Despite some stockpiling immediately following the beginning of the COVID-19 pandemic in 2020, sugar confectionery has only recorded sluggish growth over the last few years and this trend is expected to continue in 2021 with an even lower growth rate expected in 2021 than 2020. Although some snacks categories were stimulated by the trend for comfort eating during the COVID-19 pandemic, sugar confectionery was not one of these, with the category only registering conservative growth in both 2020 and 2021.
In 2021, flavour innovation is expected to remain the category’s main growth driver as companies continue to use new flavour launches to pique consumer interest in their products. Sour flavours in particular are gaining popularity in Australia with recent launches including a new berry flavoured variant of Sour Patch Kids, and Allen’s has launched a new sour version of Frogs Alive.
As sugar confectionery growth remains conservative, more brand partnerships are observed in the market. For instance, Tic Tac partnered with Coca-Cola on a limited edition, which was available from December 2019 to February 2020.
Over the forecast period price, is expected to remain an important factor in consumer decision making, especially as the financial and economic impact of the COVID-19 pandemic is expected to outlast the epidemiological threat of the COVID-19 virus itself in Australia. That being said, there is also a considerable opportunity for growth in the premiumisation trend, whereby companies will be able to reap the benefits of added value benefits such as product innovation and unique flavour variants as consumers will be willing to pay more to enjoy the sense of nostalgia evoked by sugar confectionery and to regain a sense of normality in the coming years.
Mondelez Australia Pty Ltd is going green after making the complete switch to renewable electricity supplies for two of its factories in Melbourne. The company, which is working towards reducing carbon emissions whilst maintaining a wide array of sugar confectionery products, is leading the way in terms of eco-friendly production processes and other companies are expected to follow them over the forecast period.
Considering Australia’s rising number of obesity cases, a sugar tax is increasingly well supported by young Australians. The Australian Beverages Council declared that its members would cut their use of sugar by 20% by 2025, but a sugar tax is yet to be implemented by the government.
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Understand the latest market trends and future growth opportunities for the Sugar Confectionery industry in Australia with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
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This report originates from Passport, our Sugar Confectionery research and analysis database.
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