Food Global Market Report_Sample Pages

Food Global Market Report The Business Research Company

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Food Global Market Report

Food Global Market 2015

The Business Research Company



Contents Food Global Market Report

Food Market Characteristics

o Product Description

o Uses

o Users

o Value Chain

o Raw Materials

o Production and Technologies

o Distribution

o Marketing

Food Drivers and Restraints

o Drivers

o Restraints

Food Future Developments

Food Market Financials

o 5 Years Historic Market Value ($ millions)

o 5 Years Historic Market Volume

o 5 Years Forecast Market Value ($ millions)

o 5 Years Forecast Market Volume

o Average Net And Operating Margins

o Average Cost Of Capital

Food Market Segmentation

o Sub Market Segmentation

o Soft Drink and Ice Manufacturing, All Other Food Manufacturing, Seasoning and

Dressing Manufacturing, Flavoring Syrup and Concentrate Manufacturing, Coffee

and Tea Manufacturing, Snack Food Manufacturing, Cookie, Cracker, Pasta, and

Tortilla Manufacturing, Bread and Bakery Product Manufacturing, Seafood Product

Preparation and Packaging, Poultry Processing, Animal (Except Poultry) Slaughtering,

Rendering, and Processing, Ice Cream and Frozen Dessert Manufacturing, Dry,

Condensed, and Evaporated Dairy Product Manufacturing, Cheese Manufacturing,

Fluid Milk and Butter Manufacturing, Fruit and Vegetable Canning, Pickling, And

Drying, Frozen Food Manufacturing, Sugar and Confectionery Product

Manufacturing, Breakfast Cereal Manufacturing, Fats and Oils Refining and Blending,

Wet Corn Milling and Flour Milling and Malt Manufacturing.

o End Customer Segmentation

Food Market Regional Overview

o Global Overview

o Europe, France, Germany, Italy, Russia, Spain, United Kingdom, Rest of Europe-

Market Size

o Americas, Brazil, United States, Rest of Americas- Market Size



o Middle East, Saudi Arabia, United Arab Emirates, Rest of Middle East- Market Size

o Africa, Nigeria, South Africa, Rest of Africa- Market Size

o Asia, Australia, China, India, Japan, Rest of Asia- Market Size

Food Competitive Landscape

o Competitive Market Structure

o Porter’s five forces analysis

o Market Shares

o Company Profiles

o Nestle, Mondelēz International, Archer Daniels Midlan, Danone, Wilmar

International, General Mills, Kraft Foods, JBS Associated, British Foods and Tyson

Foods.

Food Customer Information

End User Groups

Preferences

Behaviours

Food Market Suggested Strategies

o Placement

o Positioning

o Price

o Product

Interview Summaries

Appendix

Methodology

Note: Report will require up to 2-3 weeks in order to update with the latest data and customize

for the client. Some small sections of the TOC may not be relevant/possible for some reports,

where this is significant it will be discussed with the client.



Food Global Market Characteristics The companies and manufacturers in the food industry process food raw materials into food

products, package and distribute them through various distribution channels to reach end

consumers. The end products of the food processing industry are classified into four main

categories: beverages, food, pet food and tobacco.

These four categories are further classified into the following segments: beverages includes alcoholic

drinks, soft drinks, juices, milk-based drinks, tea and coffee. Breakfast cereals, bread and bakery

products, cheese, meat-, vegetable- and fruit-based products are some of those that come into the

food category. Pet food includes dog and cat food and other animal food. Cigarettes, cigars and

smokeless tobacco are covered under the tobacco products category.

The food industry can be classified into two major parts, production and distribution.

Typical food processing steps include cleaning, trimming, slicing, shredding, extraction of plant

products, milling and malting, fermentation and refining. After the processing is complete these



Food Global Market Size 2015 The total value of the food sector globally in 2014 was $6 billion. Related to a world population of

more than 7 billion in 2014 this equates to about $ per person globally. Given that World Domestic

Product was approximately $ trillion in 2014i, the food processing market makes up about % of the

global economy.

The amount and value of food consumption varies widely between regions. According to FAOSTAT,

the global average kilocalories (kcal) per capita food consumption per day in 2015 is 2940; the

highest regions are the developed countries with 3440 kcal per capita per day, followed by the Near

East and North Africa with 3090 kcal per capita per day and East Asia and transition countries with

2906 kcal per capita per day. Sub- Saharan Africa region had the lowest kcal per capita consumption

per day in the world at 2360ii.

