Can organic vegetables grow in China’s depleted soils? Won’t environmental pollution offset any gains from eating healthy? Aren’t vegetables here, produced by China’s 500 - 600 million farmers, already dirt-cheap? These are just some of the questions I had about a year ago, when a Chinese entrepreneur pitched me on an idea that seemed so ridiculous that I had to remind myself of one of the traditional entrepreneurial litmus tests: If you’ve got an idea so crazy that everybody thinks you’ve lost your marbles, on the contrary you just might be onto something.

In a nutshell, this fellow had agricultural and academic connections to be parlayed into a network of greenhouses. They would be rented to foreigners who wanted to grow their own food. An integrated coffee shop and walking tour would allow people to hang around and watch their vegetables grow precariously from the ceilings. It was to be located in Shanghai’s picturesque and rural Fengxian district.

Although I knew something about the locavore and LOHAS (Lifestyle of Health and Sustainability) concepts, I still wondered if there were really enough green-thumb foreigners in the city to rent his greenhouses and farm their own produce.

“No problem!” he said, “We have people who do the actual farm work.” And what’s more, fresh ten kilogram baskets of the organically grown fruits and vegetables would be delivered to customers’ doors weekly. Ah, a garden without the work! Now he might be onto something.

I passed on the opportunity to invest but recommended the entrepreneur instead focus his marketing on the emerging middle/upper class of Chinese consumers who would be more than eager to eat up healthy vegetables at inflated prices. It turns out I was at least partly right. Before I get to that, let’s review a little Olympic context for organic foods in China.

In the wake of a poisonous dumpling scandal which rocked China-Japan relations in early 2008, China’s pre-Olympic food preparations suffered one indignity after another: The US planned to boycott the Olympic Village food altogether, Australia had to be banned from bringing its own food into the Village (including, it seems, copious quantities of Vegemite - Australia’s favorite spread), and the Olympic Village cafeteria itself would offer only 30 percent of the menu from China’s famous local cuisines. Then perhaps the ultimate loss of face for Chinese gourmands: Usain Bolt’s pre-world-record-setting meal? Chicken nuggets.

I mention the Olympics for its effect of kicking China’s organic foods production up a notch. In order to reassure Olympians - and the world - that China’s food chain was safe, no expense was spared. From RFID-encoded shipments to pigs having Mozart played on their final walk to the abattoir, safety was the number one priority. Number two was health.

In the run up to the Olympics, China has embraced organic foods extremely rapidly. Despite the fact that China has been a producer of organic foods for decades, just two years ago it was hard to find locally-available organic foods in even the foreign-owned hypermarts. Now, fresh, locally-grown organics are not only found in major grocery stores and served in top restaurants, they are even joining the ranks of DIY products.

Vegetable gardens put the commune back in China

Last week in the Shanghai Daily, a pair of organic food stories caught my eye, but this one about the People’s LOHAS Commune in Qingpu District was especially relevant given my experience with the farm/coffee shop/vegetable gallery I was told about last year:

The 33-hectare commune includes 27 hectares of farm land, and a 7-hectare eco-lagoon. The farm is divided into four parts - an orchard, a flower garden, an organic Chinese medicine farm and a vegetable farm.

For only 3,000 yuan (US$441) a year, you can have 3 hectares of land to grow any plant you like, even expensive ginseng.

In Supertrends of Future China, we discuss the growing trend in China of consumers seeking high-quality alternatives and upgrading their lifestyle, adopting activities such as LOHAS originally found in more affluent countries. We believe the trend is just getting started in China, although a number of incumbent businesses such as popular Shanghai eateries Element Fresh and Jujube Tree are already benefitting from the growing segment of health-conscious consumers. The Commune’s proprietor, Xie Lun, seems to share our optimism:

“The People’s LOHAS Commune welcomes everyone who loves nature as long as they observe two simple rules,” Xie says. “The first is no spitting and the second is that other people’s produce must not be taken without their permission. ”

So far more than 400 people, most white-collar workers, have applied to be members of the commune even though it will not officially open until next year.

Although China’s organic food industry is clearly only for affluent locals and foreign residents at this time, this is indeed a trend to watch and get positioned for. China’s own version of Whole Foods of Trader Joe’s may not be far behind.

Categories: Aspiring, China Supertrends, Consuming, Greening