Chinese bakery and cereals market to hit $47bn by 2018

Friday, 08 August, 2014

The Chinese bakery and cereals market is not only the world’s largest by volume, but is set to become the second-most valuable. According to new research from Canadean, the market is expected to reach $47 billion by 2018, second only to the US.

Per capita consumption of bakery and cereals is still low and indicates room for further growth, Canadean says. The average Chinese consumer only eats bakery or cereal products on 92 occasions each year - far lower than the European average. In comparison, the average German, for instance, eats bakery or cereal products on 731 occasions each year.

While European consumers prefer bread and bread rolls, cakes, pastries and sweet pies are more popular with Chinese consumers. These products currently account for 43.9% of China’s market share.

More Chinese consumers will be exposed to packaged goods as young migrants move from rural to urban areas to seek better opportunities.

“Growing urbanisation will promote the growth of the Chinese middle class which, in turn, will lead to a demand for a wider range of products,” said Canadean analyst Veronika Zhupanova.

These new urban dwellers’ busy lifestyles will see them seek on-the-go products, Canadean says.

“Manufacturers should take advantage of this trend and produce bakery and cereals items that serve as an energy boost for busy Chinese who skipped breakfast or need a snack break at work. Single-serve packed items, such as Tao Li’s red bean paste Dorayaki, will sell particularly well during office hours, whereas multipacks of ambient and individually packed items will be suitable for tired consumers who are looking for a treat after a long day of work,” said Zhupanova.

These findings are from Canadean’s report ‘Consumer Trends Analysis: Understanding Consumer Trends and Drivers of Behaviour in China’s Bakery & Cereals Market’.

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