Much of the value of processed food is related to image and perception. According to the report

“100 Most Valuable Global Brands 2014” by Millward Brown, McDonald’s is the highest value fast

food brand worldwide in 2014 with a total brand value of $85.7 billion, followed by Starbucks and

Subway with total brand values of $25.7 billion and $21.0 billion in 2014 respectivelyiii.



Food Global Market Historic Growth The food sector grew from $ billion in 2010 to $ billion in 2014 at a compound annual growth rate

(CAGR) of 4.9%.

Figure 1: Food Market, Historic Market Size, 2010-2014

The Business Research Company Sources: Reportlinkeriv, UN Statsv, TBRC Analysis

Drivers of the Market

The key drivers of the food industry during 2010-2014 included:

Low Cost Foods: Frozen food sales increased during the recession as many consumers chose eating

at home over eating in restaurants due to reduced household budgets. In addition, many consumers

feel frozen foods help in reducing expenses as wastage is less and trips to the supermarket are

reduced. Frozen foods are also easy to prepare. Going forward, growing consumer demand for

convenience foods is expected to continue driving growth in this sector.

Emerging Market Growth: According to the World Bank, the world’s middle class population –

defined as that earning between $10 and $100 per day – increased from approximately 1.5 to 2

billion between 2010 and 2014vi. This change was driven mainly by growth in the emerging markets

such as China and India. Increased earnings greatly increased disposable incomes in the emerging

market. With rising income levels, consumption in developing countries is shifting from raw food

purchases towards packaged food productsvii.

Restraints on the Market

The key restraints of the food industry during the period 2010-2014 included:

Weak Wage Growth in Developed Economies - The period 2010-2014 saw limited wage growth in

most developed economies and a decline in wages in some of these economies. Median income

growth in the USA for example was at or below 0% during most of this periodviii. Low wage growth of



this kind decreases peoples’ disposable income and reduces the demand for the more expensive

packaged foods.

Price sensitivity: The food retail business is largely driven by consumer preferences. Affected by the

global slowdown, consumers have become price conscious and turned to cheaper foods. Sales of

frozen foods thus jumped after the financial crisis as these foods are cheaper and can be made at

home easily. Moreover, sales of fast food restaurants such as McDonald’s have gone up due to the

availability of lower priced food optionsix.

Health Consciousness Increases in Developed Economies People in the developed world have

become increasingly concerned about the sugar and salt content of processed foods. This has led to

a shift away from these products.



Food Global Market Segmentation The largest market segments in the food sector were general animal slaughtering, rendering and

processing products and poultry processed products as of 2014.

General animal slaughtering, rendering and processing was the largest segment in the food market

at % of the global market, worth about $ billion. The global demand for processed meat is expected

to grow; China and India particularly are expected to have the highest growth rate due to the

growing middle classx.

Poultry processed products was the third most important sector at % of the global market, worth

about $ billion. Poultry is the fastest growing segment in the livestock market and its production is

expected to rapidly increase due to its lower price compared to other types of meat. China, Brazil

and the USA are expected to have the highest increase in poultry production in the coming decadexi.

Tobacco products constituted % and bread and bakery products % of the global market, worth

about $ billion and $ billion respectively. According to the World Health Organization WHO, global

consumption of tobacco shows a declining rate, mainly due to the steps taken by governments to

introduce plain packaging and include large pictorial warnings on cigarette packagesxii.

Figure 2: Food Sector, Market Segments, 2014(e)

The Business Research Company Sources: :ibis worldxiii, Transparency market researchxiv, .Food product designxv, ICOxvi, Confectionerynewsxvii, Foodbusinessnewsxviii,UN Statsxix, TBRC Analysis



Food Global Market Geography Split The largest market segments in the food sector were Asia, Americas, Middle East and Africa as of

2014.

Asia was the largest region in the food industry at % of the global market, worth about $ billion.

Asia is expected to continue to be the leading region in food industry with an increase in its young

population, growing urban life style, increasing preference for processed food and increasing

awareness of the different product options.

The Americas was the second largest region at % of the global market, worth about $ billion in

market value.

The Middle East and Africa was the third most important region at % of the global market, worth

about $ billion in market value.

Other significant regions include Europe and Oceania.

Figure 3: Food Market, Geographies, 2014(e)

The Business Research Company Sources: : Frost and Sullivanxx,UN Statsxxi, TBRC Analysis



Food Global Market Competitors The food market is fragmented. The top five competitors in the market made up % of the total

market in 2014. Nestlé was the largest competitor with % of the market, followed by Archer Daniels

Midland with % and Philip Morris with %.

