Executive Summary

Aug 2018
Prospects
Rise in demand for quality products drives cheese sales

As a result of better living conditions and rising wages, demand has been growing for higher quality and more expensive special cheese products in Hungary, thus supporting value growth. Consumers are ready to try products that they could not previously afford, seeking a more gourmet experience.

Popularity of grilling has positive impact on sales

Cheese has also been benefitting from the growing popularity of grilling among Hungarians, boosting sales of cheese products such as mozzarella and other grilled cheeses offered by Szarvasi Mozzarella and Korostej under its Hajdú brand. These products are used not only for grilling, but also as ingredients for salads in line with the latest health trends.

Health trend boosts demand for lactose free cheese

Although cheese is mature, offering a wide selection of products and a large number of players, producers are finding several ways to maintain consumer interest. One good example is sales of free from lactose cheese products in response to the latest health trends and needs of consumers.

Competitive Landscape
Tolnatej and Pannontej invest strongly in innovation and advertising

Tolnatej remains a key cheese producer in Hungary due to its focus on consumer needs and launch of new free from lactose variants, both in hard and soft cheese. In addition, the company also invests in promotions, including a TV spot for Tolle.

Rising demand for private label ranges

The share of private label cheese products has been growing thanks to widening product portfolios and cooperation with local dairy firms. Besides traditional cheese products offered by chains like Aldi, Tesco, Lidl and Spar, the availability of lactose free variants has also been expanding, including Lidl’s Bluedino brand and Aldi’s Milfina brand.

Customer loyalty and revamped stores boosting discounter sales

Although Hungarians are becoming less price-sensitive due to improving economic conditions, private label cheese products are still popular as they are trusted by consumers. The fact that chains are selling private label products, revamping stores and opening new units is also boosting sales.

Prospects
Demand for cheap imported drinking milk products could drop further

Volume sales of imported UHT milk products are projected to significantly decline since the Hungarian government intends to reduce VAT on ESL and UHT milk products to 5% by 2019. Cheap products, mainly imported from Poland and Slovakia, have been losing share since Hungarians can now afford higher quality products due to rising disposable incomes.

Cow’s milk growth limited by rising health awareness and lifestyle trends

Although cow’s milk remains the largest drinking milk products area and continues to post value growth, volume sales in the area are falling due to the increasing popularity of plant-based products and rising health awareness. On the other hand, changing lifestyle trends, with a growing number of consumers being too busy to have breakfast at home, have also led to a drop in milk consumption.

Strong other milk alternatives growth attracts Coca-Cola

Other milk alternatives saw strong volume growth in 2018, mainly as a result of rising health concerns. Products in this area are increasingly being consumed not only by people affected by allergies or intolerances, but also by those who consider animal-based products unhealthy – an attitude that is spreading with the help of the internet and social media.

Competitive Landscape
Alföldi Tej strengthens position due to growing availability of local products

Alföldi Tej continues to lead sales within drinking milk products due to the popularity of its Alföldi, Magyar Tej and Riska milk brands, which are available in most types of store and are gaining shelf space as a result of a drop in the availability of cheap imported milk products. The company sells both fresh and shelf stable products, as well as free from lactose milk under its Riska brand.

Private label products remain popular due to special positioning

Unlike in most packaged food areas, there is significant cooperation between chains selling private label products and local producers in Hungary. This is because several locally owned players, such as Alföldi Tej, Abaújtej and Félegyházi Tej, produce private label drinking milk products for chains.

Cooperation between producers and retail chains

This cooperation is favourable both for producers, which face less competition from imported products, as well as chains, which gain trust from consumers. Recently, Aldi purchased the rights for the Kokárdás brand from Alföldi Tej.

Prospects
Yoghurt growth fuelled by demand for convenience, indulgence and healthy features

Combining indulgence and healthy features, yoghurt value and volume sales continued to grow in 2018, benefitting from new product launches such as Danone’s Activia yoghurt with added breakfast cereal. Drinking yoghurt posted the strongest value growth thanks to TV adverts, primarily for Danone’s Actimel brand, which also introduced a new variant.

Plant-based products benefit from health and lifestyle trends

Free from dairy yoghurt products are among the most dynamic areas and are expected to perform well over the forecast period. Future expansion is likely to be driven by current trends, with more and more consumers, especially younger people, opting for plant-based alternatives due to intolerance issues and other health concerns.

Sour milk products growth limited by increasing maturity

Sales within sour milk products are expected to remain relatively stable over the forecast period. Future expansion will be hindered by increasing maturity and lack of new product launches and innovations.

Competitive Landscape
Danone continues to lead sales

Danone remains the leading player within yoghurt and sour milk products thanks to its offering of well-known brands such as Danone, Oikos and Actimel. At the same time, the firm has seen a drop in value share.

Meggle, Lactalis, Spar and FrieslandCampina see potential in local yoghurt

Several companies, including those not previously present in the area, see potential for local yoghurt. For example, Meggle has entered the area by introducing Meggle Active Protein yoghurt with high protein content, targeting health-conscious consumers.

Private label less dominant than in other areas but gaining share

Although the presence of private label ranges in yoghurt is lower than in other packaged food areas, such products continue to gain sales share, with popular ranges including those offered by Lidl, Spar and Tesco. Lidl has been expanding its product portfolio by offering flavoured yoghurt products under its Pilos brand and benefitting from premiumisation trends via its Deluxe brand, which are available occasionally in Lidl stores.

