Click to read the original article for details The pandemic has given canned food a temporary boost. Canned food is common in Shanghai's supply materials, and it ranks high on the stockpiling lists compiled by Shanghai residents. Some netizens say that meat cans can serve as a dish, vegetable cans as side dishes, tomato cans can be used as sauce to stir-fry other ingredients, and fruit cans are like cola—a comforting treat when feeling down. As a result, when stockpiling, residents not only prioritize essentials like rice, flour, and cooking oil but also casually pick up a few cans of luncheon meat, tuna, or fruit, thinking, "They won't spoil anyway, just in case." Canned food, once labeled as "full of preservatives," "all saccharin," "causes cancer," or "made from rotten ingredients," has unexpectedly found itself in the spotlight. This opportunity has allowed many consumers to learn about the canning process, discovering that cans are not a mix of bacteria, carcinogens, and preservatives, but rather achieve long-term storage through sterilization and sealing. With changing demand and perceptions, canned food has gained some traction among consumers. However, from an industry-wide perspective, the canned food market remains traditional, mature, and dominated by established companies. Although new brands are emerging, constraints from Chinese consumption habits, difficulties in process upgrades, and competition from fresh food markets, delivery services, and other convenience foods mean the market remains stable but with little change. No one has managed to break out of the small tin box and tell a new story. Under the pandemic, canned food gained some popularity Li Qing in Shanghai advised friends elsewhere: stock up on more canned food. During the pandemic, she felt her perception of canned food was overturned. "At first, we bought fresh vegetables and fruits, lots each time, but leafy greens and fruits spoil quickly. Watching fresh food go bad was anxiety-inducing," Li said. She first encountered luncheon meat cans in government-supplied materials and realized that canned food's advantage in preserving freshness was exactly what was needed during the pandemic. "Luncheon meat has a three-year shelf life. Even if we don't eat it now, we can store it and eat it later without worry," she said. Previously, she thought she wouldn't buy luncheon meat cans if she didn't like or need them. "I treated canned food the same as all other foods, but its role and advantage lie in storage and transportation. Keeping some cans at home, like instant noodles or river snail rice noodles, is convenient and won't spoil, even without a pandemic." Li also mentioned that the pandemic taught her about food preservation techniques. "There are many online tutorials on storing fresh produce. For example, leafy greens and scallions should be dried, wrapped in kitchen paper, and then placed in fresh-keeping bags," she told Kaibo Finance. In normal times, she wouldn't have considered such methods. "After I started freezing ingredients myself, I suddenly understood canned food. I think the canning process is definitely more scientific than our methods." In stockpiling lists shared by Shanghai netizens, canned food ranks third. Rice, flour, oil, meat, poultry, eggs, and dairy top the list, followed by frozen semi-finished products, and then convenience foods that can be stored long-term, including canned food. Li Qing says canned food is a dish. "We used to think cans were salty and had long shelf lives. But that's exactly their advantage. When you don't have time to cook, open a can of braised pork or luncheon meat and mix it with rice." Additionally, the price is satisfactory to Li. For common luncheon meat cans, a 198g can costs around 15 yuan, about 40 yuan per jin. Compared to live pig prices at farmers' markets, 40 yuan is quite high, but on fresh food e-commerce platforms popular with young people, packaged pork belly costs around 30 yuan per jin. Li thinks that including seasonings, the price is acceptable. Fruit cans like yellow peach cans are also priced similarly to fresh fruit, with a 425g can costing around 7 yuan. Recently, An Ran in Beijing also stocked up on luncheon meat cans. As a fruit lover, she also learned that fruit cans are not as unhealthy as she imagined. "When I buy fresh fruit, some always ends up rotting. Canning solves that problem, and it's relatively fresh, better than throwing it away," An said. She recalled that her family always told her that only rotten fruit was made into cans, and fruit cans were soaked in saccharin. Objectively, canning seals fresh ingredients in containers, and for long-term preservation, some nutrition and flavor are inevitably sacrificed. "Not as good as the best, but better than the worst" aptly describes canned food's position. Compared to synthetic and highly processed foods, cans contain real ingredients, but compared to fresh produce, they have higher sugar and salt content. For example, meat cans like luncheon meat and braised pork are high in sodium and potassium, with a salty taste. Vegetable and fruit cans like cucumber and yellow peach lose some vitamin C. In industrial canning, sterilization and sealing are the main processes ensuring safety, not