Promotions, better logistics driving up demand
Many domestic online-shopping sites such as JD.com Inc and Alibaba Group's Tmall launched various sales promotion events on Saturday to mark the beginning of the season for freshwater crabs from famous lakes such as Yangchenghu in East China's Jiangsu Province.
Boasting fast delivery that guarantees freshness, domestic e-commerce giants have driven up sales for crabs and fueled the formation of a market worth billions of dollars backed by the rising spending power of China's middle class. However, competition is also on the rise, which some claim has harmed quality.
Tmall said in a statement on Sunday that during a pre-sales event on Thursday, it sold 140,000 hairy crabs within a minute, which it said was a new record for China's fresh grocery industry. The statement added that China's hairy crab market is now worth 100 billion yuan ($15 billion) and said that Yangchenghu crabs have become a national brand.
JD.com launched a pre-sales event in the week starting on September 11 and sold gift cards for two million crabs within the first 24 hours, according to a press release it issued on September 13. JD.com said it would deliver the crabs after the harvest began to more than 300 cities within 48 hours and 150 cities within 24 hours.
Fishermen in Jiangsu Province have said sales of their crabs are continuing to rise.
Dai Zezhi, a hairy crab farmer based in Xinghua, Jiangsu Province, told the Global Times over the weekend that sales had been "quite robust" in the past two days as demand peaks before the National Day Holiday and Mid-Autumn Festival.
"Compared with the same period of last year, sales of hairy crabs have soared, and there has been a rising trend for several years," Dai said.
Another Jiangsu-based crab farmer surnamed Ming agreed. "Consumers and merchants from neighboring cities have been rushing to purchase Yangchenghu hairy crabs over the last two days, and we have sold about 1,500 kilograms so far, a significant increase over the sales volume last year," Ming told the Global Times on Sunday.
Rising competition
Also on the rise is price, which is partly due to the fact that environmental issues have resulted in a smaller harvest of the crabs, according to Ming.
This is not entirely good news for Ming. He expressed concern about rising competition from other areas, such as crabs from nearby lakes that have been on sale for several weeks.
"Also, demand generally dives after the National Day Holiday, which may put pressure on profits," Ming said.
According to media reports, the size of the farm in Yangchenghu, the origin of the famous hairy crabs, was cut by half this year and output has also seen significant declines. But hairy crabs from other lakes in Jiangsu and other provinces have been filling the massive market, thepaper.com reported on Sunday, adding that online shopping sites have signed up about 17 lakes that produce hairy crabs to sell the goods on their platforms.
"Obviously, with such fast-rising demand, especially in major cities across the country, there aren't enough Yangchenghu crabs, so now we have all these different brands of hairy crabs emerging," Liu Dingding, a Beijing-based independent Internet analyst, told the Global Times on Sunday.
Liu said he received 15 crab gift packages over the weekend. "Honestly, I got more hairy crabs than moon cakes," he said, referring to the traditional cakes eaten during Mid-Autumn Festival, which falls on October 4 this year. "So of course, not all the Yangchenghu crabs out there are authentic and of high quality," Liu said.
He said that while the rise of e-commerce business might have brought intensified competition for Yangchenghu crab fishermen, the overall trend is a good one for the industry and the economy, given its crucial role in expanding the market and boosting domestic spending.
"E-commerce has helped local crab farmers to reach a massive market that was out of reach for them before," Liu said. "The demand comes mostly from the fast-growing middle class."
But more importantly, with various sales promotion events, the online shopping sites have "really stimulated consumption, which is the key for our country's economic growth as we move away from relying too much on [investment and exports] to spur growth," Liu said.