Figure 4: Global Food Market, Top Competitor Shares, 2014(e)

The Business Research Company Sources:Company Annual Reportsxxii,UN Statsxxiii, TBRC Analysis

Nestlé

Nestlé company was the largest in the market in 2014 with a % share. It has more than 2000 brands

and is present in more than 190 countriesxxiv. Its products are divided into various business divisions,

such as baby foods, cereals, chocolate and confectionery, coffee, dairy, drinks, healthcare nutrition,

pet care and weight managementxxv.

Nestlé’s objective is to be the leader in nutritional health and wellness, and the industry reference

for financial performance, trusted by all stakeholders. The strategy to achieve this is through

focusing on three main factors:

1) Growth drivers

2) Competitive advantages

3) Operational pillarsxxvi.

Nestlé had revenues of $99.9 billion for the financial year 2014, a 0.5% increase from the previous

year. It had net profit of $15.7 billion for the financial year 2014, a 46% increase from the previous

yearxxvii.The company had a market capitalization of $247.3 billion as of May 2015xxviii.



Food Global Market Key Mergers and Acquisitions

Merger and acquisition activity in the food market in the last 3 years has been high. Leading deals

have included those done by Heinz and Kraft, Tyson Foods, Yildiz Holdings.

Tyson Foods – Tyson Foods acquired Hillshire Brands at $8.5 billion; this is the biggest deal yet in the

global meat marketxxix.

General Mills – General Mills acquired Annie, a specialty food maker for $820 million. Annie claims

that its products are made without artificial flavors, synthetic colors, or preservatives. Annie’s

growth as a company corresponds to the recent growth in consumer demand for organic and

healthier food. This acquisition is expected to help General Mills expand its presence in the organic

and natural foods industryxxx.

Yildiz – Yildiz Holdings, a Turkish food group, bought UK based United Biscuits for $3.2 billion in

2014, which made Yildiz the world’s third largest biscuit makerxxxi.

Heinz – Heinz bought Kraft Foods to become the fifth largest food and beverage company in the

world with the total annual sales of $28 billion. 3G capital and Berkshire Hathway the two

investments firms jointly created a new company The Kraft Heinz company through the merger of

H.J Heinz Co. and The Kraft Foods Groupxxxii.



Appendix Abbreviations

CAGR stands for Compound Annual Growth Rate

Currencies

$ stands for US Dollar

€ stands for Euro

All other currencies are given with ISO currency codes.

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ihttp://databank.worldbank.org/data/download/GDP.pdf ii http://www.fao.org/docrep/005/ac911e/ac911e05.htm iii http://www.millwardbrown.com/docs/default-source/global-brandz-downloads/global/2014_BrandZ_Top100_Report.pdf ivhttp://www.reportlinker.com/p0127246-summary/Global-Food-Retail.html vhttp://unstats.un.org/unsd/snaama/dnllist.asp vihttp://www.ey.com/GL/en/Issues/Driving-growth/Middle-class-growth-in-emerging-markets viihttp://www.eufic.org/article/en/diet-related-diseases/obesity/artid/stevia-natural-sweetenerwith-potential/ viiihttp://www.multpl.com/us-median-income-growth ixhttp://www.consumerpsychologist.com/food_Price_and_Competition.html

mailto:[email protected]



