The Chinese cattle marketing system is comprised of familiar structures – including spot markets and more formal systems (vertical integration, groups, contracts) – but there are some features of the Chinese industry that are different to other developing Asian countries.

Like other transition economies, the dismantling of state marketing agencies of the central planning were replaced by the proliferation of spot marketing systems. The density of cattle production in much of China means that there are many hundreds of rudimentary periodic markets in many provinces, but also numerous larger inter-regional marketplaces that provide a range of services (trucking, ties rails, inspection and documentation) to buyers and sellers. Unlike many areas of Asia, farmers in close proximity to markets take and sell their own cattle to markets. Trade in spot markets is conducted by a hierarchy of traders comprised of larger traders and slaughter households that provide cash outlays, down to local level collectors and brokers. The ethnic Hui control the vast majority of activity (90% in the mid-2000s) in the cattle (and sheep and goat) trading and slaughter sectors.

Spot markets consist of an enormous number of buyers and sellers, are generally competitive, with high levels of information (through informal channels). They therefore generally provide an efficient marketing system especially for the trade of generic and low value products. However, spot markets are less effective in terms of generating prices that accurately reflect the true value of more differentiated forms of product. This has led to the development of alternative marketing systems to service mid and high value supply chains.

One of the features of the Chinese beef industry is that a significant proportion of cattle are slaughtered in large abattoirs, where the abattoir (company) itself takes ownership of the cattle (as opposed to numerous small butchers in Southeast Asia that slaughter in service slaughter plants). The abattoirs require supply of cattle to specification, and have incentives to formalise the supply through formal linkages with producers. Thus there are large numbers of company–household linkages in the Chinese beef industry, often through supply contracts and the provision of backward services (feed, breeding, veterinary care). This opens up numerous opportunities for increased industry integration and rural development, but the sector also experiences problems including side-selling and price-grade discounting (see Waldron, 2010).