Falling instant-noodle sales points to the economic rise of rural China
- China is selling 8 billion fewer packets of instant noodles than it was in 2013.
- Fewer local migrants from rural China are moving to cities, which is affecting sales.
- Instead, workers are staying in rural areas of China where annual incomes are rising at a faster rate than in cities.
People in China are eating billions fewer packets of instant noodles every year, state-run Global Times reported Monday.
According to the World Instant Noodles Association, China and Hong Kong ate 46.2 billion packets in 2013. By 2016 that had dropped by 8 billion packets to 38.5 billion. And more than one major manufacturer has experienced a drop in profit over 25%.
While the popularity of on-demand food services, that provide cheap, quick food to China's growing middle class, are impacting instant noodle sales, another key contributor is the rise of rural China.
An economic professor at Tongji University, Zhang Xin, told the Global Times sales have plunged because far fewer low-paid local migrants from rural China are moving to or living in cities, where they are one of the biggest consumers of instant noodles.
Between 2010 to 2016, the growth in migrant workers looking for work away from home dropped off significantly from 5.2% to 0.5%. And in 2015, the migrant population decreased for the first time in 30 years.
Instead, more workers are returning to their hometowns after acquiring skills or money in the cities or choosing not to leave in the first place because of increased opportunities.
Over the last seven years, the annual net income in rural China has outpaced the growth of that in urban centers. And, by 2020, China is hoping to double all salaries from their 2010 levels.
Big tech in China is also playing their part. Both Alibaba and JD.com have begun implementing projects to connect rural sellers with buyers across the country, with the hope of raising local incomes.
High-speed trains are also killing the instant noodle
Better infrastructure is also hurting the instant noodle market in China.
Long train journeys back to rural hometowns used to be standard in China, where there were no high-speed trains a decade ago. Now the country has the world's largest high-speed train network, running over 12,400 miles (20,000 kilometers).
While this has drastically cut journey times, it has also cut the number of meals that workers would have on board the trains.
One traveller told Global Times his 20 hour trip, where he used to eat three meals, now only takes six hours so he no longer needs to eat instant noodles. Other travellers are using a pilot program at 27 stations to order food on-demand.
As a result, instant-noodle orders from trains have also dropped off.