xhttp://www.businessinsider.in/How-People-Consume-Meat-Around-The-World-CHARTS/articleshow/28763864.cms xihttp://www.businessinsider.in/How-People-Consume-Meat-Around-The-World-CHARTS/articleshow/28763864.cms xiihttp://www.who.int/mediacentre/news/releases/2015/trends-tobacco-use/en/ xiiihttp://www.ibisworld.com/industry/global/global-spirits-manufacturing.html http://www.ibisworld.com/industry/global/global-wine-manufacturing.html http://www.ibisworld.com/industry/global/global-beer-manufacturing.html http://www.ibisworld.com/industry/global/global-bakery-goods-manufacturing.html xivhttp://www.transparencymarketresearch.com/global-cheese-market.html http://www.transparencymarketresearch.com/pressrelease/global-frozen-foods-market.htm http://globenewswire.com/news-release/2015/05/22/738509/10135710/en/Seasonings-and-Spices-Market-Will-Reach-USD-16-6-Billion-Globally-by-2019-Transparency-Market-Research.html http://www.transparencymarketresearch.com/pressrelease/global-tea-market.htm http://www.prnewswire.com/news-releases/pet-food-market-to-be-worth-us748-billion-globally-in-2017-transparency-market-research-278683701.html xvhttp://www.foodproductdesign.com/blogs/trending-foods/2014/08/bagged-salad-produce-sector-worth-7-billion-by-20.aspx xvihttp://www.ico.org/news/icc-111-5-r1e-world-coffee-outlook.pdf xviihttp://www.confectionerynews.com/Markets/Where-are-the-world-s-largest-confectionery-markets xviiihttp://www.foodbusinessnews.net/articles/news_home/Consumer_Trends/2014/02/Report_Global_breakfast_cereal.aspx?ID=%7B587FC363-F568-4088-B844-1A795384C7C0%7D&cck=1 xixhttp://unstats.un.org/unsd/snaama/dnllist.asp xxhttp://www.slideshare.net/FrostandSullivan/2020-vision-global-food-beverage-industry-outlook xxihttp://unstats.un.org/unsd/snaama/dnllist.asp xxii https://www.nestle.com/asset-library/documents/library/documents/annual_reports/2014-annual-report-en.pdf http://www.adm.com/en-US/company/Facts/Pages/default.aspx http://www.pmi.com/eng/about_us/company_overview/pages/key_facts_and_financial_data.aspx http://www.pepsico.com/company http://www.ab-inbev.com/content/dam/universaltemplate/abinbev/pdf/investors/annual-and-hy-reports/2014/AB_InBev_AR14_EN_full.pdf http://www.coca-colacompany.com/our-company/infographic-coca-cola-at-a-glance http://www.chsinc.com/~/media/chs%20inc/files/pdfs/global%20fact%20brochures/2015%20fact%20brochure.ashx?la=en http://ir.tyson.com/investor-relations/investor-overview/tyson-factbook/ http://www.mondelezinternational.com/~/media/MondelezCorporate/Uploads/downloads/mondelez_intl_fact_sheet.pdf http://www.kraftheinzcompany.com/KraftHeinzCompany_FactSheet.pdf http://www.altria.com/AnnualReport/2014/pdf/Altria_2014AR_CompleteAnnualReport.pdf https://www.google.co.in/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&cad=rja&uact=8&ved=0CB0QFjAAahUKEwjpw4DF0cHIAhXXWo4KHaixABY&url=https%3A%2F%2Fwww.generalmills.com%2FNews%2F~%2Fmedia%2F660463DE7E344969A4F39771716E4E77.ashx&usg=AFQjCNHPi8__u2RtEDLydvNzC_Em0NI9OQ xxiiihttp://unstats.un.org/unsd/snaama/dnllist.asp xxivhttp://www.nestle.com/aboutus xxvhttp://www.nestle.com/brands xxvihttp://www.nestle.com/aboutus/strategy xxviihttp://www.nestle.com/asset-library/documents/library/documents/annual_reports/2014-annual-report-en.pdf xxviiihttp://www.forbes.com/companies/nestle/ xxixhttp://www.cnbc.com/2014/06/09/tyson-to-acquire-hillshire-brands-for-63-a-share-in-cash.html xxxhttp://www.forbes.com/sites/briansolomon/2014/09/08/buying-organic-general-mills-swallows-annies-for-820-million/ xxxihttp://www.reuters.com/article/2014/11/04/yildizholding-unitedbiscuits-idUSL6N0SU4G320141104 xxxiihttp://www.forbes.com/sites/greatspeculations/2015/03/30/analysis-of-the-kraft-heinz-merger/

http://www.ibisworld.com/industry/global/global-spirits-manufacturing.html

http://www.ibisworld.com/industry/global/global-wine-manufacturing.html

http://www.ibisworld.com/industry/global/global-beer-manufacturing.html

http://www.transparencymarketresearch.com/global-cheese-market.html

http://www.transparencymarketresearch.com/pressrelease/global-frozen-foods-market.htm

http://globenewswire.com/news-release/2015/05/22/738509/10135710/en/Seasonings-and-Spices-Market-Will-Reach-USD-16-6-Billion-Globally-by-2019-Transparency-Market-Research.html

http://globenewswire.com/news-release/2015/05/22/738509/10135710/en/Seasonings-and-Spices-Market-Will-Reach-USD-16-6-Billion-Globally-by-2019-Transparency-Market-Research.html

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