China's FMCG market recovered steadily in Q2
China's FMCG market recovered steadily in Q2, and the performance of different formats continued to diverge
The latest report released by Kantar Worldpanel indicates that the fast-moving consumer goods (FMCG) market in urban China continued to recover steadily in the second quarter of 2024, with a year-on-year sales growth of 2.5%.
In the first six months of 2024, the overall market sales grew by 2.3% year-on-year, with the difference in performance across categories continuing to widen. The beverage category became the main engine of growth in the FMCG market, with an 11% year-on-year increase in the first half of the year, with ready-to-drink teas and fruit juices showing even stronger growth. While homecare and food categories sustained positive growth, the dairy and personal care categories are facing more serious growth challenges.
The latest data released by the National Bureau of Statistics also shows that the retail sales of consumer goods in urban areas increased by 3.7% in the first half of the year, and the contribution of final consumption expenditure to China's economic growth was 60.5%. However, the lack of effective domestic demand is also affecting the full recovery of the FMCG market.
At the city level, the lower-tier market continued to be the key driver of China's consumer market, particularly the consumption of prefecture-level and county-level cities where growth has exceeded 4%. The East and West regions led the consumer recovery, recording year-on-year growth of 6.8% and 3.1% respectively.
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Jason Yu
Managing Director of Kantar Worldpanel in Greater China
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