Packaged Food 2011 (Part 3): Finding Success in a Challenging Operating Environment

Introduction

Scope

Objectives of three-part global briefing

Learn more about latest developments in the global food industry

Key findings

Making Sense of Food Prices

Are food prices going up?

Global food production not keeping up with population growth

Commodity speculation mounts on the back of cheap US dollar

Global cereal prices remain elevated relative to mid-2010

Soybean prices remain high but are finally starting to come down

Global sugar prices prove stubbornly high despite dip in H1 2011

Cocoa prices falling as stability returns to Côte d'Ivoire

Food inflation an increasing cause for concern in China

Rising input costs, aspiration drive up average retail prices in Brazil

Russian packaged food retail prices increasing slightly

US packaged food average retail prices also on the rise

US chocolate and vegetable oil retail prices rise sharply

Are average retail food prices going up?

Packaged food retail price movements by region

Retail bread prices holding steady across several markets

Retail chocolate prices mainly see real terms declines worldwide

Retail Distribution Landscape

Inexorable consumer shift to modern grocery retail formats

Modern grocery formats gain share, drive down food retail prices

Consumers in emerging markets seduced by modern grocery

Supermarket price wars helping to ease general inflation in the UK

Is the end of traditional grocery formats nigh?

Retail price comparisons between traditional and modern channels

Retail prices in traditional and modern formats in emerging markets

What do consumers love more, stores or brands?

Competitive Landscape

Where there's retailer consolidation, there's private label

Private label packaged food leverages significant cost savings

Expansion of modern grocery formats supports private label share

Global packaged food market remains extremely fragmented

Are greater economies of scale required for brands to compete?

Impact of volatile food input costs to packaged food M&A

Alternatives to M&A to boost efficiency and offset rising costs

Emerging markets can support squeezed manufacturer margins

Different levels of market penetration in emerging regions

Private label packaged food underperforms in emerging markets

Global private label performance by packaged food category

Added Value Innovations

Consumers continue to demand added value packaged food

Wrigley's 5 gum successfully taps into hip and trendy consumers

Cadbury's Dairy Milk adds value with ethical positioning

Chobani Greek yoghurt leverages appeal of all natural lifestyle

" Snackifying " the Ukrainian packaged food market

" Snackifying " food to protect squeezed margins

Parle Milk Power biscuits taps health and convenience in India

Finding the right added value message for elderly lifestyles

Final Conclusions

Global packaged food retail volumes should continue to grow

Where now for agricultural commodities and food input prices?

Global grocery retailing outlook: Further consolidation on the cards

Future retail value gains contingent on adding value

Attractive economic i ndicators in emerging m arkets

The East is in the black: Seize the opportunity

Report Definitions

Report terminology (1)

Report terminology (2)

Product category definitions

Retail distribution definitions