Staple Foods: Half-year Update H1 2024

Delivery

This report comes in PPT.

Key Findings

Retail value and volume sales of cakes and pastries have been revised downwards as consumers reduce their discretionary purchases

Cakes and pastries were more exposed to food inflation than other staples (such as bread, where grain prices had declined from peaks during the period of the last half-year review) as prices of commodities that are widely used in this category have risen substantially, with cocoa being at the forefront. In addition, rising health concerns around processed food in key markets, such as the US, represent a significant issue hindering the category’s growth.

Volume sales of breakfast cereals are set to return to pre-COVID-19 levels

Breakfast cereals have seen both retail value and volume sales revised upward in 2024. Volume sales are expected to benefit from higher expenditure on health and wellness products, while inflation will be the largest contributor to the forecast growth in retail value sales in current value terms, with its impact lifted further after the Half-Year Review.

Retail value and volume sales of processed meat are set to benefit from decreasing feed costs and increased production

Processed meat is expected to benefit from increasing production in leading meat-producing countries, such as Brazil and Australia. This will also diminish the overall impact of price on volume consumption amid the cost-of-living crisis.

Retail value sales of rice have seen opposite updates in its leading markets, China and India

Rice’s retail value sales have undergone a revision in its leading markets, China and India. In China, the weakening currency against the US dollar has resulted in a downward revision, while increasing product prices, due to poorer harvests driven by dry weather conditions, have led to an upward revision in India.