Prospects
Chilled snacks and desserts offering healthy indulgence

Chilled snacks and desserts were among the areas to post the biggest volume sales increase within other dairy as producers have been highlighting the healthy properties of their products. Products containing rice or other grains are among the most popular as they can also be consumed as a meal or for breakfast.

Cream sales driven by rising prices

Since cream is by far the largest other dairy area, its performance has a major impact on overall sales. Sour cream is a traditional product in Hungary that is primarily used for cooking and baking purposes, with performance being influenced by changing lifestyle trends.

Rising health concerns impact demand for shelf stable dairy desserts

Shelf stable dairy desserts volume sales are expected to continue to decline over the forecast period. On the one hand, Hungarians are buying less shelf stable products as they are considered to be unhealthy and to contain additives.

Competitive Landscape
FrieslandCampina continues to lead sales

FrieslandCampina remains the largest player within other dairy in Hungary. The company sells several brands, such as Landliebe, Oké!, Milli and Pöttyös, covering most areas.

Private label sales stronger within fromage frais and quark

The sales share of private label products is highest in fromage frais and quark due to their offering of good value for money and strong trust among local consumers. At the same time, when it comes to indulgence, local players often opt for branded products, thus leading to lower private label sales share in chilled snacks and shelf stable and chilled desserts.

Position of locally owned firms remains strong in other dairy

Despite the presence of international businesses in packaged food in Hungary, locally owned firms remain strongly positioned in other dairy in Hungary. Leading Hungarian companies include Sole-Mizo, Alföldi Tej, Tolnatej and Naszálytej.

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Overview

Discover the latest market trends and uncover sources of future market growth for the Dairy industry in Hungary with research from Euromonitor's team of in-country analysts.

Find hidden opportunities in the most current research data available, understand competitive threats with our detailed market analysis, and plan your corporate strategy with our expert qualitative analysis and growth projections.

If you're in the Dairy industry in Hungary, our research will save you time and money while empowering you to make informed, profitable decisions.

The Dairy in Hungary market research report includes:

  • Analysis of key supply-side and demand trends
  • Detailed segmentation of international and local products
  • Historic volumes and values, company and brand market shares
  • Five year forecasts of market trends and market growth  
  • Robust and transparent market research methodology, conducted in-country

Our market research reports answer questions such as:

  • What is the market size of Dairy in Hungary?
  • What are the major brands in Hungary?
  • How has the economic downturn impacted sales performance given its staple food status?
  • Given mounting obesity concerns, are consumers moving from full-fat to reduced fat/fat-free offerings?
  • How are volatile farmgate prices for milk impacting retail prices and sales performance?

Why buy this report?

  • Gain competitive intelligence about market leaders
  • Track key industry trends, opportunities and threats
  • Inform your marketing, brand, strategy and market development, sales and supply functions

This industry report originates from Passport, our Packaged Food market research database.

Butter and Spreads

Cheese

Drinking Milk Products

Other Dairy

Yoghurt and Sour Milk Products

Packaged Food in Hungary - Industry Overview

EXECUTIVE SUMMARY

Consumer willingness to spend more and innovation boost packaged food
Consumers more conscious of quality and ingredients
Competition remains intense, with domestic players enjoying support from the government
Distribution channels focus on improving consumer loyalty and environmental issues
Growth of packaged food sales likely to slow over the forecast period

FOODSERVICE

Sales to Foodservice
Sales to foodservice supported by growth in the number of foodservice outlets
Healthy edible oils perform well
Bulk food products hamper packaged food sales to foodservice
Consumer Foodservice
Number of foodservice outlets expands in 2018 for the first time in the review period
Foodservice outlets continue to record value growth
McDonald’s focuses on health and wellness trends, whilst expanding the number of employees to remain leader
Category Data
Table 1 Foodservice Sales of Packaged Food by Category: Volume 2013-2018
Table 2 Foodservice Sales of Packaged Food by Category: % Volume Growth 2013-2018
Table 3 Forecast Foodservice Sales of Packaged Food by Category: Volume 2018-2023
Table 4 Forecast Foodservice Sales of Packaged Food by Category: % Volume Growth 2018-2023

MARKET DATA

Table 5 Sales of Packaged Food by Category: Volume 2013-2018
Table 6 Sales of Packaged Food by Category: Value 2013-2018
Table 7 Sales of Packaged Food by Category: % Volume Growth 2013-2018
Table 8 Sales of Packaged Food by Category: % Value Growth 2013-2018
Table 9 GBO Company Shares of Packaged Food: % Value 2014-2018
Table 10 NBO Company Shares of Packaged Food: % Value 2014-2018
Table 11 LBN Brand Shares of Packaged Food: % Value 2015-2018
Table 12 Penetration of Private Label by Category: % Value 2013-2018
Table 13 Distribution of Packaged Food by Format: % Value 2013-2018
Table 14 Distribution of Packaged Food by Format and Category: % Value 2018
Table 15 Forecast Sales of Packaged Food by Category: Volume 2018-2023
Table 16 Forecast Sales of Packaged Food by Category: Value 2018-2023
Table 17 Forecast Sales of Packaged Food by Category: % Volume Growth 2018-2023
Table 18 Forecast Sales of Packaged Food by Category: % Value Growth 2018-2023

SOURCES

Summary 1 Research Sources