the most common type of meat consumed in China. Other common types of meat are chicken, mutton, and beef. Producers of kangaroo meat are thus likely to face stiff competition from producers of these types of meats. The competition can be exacerbated by the fact that kangaroo meat is relatively a new product in China (Zhang, Wang, and Martin 24). Producers of kangaroo meat will have to invest in marketing to increase the chances of getting a share of the market.
Opportunities
1. There is a surplus of kangaroo meat in Australia.
2. China has a large population and is thus a good market for the product.
3. China supports initiatives that promote conservation of the environment.
Risks
1. Consumption of kangaroo meat is relatively new in China, and so the popularity of the product is low.
2. Producers of kangaroo meat risk tight regulations or sharing control with the government.
3. Producers of kangaroo meat are likely to face stiff competition from producers of other types of meat.
Conclusion
China is the ideal potential market for kangaroo meat. Albeit the product is not yet known in the country, its market has features that make it the best choice for the product. Some of these are the large size of the market, political and economic stability, and tendency of Chinese people to love exotic meat. For these reasons, producers of kangaroo meat are likely to establish a stable market in China.
Recommendations
Australia should invest in aggressive marketing of the kangaroo meat. Marketing should focus on popularizing the product by mentioning the benefits thereof as well as its comparatively low price. Also, the meat producers should work in tandem with the Chinese government and ensure that they comply with the laws of the country as a way of guaranteeing a long-term relationship. Equally important is to approach the market with a solid plan, keeping in mind that China has a large and diverse population and people have different preferences. In this regard, the government can sponsor research to understand the population that is more likely to consume kangaroo meat.
Works Cited
Green, Fergus and Nicholas Stern. “China’s “new normal”: Structural change, better growth, and peak emissions.” Centre for Climate Change Economics and Policy (2015): 1-54.
Ratnasiri, Shyama and Jayatilleke Bandara. “Changing patterns of meat consumptions and greenhouse gas emissions in Australia: Will kangaroo meat make a difference?” PLoS one. 12(2) (2017): 1-13.
Waitt, Gordon. “Embodied geographies of kangaroo meat.” Social " Cultural Geography. 15(4)(2014): 406-426.
Waitt, Gordon and Bryce Appleby. “It smells disgusting ‘ : Plating up kangaroo for a changing climate.” Continuum: Journal of Media " Cultural Studies, Vol. 28(1)(2014): 88-100.
Zhou, De, Xiaohua Yu, David Abler, and Danhong Chen. “Projecting Meat and Cereals Demand for China Based on a Meta-Analysis of Income Elasticities. GlobalFood Discussion Papers, (2014):1-39.
Zhang, Haifeng , Jua Wang, and Wayne Martin. “Factors affecting households’ meat purchase and future meat consumption changes in China: A demand system approach. Journal of Ethnic Foods, 5 (2018):24-32.
