Technology Needs Analysis
Sector: Food and beverage industry
China is one of the largest consumers of food and beverage in the world, and it is also one of the largest
producers. Chinas major cities of Beijing and Shanghai are the leading consuming hubs. The food and beverage
sector in China includes agricultural products process, food stuff manufacturing, and beverage manufacturing.
The market has been increasing during the last decades driven by urbanization, disposable incomes, changing
urban lifestyles and retail distribution. Particular high growth has been seen in the process industry (dairy and dry
food), wine, fish and seafood and meat.
The food and beverage sector is an important market for water technology companies with a global growth
estimate of 6.7 % and two digits growth in emerging markets like China. Water scarcity and environmental
protection are driving this market. Increasing costs for water, energy and materials also drives the market towards
energy recovery, water reuse and material recovery. The main market opportunities for European SME´s in food
and beverage subsectors are where large State Owned Enterprises and multinationals have not yet invested and
where they can leverage their know-how and technologies. Energy efficiency services, water and waste treatment
sub-sectors present particular opportunities for European SME´s.
The water and water management situation in China and in Beijing
China´s water resources are scarce and unevenly distributed. China´s per capita availability is only 2,156m3 /year
(2007) only one fourth of the world average. While China as a whole is facing serious water stress, its problems
are made more severe by the fact that its water resources are unevenly distributed, both spatially and temporally.
In Hai basin- the basin from which Beijing draws some of its water, river flows fall to 70% of their averages one
year in four and to 50% one year in twenty. In Beijing, the per capital availability is only 300 m3/year, making this
megacity extremely water scarce.
China´s water scarcity is aggravated by extensive pollution. Over the past three decades, water pollution has
increased, both in surface water and groundwater. A major contributing factor is that only about 50% of municipal
waste water is treated, versus 92% of the industrial waste water. As a result of continuing pollution, the water
quality of most of China´s water bodies has been extensively degraded.
The central and local governments in China, have increased the water tariffs since early 1990´s- with the tariff
getting close to full cost recovery in particular in the large cities like Beijing. The permitting system is gradually
being upgraded and enforcement strengthened.
The food and beverage sector and its water use
The food and beverage sector in China generates a high value about CNY 1000 billion- equal to value of the
chemicals sector or the power generation sector (National Bureau of Statistics, 2008). The whole industrial sector
account for 20% of the water use in Beijing (2005), and 6% of this is used by the food and beverage industry. In
industry the water recycling level (withdrawal compared to the amount delivered back to the water resource) is
only 40% in average compared to 75-85% in developed countries.
Market dynamics, opportunities for EU businesses from the water sector
The “Most Stringent Water Management System” announced by the State Council early 2013 sets out water
usage, efficiency ratios for water usage for industry and agriculture and water quality measures for each province.
The central government has set the food and beverage industry the target to reduce its water consumption by
30% for each Chinese Yen of industrial value of the production and 10% of the pollutions discharged. According
to market forecasts (GWI) the food and beverage sector is expected to double its capital expenditures from 2007
to 2016, and the market for equipment and services are expected to increase almost at similar rates.
State of technology; adoption of water technology
Production technology and use of resources (energy, water, materials and waste production) varies between food
and beverage sub-sectors. While there is not a study on the present state of technology it is expected that
European SME´s and innovators which deliver technologies, services and equipment for water reuse, process
optimization and waste water treatment will have attractive services and technologies to deliver.
Who are the key stakeholders that the INNOWATER consortium needs to engage with – broken down into the 3
Businesses ‘Gatekeepers’ Others
The key businesses who need
European water innovations. I.e.
the end-users in the food and
Ministry of Water Resources with its
office of Water Resources
Management being responsible for
water resources protection,
distribution and diversion. Directly
below this state level ar the water
resources commissions of the 7
Ministry of Environmental
protection, responsible for emission
control and EIA´s, environmental
monitoring, science and standards,
pollution prevention and control
National Development and Reform
Commission, is responsible for
industrial structure adjustments,
regional economic coordination,
investment and finance
management and state enterprise
Beijing city and Heibei province
administrations on industrial water
and waste water.
Chinese Food and Beverage Sector
EU SME Centre Beijing, can
provide good advice on market
EU China Chamber of Commerce
Main ‘Sponsors’ (to promote technologies and innovation)
Clean Tech Clusters in EU Countries
Innovation support system in EU Countries
Export promotion and support systems in EU Countries
China Europe Water Platform
EU China Policy Dialogue Support Framework
Specific Challenges [t.b.d. during trip]
These specific challenges and potentials will be explored in detail by the consortium when they visit
China and will be used to help build value propositions by European SMEs once the trip has taken
place. This first-hand information will be extremely useful in terms of the follow-up activities with SMEs
once back in Europe.