preservatives. The China Canned Food Industry Association has explained the canning process: First, raw ingredients are sterilized at high temperatures, then sealed in materials like tinplate to isolate external air and moisture, achieving long-term preservation. Therefore, as long as standard processes are strictly followed, no preservatives are needed in canned food. From non-essential to "just in case," from snacks to main meals, from "junk food" to shedding the preservative label, the pandemic has given canned food a chance to prove itself anew. Many old companies, reliance on exports Canned food has no new story According to statistics from the National Bureau of Statistics on 665 canned food enterprises above designated size, China's canned food industry produced 8.3171 million tons in 2021, with total main business revenue of 117.347 billion yuan. The market is large, but canned food remains a marginal part of Chinese consumption habits. Li Yingtao, research director at Analysys' brand retail industry center, told Kaibo Finance: The market is large, but it mainly relies on exports; domestic consumption of canned food is very low. In Western countries, industrial production lines are mature, canned food is inexpensive, and lower-income consumers often choose it. Additionally, shopping and cooking habits differ greatly between China and the West; canned food suits Western diets better. "For example, Westerners shop once a week or every two weeks, driving to large supermarkets like Metro, Walmart, or Sam's Club, filling the trunk, and returning to the suburbs. They prefer foods with long shelf lives." Moreover, canned food's preservation advantages are not unique in Chinese cooking. "Long ago, before cans existed in China, we made cured meat and salted meat for preservation. This food function somewhat replaced cans, and cured meat has broader applications than luncheon meat cans, as it can be used in stir-fries and steamed rice. So cans are just a supplement in specific consumption scenarios." Essentially, canned food is a product with strong era characteristics, popular during wartime and poverty. Now, due to the pandemic, consumers have noticed it again. Consumers have an "old impression" of canned food, and the industry is mostly composed of "old companies." Luncheon meat cans include Shanghai Maling, COFCO, and Beidaihe; fruit cans include Linjia Shop and Zhenxin; braised pork cans include Gulong Food; and fermented black bean fish cans include Ganzhu. Most of these established canned food companies were founded in the 1980s and 1990s, with Gulong Food having nearly 70 years of history, established in 1954. In recent years, new brands have entered the canned food market. Snack brands like Three Squirrels and Bestore have leveraged their brand advantages to launch canned products. In the luncheon meat segment, many "internet-famous brands" like Xiaozhuhehe, Wangjiadu, Zhuzhangmen, and Lixiangguo have emerged, and some fitness-oriented low-fat food brands have also made chicken breast cans. Compiled from public data / Chart by Kaibo Finance Tianyancha data shows that there are currently over 48,000 canned food-related enterprises in China, with more than 4,000 registered each year from 2018 to 2020. Despite the large number of enterprises, consumer response shows that canned food consumption is low; occasional supermarket purchases are dominated by the old brands, and new internet-famous faces struggle to change existing consumer mindsets. Taking luncheon meat as an example, new brands like Maling and new brands like Xiaozhuhehe have similar prices. However, brands like Wangjiadu and Lixiangguo, which tout "new processes," are priced about twice as high. Canned food's old ways cannot carve a path in today's consumer market, and old companies are eager to innovate and tell new stories. Linjia Shop launched zero-fat yellow peach cans, and Shanghai Maling introduced single-serving cans to win over young consumers. Despite these efforts, the overall canned food market remains stable. Haodangjia, Shanghai Maling, and Kaichuang International are leading companies in the canned food industry, all listed on the Shanghai Stock Exchange. From disclosed financial data, companies that have been in the industry for years do not rely solely on selling cans; they also depend on strong aquaculture and fresh meat exports for revenue. Shanghai Maling's most famous product is luncheon meat cans. Its 2021 financial report mentions that pig farming, pig slaughtering and deep processing and distribution, beef and mutton, and snack foods are its main businesses. The beef and mutton business generated 12.8 billion yuan in revenue, the highest among its segments. Canned food, the deep-processing business, generated 5.8 billion yuan in revenue. In terms of gross margin, snack foods represented by candy and honey had the highest at 36.25% in 2021, while the deep-processing business had a gross margin of 13.1%. Stuck in the middle, hard to turn the tables Stability and age are the overall characteristics of the canned food industry. Even when trying hard to adapt to new Chinese dietary trends, the form and process of cans limit how much they can change beyond the basic framework. This is the awkward position of