August 31, 2015 / 4:58 PM / 4 years ago

German food exports to China surge 47 pct in first half

BERLIN, Aug 31 (Reuters) - German food exports to China rose almost 47 percent in the first half of this year, the Federal Association of German Food and Drink Industries (BVE) said on Monday, despite a slowdown in Chinese economic growth.

The surge in food sales contrasted with a less than 1 percent rise in Germany’s total exports to China in January to June - the same as to crisis-burdened Greece - according to figures from the DIHK chambers of commerce.

Strong demand for German food exports is as much due to Chinese consumers’ widespread suspicion of domestic food products as a growing demand for German goods, said trade agency Germany Trade and Invest (GTAI).

German dairy products are in especially high demand, said GTAI’s representative in Beijing, Stefanie Schmitt: “People don’t trust Chinese dairy products after so many food scandals in the past few years.”

Demand for foreign milk had rocketed as a result, she said, adding that German products were cheaper in China than dairy goods imported from New Zealand or Australia.

Chinese buyers had also transferred their trust of German-made cars and machines onto other goods, she said.

However, despite optimism about growing demand, the industry is hampered by the lack of trade agreements between the two nations, said Schmitt.

German food manufacturers exports to China grew by nearly 47 percent to 604 million euros ($677 million) in the first half, BVE said.

China was Germany’s fourth-biggest export market in 2014, accounting for 6.6 percent of total German sales overseas.

China’s economy, which in the past produced double-digit growth, is slowing. The government reported that annual growth in the second quarter was 7 percent, but some economists expect growth was slower and rising concern about the economy triggered a recent selloff on Chinese stock markets that risks further damaging consumer sentiment. ($1 = 0.8928 euros) (Reporting by Rene Wagner, writing by Josie Le Blond; Editing by Susan Fenton)

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