Global Bakery Highlights and Prospects for 2011-2016
Retail value sales of bakery products are expected to rise on the back of higher commodity prices and stronger demand in emerging economies, accoring to the latest research by Euromonitor.
Background
2011 will be a year dominated by wheat and corn-driven rises in commodity prices, which will hamper the growth of bakery products in volume terms. International manufacturers are adjusting to this trend by highlighting the added value of their brands. In doing so, they are trying to compete with private label offerings, perceived as low in price and gaining in quality and sophistication every year.
Market performance
Bakery product sales are expected to grow by 1.6% in retail value in 2011 (constant 2011 prices/fixed 2011 exchange rates), 1.4 percentage points up on the growth registered the previous year. Retail value sales are projected to reach US$462 billion in 2011. Part of this growth can be explained by the increase in input costs, especially corn and wheat, which are set to push bakery product global unit prices up by 2% in 2011.
Regional performance
Western Europe and Latin America are predicted to remain the largest bakery product markets, accounting respectively for 32% and 20% of global retail value in 2011. Latin America will be one of the strongest performers, with bakery products growing by 4% in retail value (constant 2011 prices/fixed 2011 exchange rates). Brazil’s strong economic growth in 2011 will underpin demand for high added value in key bakery categories. Retail value sales of packaged/industrial bread, for instance, will grow by 11% in 2001, driven by strong innovation activity among local manufacturers and stronger awareness of functional benefits among urban Brazilian consumers.
Category performance
Biscuits is the category predicted to register the strongest growth, rising by 2.4% in retail value in 2011(constant 2011 prices/fixed 2011 exchange rates) at world level. Global demand for biscuits in 2011 will be underpinned by strong sales growth in Latin America, where sales are expected to grow by 4% in retail value.
Baked goods are expected to grow globally by 2% in 2011, a performance underpinned by strong demand in Latin America, which will see sales rise by 4% in retail value. Breakfast cereals will be the weakest category in terms of growth, with sales predicted to grow by just 1% in 2011. Global demand for breakfast cereals in 2011 will be hampered by sluggish growth in Western Europe, where sales are expected to decline by 0.4%.