Fortified/Functional Packaged Food in Argentina

PROSPECTS

Development of category due to Affordable Prices programme

In the first years of the review period, companies carried out a large number of launches of fortified/functional packaged food in basic products such as milk and yoghurt, although it should be noted that these new products were not the result of consumers’ higher awareness of their benefits. The development was due to the “Precios Cuidados" programme (Affordable Prices), created by the previous government.

Strong contraction of consumption due to lack of interest in FF Milk

In 2018, sales of fortified/functional packaged food recorded a significant contraction in retail volume terms. This poor performance was partly due to the complicated economic context and the need for consumers to seek economic alternatives to maximise their salaries.

FF pasta is a positive note and escapes economic crisis

FF pasta was one of the few categories within fortified/functional packaged food to register expansion in retail volume terms in 2018. Although consumers were only gradually gaining an interest in FF pasta at the end of the review period, it was key in its development with a high number of launches during 2017 and 2018, with many of them accompanied by strong investments in advertising campaigns.

COMPETITIVE LANDSCAPE

Dairy companies dominate fortified/functional packaged food

In 2018, Mastellone Hnos SA retained its lead of fortified/functional packaged food due to the leadership of FF milk, the most important category in the category in Argentina. The company offers the brand La Serenísima, although its affordable brand La Armonía gained prominence over the review period as a result of the unstable economy.

Strong fall of SanCor's participation

SanCor Cooperativas Unidas Ltda registered a sharp drop in value share in 2017 due to the deep financial crisis experienced by the company, which severely affected its production and sales of FF milk. In addition, in order to pay its debts, the company sold its line of yoghurt and chilled dairy desserts to Alimentos Refrigerados SA in mid-2016.

Favourable but still complicated horizon

Over the forecast period, fortified/functional packaged is predicted to make a recovery in retail volume terms. However, this recovery will be slow and its performance has a strong correlation with the expected improvement of real salaries.

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