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Retail value sales of bakery products in North and South America combined reached US$147 billion in 2009, up 4% on the previous year (fixed 2009 exchange rates). Euromonitor International found that maturing consumer demand and pressure on prices from private label manufacturers constrained retail value growth of bakery sales in North America (+2%) in 2009. In contrast, economic growth and a gradual trade up from artisanal to industrial bakery products boosted growth in South America, which achieved retail value growth of 7% in 2009.
In qualitative terms, research shows quite different patterns between the northern and southern parts of the region, according to Euromonitor International. North America is quite a mature market, with innovation heavily focused on premium and health lines.
In contrast, while premium and health lines are expanding rapidly in South America, mass-market brands and artisanal lines continue to account for the lion’s share of total sales, particularly in rural areas.
While not necessarily recession-proof, baked goods appear to be recession-resistant. Value played an important part in baked goods’ performance as consumer purchasing behaviour shifted down during the recession year. 2009 saw many US consumers trading down from premium to mainstream products, and others from branded offerings to private label products.
In terms of products, demand for bread was underpinned by consumers looking for inexpensive food options, with US shoppers brown-bagging their lunches more frequently. Bread sales grew by 3% in retail value in 2009, according to Euromonitor International’s estimates. Conversely, sweet biscuit sales suffered as consumers scaled back consumption of indulgence products and impulse items in favour of nutritional staples that provide multiple uses.
Savoury biscuits and crackers were the only biscuit type to post both value and volume sales gains in 2009, with retail value sales up by 2%. A relatively low unit price has underpinned the expansion of these products in the midst of the economic crisis, gaining ground on more expensive sweet biscuits. Furthermore, savoury biscuits are generally seen as healthier options than sweet biscuits for snacking, and lend themselves well to whole grain or low-sodium extensions. US manufacturers which have typically not offered whole grain or natural crackers are beginning to introduce these types of products, a trend that is likely to continue in 2010.