“Increased urbanisation, rising levels of disposable incomes, exposure to western culture and cuisines, including dieting habits, are some of the key factors stimulating growth in the bakery and cereals market in Asia-Pacific,” says Nikhil Aggarwal, senior consumer goods analyst at Datamonitor.
Consumers are increasingly demanding options that are not only healthy but also quick and easier to consume when pressed for time. For example, within the breakfast cereals subcategory in Asia, consumers are looking for healthy, low-fat offerings with more fibre that are fortified with vitamins and minerals, promising health benefits that include weight management.
Furthermore, the developing organised retail system within the Asia-Pacific region will increase product visibility and availability, which is expected to act as a growth stimulus. As urban markets reach high penetration levels, companies are expected to dedicate significant resources into expanding distribution networks to reach large, lucrative, yet untapped rural markets.
“An affinity for healthy offerings is a key trend that reflects global consumer packaged goods (CPG) sentiments, and the bakery and cereals segment in Asia-Pacific is no exception,” adds Nikhil Aggarwal, based in India.
The bakery and cereals market in Asia-Pacific is led by cakes & pastries (representing 48.5% of the segment), followed by bread & rolls and cookies (sweet biscuits), with 23.2% and 14.9% market share, respectively. Crackers (savoury biscuits), breakfast cereals and morning goods constitute the remaining categories with a 7.1%, 4.9% and 1.3% market share, respectively.
The breakfast cereals category is expected to achieve sales worth $2.8bn this year, representing year-on-year growth of 6.3% over 2009. The category was valued at $2.5bn in 2008, representing a CAGR of 5.9% since 2003.
“The appeal of convenience as well as the overwhelming demand for healthy alternatives is expected to drive sales within the breakfast cereals category, specifically the ready-to-eat variety,” says Nikhil.
Datamonitor’s ‘Recovery from Recession’ (RfR) service, which tracks global consumer spending intentions on a monthly basis, found that the majority of consumers in the Asia-Pacific region have no intention of reducing their spend in the bakery and cereals aisle. In April 2010, for example, 68% of Australian consumers reported they would be maintaining their level of expenditure on cereals – considerably higher than the proportion who said the same about confectionery (45%).
In China, 56% of consumers said they would maintain cereal spend, while a substantial minority of 11% said they would actually be increasing their expenditure in this category, reflecting the potential of such products in the Asia-Pacific region.
By the end of 2013, it’s expected that the breakfast cereals category will be worth $3.3bn, with a CAGR of 6% between 2008 and 2013.
© FoodBev Media Ltd 2021
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