the canned food market. Li Yingtao believes the canned food market is very mature. "In terms of categories, there are pork, beef, mutton, seafood, vegetables, and fruits, with many companies in each. For specific companies, each has its specialty, like Shanghai Maling for luncheon meat. The advantage is that although the market isn't growing fast and domestic scale is stable, external competition is relatively small, and few new companies venture into canned food on a large scale." A person close to a new consumer brand told Kaibo Finance that their canned food business is still loss-making. "To make a name in canned food, you must innovate—whether in meat content, process, or flavor. Either add more meat, make it low-sugar and low-fat, or use low-temperature fresh-keeping, which raises costs and prices." Therefore, for new consumer brands, being a catfish in the canned food market is not easy. Guo Xiao, a staff member at Wangjiadu luncheon meat, told Kaibo Finance that compared to old brands like Maling and Spam, Wangjiadu has much market space to explore. "We need to let more consumers know the brand first, then understand the product." He mentioned that for new brands, to break the past impression of luncheon meat cans as unhealthy and cheap, they must first work on production processes and ingredient selection. "Our core consumers are affluent middle-class, young white-collar workers, and refined mothers aged 26-40. These people have higher requirements for raw materials and processes." Second, they need to explore more ways to eat luncheon meat, making it a staple ingredient at home rather than an optional food. "The product line also needs continuous expansion and enrichment, using different flavors, specifications, packaging, and storage methods to meet the needs of different consumer groups." Canned food's age is also reflected in two aspects. First, it hasn't completed a generational leap. "Our 3R food has moved to a new stage—fresh, high-quality, and high-grade. For example, instant noodles have undergone this differentiation and leap, with products that have shorter shelf lives, no preservatives, and more generous beef and seasonings, albeit at higher prices. This segment is growing very fast," Li Yingtao said. Canned food hasn't completed such differentiation. "Its development path is slower than other categories, and it lacks an explosive moment." Second, the drawbacks of tin packaging. Li Yingtao noted that there are Chinese foods like Dezhou braised chicken, Beijing roast duck, and soy-sauce duck stored in vacuum plastic packaging with shelf lives of over six months or even longer. "Compared to cans, these foods better match Chinese eating habits." Therefore, to make consumers more accepting of such packaged foods, companies must avoid industrial assembly-line production and focus on making products taste closer to freshly made food, meeting Chinese needs, especially at this stage. However, innovating packaging could lead to a "neither fish nor fowl" situation. "The canning packaging method has locked in the value of this category," Li analyzed. The advantage of canned food is transportation and storage. If new processes are adopted, it wouldn't strictly be canned food but a new category developed by the company. "For old brands, to make a big breakthrough, they need to create new categories, while canned food can serve as a cash cow to maintain the business base." New brands find it hard to enter, new categories are hard to expand, and canned food's awkwardness comes not only from itself but also from external impacts. Simply put, canned food falls under convenience foods, once labeled as junk food along with instant noodles and puffed snacks. But compared to instant noodles, puffed snacks, and ham sausages, canned food has narrower consumption scenarios, lower convenience, and lower penetration. Therefore, within convenience foods, canned food inevitably faces pressure from other products. Additionally, the fresh food market poses a significant challenge. Chinese people are accustomed to buying fresh produce, and with widespread wet markets, numerous supermarkets, and increasingly developed fresh food e-commerce, these channels favor fresh ingredients, not long-shelf-life, less-fresh canned food. The delivery market is similar. Currently, canned food consumption is limited to special periods or times when there's no time to cook. "When the delivery industry wasn't developed, you could cook instant noodles or eat canned food after a late shift. But after delivery services rose, canned food's convenience advantage disappeared," Li Yingtao said. Following this logic, canned food is at the lower end of Chinese consumption habits; any more convenient product may take priority. Coupled with difficulties in innovation and upgrading, it's easy to understand its awkward position. An Ran said the pandemic gave her a chance to learn about canning, and she no longer resists canned food. "But I haven't formed the habit yet; I'll buy as needed in the future." *Title image from Visual China; in-text images from Unsplash. At the request of interviewees, Li Qing, An Ran, and Guo Xiao are pseudonyms. Source: Kaibo Finance (ID: kaiboluocaijing) Great article! Must like, share, and comment.