Frost & Sullivan: The juice market enters a health-conscious upgrade phase, with pure juice becoming a structural growth driver

In recent years, the overall scale of China's soft drink industry has continued to expand, growing from about 986.7 billion yuan in 2020 to about 1,206.6 billion yuan in 2024. Currently, China's soft drink industry has entered a new stage of structural upgrade and quality improvement from a rapid growth phase, with consumers' demand for healthy, natural, and functional beverages significantly increasing.

As an important segment of the beverage industry, as of 2024, the market size of Chinese juice was about 158.4 billion yuan, accounting for about 13% of the overall soft drink market. In recent years, the juice category has also been improving quality and upgrading simultaneously, with significant growth in the pure juice category. Juice in the soft drink market is gradually shifting from a "quenching" beverage to a "healthy and nutritious" beverage, playing the role of representing consumption upgrade and quality life.

In 2024, the market size of Chinese pure juice (including FC and NFC) was about 36.7 billion yuan, accounting for about 23% of the overall juice market. Over the past few decades, the pure juice market has evolved from being dominated by foreign investment to a rise of domestic brands and then to a diversified competitive landscape.

In the early days, the Chinese beverage market was mainly composed of soda beverages and fruit-flavored beverages. At the beginning of 1986, local Chinese juice brands began to emerge, such as Coconut Tree Coconut Juice and Tianjin Orange Treasure Orange Juice, symbolizing the vigorous development of the domestic juice industry. After 1990, local brands such as Huiyuan and Nongfu Spring rapidly expanded through channel penetration and cost-effective strategies; in addition, Cool Kids, Unifree Fresh Orange Multi, and Meiji Juice also actively laid out their markets on the Chinese mainland; since 2010, with the continuous upgrading and popularization of sterilization technology, brands such as Weiquan, Zero Degree Fruit House, and Daily Fresh have promoted high-end upgrades, presenting a dual-track parallel pattern of "FC popularization and NFC high-endization" in the market. Currently, the market has gradually shifted from single-price competition to comprehensive competition in terms of quality, technology, and brand experience.

Huiyuan still occupies a relatively leading position in the mid- to high-concentration juice and FC pure juice markets. At the supply chain end, Huiyuan has an integrated ability from planting to production and processing, and has a first-mover advantage in the layout of upstream fruit planting. In terms of product dimension, Huiyuan has a comprehensive coverage of juice concentration and taste in the juice track, but its production method is single, mainly concentrated and reduced; Huiyuan's juice products are mostly single-branded, with competitive unit retail prices, rich juice categories, and a wide price range, but the application and development process of new technologies is relatively slow, failing to quickly capture the trend of consumption upgrade;

In terms of channel structure, Huiyuan's online channels and CVS channels are inferior to competitors such as Nongfu Spring and Unifree, mainly relying on the comprehensive operation of dealers' KA supermarkets and direct company channel layout. At the marketing strategy level, Nongfu Spring, Weiquan, etc. have established relatively mature brand and channel coverage in the market, with obvious marketing and channel expansion, but Huiyuan's marketing activities are relatively conservative, and its layout in the new retail and convenience store system is weak.

In contrast, Weiquan's refrigerated FC series products have quickly established a reputation among urban white-collar consumers through convenience store scenario layout; Nongfu Spring has successfully captured the high-end market with its "100% NFC" series and full-channel marketing, and is better at brand rejuvenation and product creation.

It is expected that from 2024 to 2029, the annual compound growth rate of the Chinese juice market will remain at a low single-digit growth rate, but the growth rate of the pure juice category is expected to reach nearly 10%, significantly higher than the overall industry.

We define the juice track as a "structural growth track driven by health upgrade". It is no longer a traditional soft drink branch, and the consumption of low-concentration juice will continue to decline; in order for the juice market to integrate high-potential categories such as healthy consumption, quality life, and diversified scenario combinations. Future growth mainly comes from increased consumption frequency, price increase, and diversified categories.

Today's juice production technology has become increasingly mature, but strict control over raw materials and the adoption of more advanced production processes remain the competitive advantages of current mainstream brands. Upstream construction is a "necessary but not sufficient" condition, which ensures product differentiation and supply chain security, but without strong channel and brand capabilities, it is difficult to achieve large-scale commercial success. Therefore, we believe that the "strong upstream control + wide channel coverage + strong brand awareness" three-wheel drive will be the most core competitiveness of brands.