Fresh fruit is one of the top US food exports to Hong Kong, valued at USD347 million in 2018, and one of the best prospects for US exports to Hong Kong. Hong Kong imported a total of USD3.16 billion worth of fruits from all over the world, buying a mix of expensive and price-competitive fruits.
US fruit has huge potential in the market, presently accounting for 11 percent of Hong Kong’s fresh fruit market. The market is receptive to novelty and premium fruits, while value for money is the key purchasing consideration for average households.
The market is characterized by diverse suppliers and fruit types. In 2018, Hong Kong imported USD3.16 billion worth of fresh fruit. Hong Kong’s fruit market is very vibrant, having an average annual growth rate of 10 percent between 2014 and 2018.The market size enlarged 1.5 times, resulting in an increase in total value close to USD1 billion in five years’ time. In the first half of 2019, total fruit imports had a remarkable growth of 17 percent in value terms, compared to the same period of last year. These impressive trade figures vindicated that the market has a strong demand for fresh fruits, providing huge opportunities for US products.
Hong Kong ranked as the fifth-largest market for US fruit exports and the United States was the third largest supplier for Hong Kong by value in 2018. The United States exported USD347 million worth of fresh fruits to Hong Kong. Though US fresh fruit exports to Hong Kong remain strong, its performance is not as vibrant as competitors. US fruit exports to Hong Kong dropped 14 percent in value terms in 2018 and the decline continued into 2019. Between January – June 2018 and the same period in 2019, US exports declined 18 percent, while most major competitors’ exports to Hong Kong showed positive growth.
The trade figures reflect the dimension of the negative trade impact of China’s increasing tariffs on US fruit.
Hong Kong is a re-export hub for fruit trade to China. An average of 61 percent of Hong Kong’s fruit imports are re-exported and China is the largest re-export market, accounting for 97 percent of Hong Kong’s fruit re-exports. With the trade tensions between the United States and China, the drop in US fruit exports to Hong Kong is not surprising. In 2017, when China did not impose any retaliatory tariff on US fruits, about 59 percent of US fruit exports to Hong Kong were re-exported, but the re-export percentage dropped to 37 percent in 2018 (Table 3), and dropped further to 26 percent in the first six months of 2019.