Rising price sensitivity as a result of the emergence of the pandemic in Thailand in 2020, which has significantly impacted consumers’ disposable incomes, was supported by a 10% contraction of the country’s GDP during the year. While some consumers initially stockpiled various products including baby food as Thailand entered a lockdown, overall demand heading into 2021 has started to stagnate as consumers are either switching to economy-priced products or preparing their own baby food from scratch.
Baby food is set to remain a highly consolidated competitive landscape in 2021, dominated by Nestlé (Thai) Ltd, Dumex Thailand Co Ltd and Mead Johnson Nutrition (Thailand) Ltd. These players own wide product portfolios across the category, with Nestlé predicted to regain some lost value share within the largest category of growing-up milk formula from leader Dumex, through its brands Bear Brand and Carnation.
In addition to leading international brands, the small domestic company, Xongdur Thai Organic Food Co Ltd, is continuing to be innovative within dried baby food where it offers the Purlife brand. Despite holding low overall value share, the company has been boosting demand by providing attractive price promotions throughout 2020 and into 2021 due to rising price sensitivity, in addition to launching new products.
Baby food is likely to continue to face challenges in Thailand heading into the forecast period, in terms of lingering price sensitivity and a declining birth rate. The government launched a campaign in February 2021 called “Life Balance Smart Family” to encourage couples to start a family, including highlighting access to existing benefits in addition to identifying new ones.
The Milk Code policy which was enforced in Thailand in September 2017 has continued to negatively impact overall demand for milk formula on a long-term basis. Products which are positioned for new born babies are not permitted to be advertised across media platforms which could result in the public believing the product to be suitable for feeding infants.
Despite the range of negative factors which is likely to influence demand for baby food over the early part of the forecast period including lower purchasing power and the Milk Code policy, companies will seek ways to overcome these challenges by implementing promotions instead of advertising, which will ultimately lead to a further decline in the average unit price, and resulting in a weak value growth performance (at constant 2021 prices) compared to volume. This trend will be driven by milk formula, with Hi-Q and Dumex Dugro from Dumex Thailand in addition to DG3, which is a milk formula based on goat milk, continuing to launch discounts through some pharmacies and modern grocery retailers nationwide.
Files are delivered directly into your account soon after payment is received and any tax is certification is verified (where applicable).
Understand the latest market trends and future growth opportunities for the Baby Food industry in Thailand with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
Key trends are clearly and succinctly summarised alongside the most current research data available. Understand and assess competitive threats and plan corporate strategy with our qualitative analysis, insight and confident growth projections.
If you're in the Baby Food industry in Thailand, our research will help you to make informed, intelligent decisions; to recognise and profit from opportunity, or to offer resilience amidst market uncertainty.
This report originates from Passport, our Baby Food research and analysis database.
If you purchase a report that is updated in the next 60 days, we will send you the new edition and data extract FREE! Home Page