Fortified/Functional Packaged Food in Australia

PROSPECTS

Solid performance for FF baby food supported by new launches with further development expected

Fortified/functional packaged food experienced a mixed performance amongst the major categories in 2019, resulting in low but positive demand overall. FF baby food was one of the strongest performers in both retail volume and current value terms, driven by the innovation offered by FF milk formula.

Fortified snacking combines convenience with nutritional requirements

FF sweet biscuits, snack bars and fruit snacks was another strong performer in 2019, driven by demand for healthy snacks with FF protein/energy bars able to address the convenience trend combined with nutritional requirements. Functional snacks are a particularly encouraging environment for innovation as the line between snacking and meals continues to blur, with flavour comprising an important element of a product’s success.

Boost to demand for FF breakfast cereals as intensified competition leads to reduction in average unit price

FF breakfast cereals was the strongest performer overall in retail volume terms in 2019, as the category continued to move in the direction of health and wellness. The category was given a significant boost towards the end of the review period with the entry of an increasing number of smaller brands which continued to gain strong value share.

COMPETITIVE LANDSCAPE

Increasing fragmentation with close competition amongst leading players

Fortified/functional is an increasingly fragmented competitive landscape due to the further entry of new players in niche areas of the category, and the slim leadership of Lion Pty Ltd, which was closely followed by Parmalat Australia Pty Ltd and Nutricia Australia Pty Ltd. The category also has a healthy presence of private label retailers such as Aldi Stores Supermarkets Pty Ltd.

Probiotics continues to gain in popularity amongst new launches

In line with the trend to fortify various products with probiotics, particularly evident in FF yoghurt in line with snacking, convenience and supporting digestive health, players are looking to expand their portfolios in other more unlikely areas. This was the case for Australian breakfast cereal brand Sunsol, which launched its Sunsol PRO-biotic toasted muesli range in two flavour variants of Almond & Manuka Honey, and Almond, Cashew & Chia, which are fortified with probiotics, fibre and protein.

Ongoing decline for FF bread as consumers look to alternative types or new breakfast options

Although local consumers have increasingly moved away from white bread which is perceived to be unhealthy, demand for FF bread continued to decline in 2019, as Australians either moved towards naturally healthy (high fibre) and organic variants, or reduced their overall bread consumption, preferring to choose perceived healthier options for breakfast such as FF breakfast cereals or even yoghurt and fresh fruit. This category is therefore likely remain fairly consolidated with George Weston Foods retaining its convincing leadership with brands Bürgen and Tip Top, followed by Goodman Fielder Ltd with Wonder White, with the category unlikely to be attract the strong entry of new players as witnessed in other more dynamic categories.

Files are delivered directly into your account within a few minutes of purchase.