In the last nine months of 2011, China’s Nutrastar reported revenue growth of 38% with net income rising by 16.5%, figures that are in-line with the wider health food industry in China, which is believed to be growing at a rate of 20-30% to reach US$15 -19 billion, according to a report on health foods and dietary supplements compiled by the US Commercial Service, Department of Commerce.
Ms. Lianyun Han, CEO of Nutrastar, commented, “In spite of difficulties in the global market, third quarter 2011 closed as a significant quarter in Nutrastar’s history. Not only did we experience a notable uptick in sales volume for both our core cordyceps and new functional health beverage products, but also made momentous advances in our corporate development.”
Cordyceps is derived from a fungus typically found in high altitude mountainous regions of China. It is believed to strengthen the immune system and combat harmful effects from fatigue and aging and is immensely popular with Asians and Chinese.
Ms Han added that solid demand for Cordyceps, its flagship product grew by 15% in sales and also helped to expand the distribution network.
Functional beverages
The company’s functional health beverages division grew by 86%. Since rolling out its beverages in late 2010, Nutrastar has continued to focus on increasing our market penetration through strategic marketing and developing brand profile in the beverage business.
The robust demand for health products in China meant that Nutrastar would continue to invest in the production of cordyceps, and the company has already started on the extension of its organic and specialty foods business.
“On Nutrastar’s product pipeline, our organic & specialty foods business is undergoing a strategic expansion both in production capacity and product offering over the next 12-18 months,” said Ms Han.
Nutrastar is working closely the Northeast Agricultural University to construct greenhouses that can grow large quantities of organic fruits and vegetables. The products are scheduled to be in the market in early 2012. Also in the pipeline is the company’s Cordyceps infused alcohol, which is expected to be introduced in the near future.
Overall market
The wider health food industry in China is reporting impressive growth. Popular products include health foods that boost immune systems, fight aging, lower blood pressure and glucose levels, cleanse bowels, promote digestion, reduce weight, promote bone density, etc.