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Whole Grain Market Endures RecessionWhole Grain Market Endures Recession

January 5, 2011

4 Min Read
Whole Grain Market Endures Recession

SAN JOSEThe global market for whole grain and high-fiber foods was not greatly affected by the economic slowdown, according to a new report by Global Industry Analysts Inc (GIA). The overall market experienced slower growth rates during 2008 and 2009 compared to 2007, but bread and cereal withstood the recessionary impact fairly well. Blended flours are also gaining popularity among consumers wishing to consume whole grains, but averse to the taste, flavor and texture of whole grain flour or products. Additionally, consumers have shown a preference for natural breads and sandwiches comprising vitamins, whole grains and fiber.

In 2009, global bread products sales, a baked food considered an essential staple in most of the economies, increased by more than 5 percent over 2008 at retail level. Breakfast cereal was preferred over other morning foods owing to the nutritional content and economical pricing. Nevertheless, despite the increase in demand for cereals, manufacturers of branded breakfast cereals faced challenging times as consumers looking for value, traded down to less-expensive private-labels.

Cereals tend to be the predominant choice of breakfast in the United States, U.K. and Australia. In these countries, the market is highly competitive with higher levels of expenditure on product promotions. About 35 percent of the global cereal product launches in 2009 claimed to be functional cereals with health benefits. Usage of whole grains and reduction of fat and sugar levels were some of the most popular claims in the new products rolled out during the year. Similarly, inclusion of fruits in cereals was another widely prevalent trend, aiming to give a healthier image makeover to cereals.

By product, Cereals represents the largest segment, while Baked Food is poised to emerge as the fastest growing market over the analysis period. The increasing demand for natural bakery products with ingredients such as fiber and whole grain is expected to fuel the overall demand for baked food

Despite decreased popularity of organic products in the United States and Europe, new product launches in the category were apparently unaffected. New organic product launches in the cereals segment, doubled between the years 2007 and 2009.

The global market for whole grain and high fiber foods is forecast to reach over US$24 billion by the year 2015. The United States constitutes the largest regional market for whole grain and high fiber foods, as stated by the new market research report on whole grain and high fiber foods. The dominance of the U.S. market is likely to continue, backed by increased adoption of rice, wheat, barley as well as various specialty grains among consumers, nutritionists and dieticians. Europe and Asia-Pacific follow trail as the next major markets. Demand for whole grain and high fiber foods in Asia-Pacific is projected to grow at the overall fastest compound growth rate of 6 percent through 2015. The increasing health orientation among the upper and middle class consumers in the developing regions would drive the urban demand for value-added products.

Raising consumer awareness about the dietary significance of whole grain and high-fiber foods is one of the major factors contributing to higher consumption of such foods, the market analyst company reported. With several studies corroborating the harmful impact of diets involving high proportion of processed foods, consumers are awakening to the need for healthy food into their daily diet. Consumers are increasingly becoming aware about adopting wholesome and healthy food habits to promote digestive and cardiovascular health. The shift in consumer perception and trends can be attributed to greater investments towards consumer education, intense promotional activities and availability of products with improved tastes and flavors.

GIA predicts the release of the new Dietary Guidelines in the United States, as well as the MyPyramid food guidance system are expected to push up the sales of healthy food products, particularly those involving whole grains. The impact of these specifications is not just limited to the United States, but is expected to significantly alter the consumption trends across the world.

The trend has compelled manufacturers to develop new and innovative products to keep pace with the burgeoning demand for such foods. Though both whole grains and fibers are vital for ensuring optimal health benefits for human beings, whole grains are being promoted extensively as they are also abundant in fiber content.

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