what’s the matter with pasta? challenges and opportunities...

WHAT’S THE FUTURE OF PASTA? CHALLENGES AND OPPORTUNITIES IN THE GLOBAL MARKET

JACK SKELLY, FOOD ANALYST

WORLD PASTA DAY AND CONGRESS 2015

© Euromonitor International 2

Euromonitor International: Strategic Global Market Research

WHAT’S THE FUTURE OF PASTA? CHALLENGES AND OPPORTUNITIES IN THE GLOBAL MARKET

http://www.euromonitor.com/

INTRODUCTION

A GLOBAL PICTURE

OPPORTUNITIES WITHIN AND BEYOND

PASTA

CONCLUSION


Global market expansion

Adding value in core markets

Product expansion

Low growth

Difficult competitive environment

Losing out to other staples

Assessing the pasta market depends on your outlook

INTRODUCTION

Opport

unitie

s

Challe

nges


INTRODUCTION

A GLOBAL PICTURE


PASTA

CONCLUSION


$3.7 / capita

25kg / capita

Pasta in a nutshell

A GLOBAL PICTURE

PER CAPITA CONSUMED IN TUNISIA CONSUMPTION OF PASTA GROWTH BETWEEN 2010-2015

6%



Pasta is popular globally

A GLOBAL PICTURE



Global Sales of Pasta by Region 2015

Western Europe

Latin America

North America

Middle East and Africa

Eastern Europe

Asia Pacific

Australasia

Yet it is too reliant on core markets

A GLOBAL PICTURE

64% OF GLOBAL PASTA SALES

GENERATED IN TOP 10

COUNTRIES



…And it’s underperforming in them

A GLOBAL PICTURE

-3,5

-2,5

-1,5

-0,5

0,5

1,5

2,5

3,5

-3.500

-2.500

-1.500

-500

500

1.500

2.500

3.500

Italy US Brazil Germany France Russia UnitedKingdom

Japan Canada Mexico

% C

AG

R 2

010-2

015 &

2015-2

020

Reta

il S

ale

s (

US

$ m

illio

n)

Leading Markets 2010-2020 and their growth (% CAGR)

2010 2015 2020 CAGR 2010-2015 CAGR 2015-2020



Private label driving down value growth in Western Europe

A GLOBAL PICTURE

0

1

2

3

4

5

6

7

8

9

10

0

10

20

30

40

50

60

70

80

Switzerland United Kingdom Germany Italy France

Un

it P

rice

(U

S$ /

kg)

% M

arke

t Sh

are

20

15

Pasta Private Label % Market Share 2015

Private Label % Market Share 2005 Private Label % Market Share 2015 Private Label Unit Price Branded Unit Price



0

5

10

15

20

25

0

50

100

150

200

250

300

350

400

450

500

% C

AG

R 2

01

0-2

01

5

Ret

ail S

ales

(U

S$ m

illio

n)

Sales growth in peripheral markets, 2010-2015

Retail Sales 2015 (US$ million) % CAGR 2010-2015

Qualified optimism for peripheral markets

A GLOBAL PICTURE

5% OF GLOBAL PASTA SALES

GENERATED BY TOP TEN

FASTEST GROWING

COUNTRIES



Pasta consumption heavily split globally

A GLOBAL PICTURE

Retail Consumption of Staples 2015 (kg per capita)



Cultural preference

Lack of affordability

Limited availability

Vicious circle in peripheral markets

A GLOBAL PICTURE


1 minute TO AFFORD 100G PASTA,

RICE AND NOODLES IN

THE US

14 minutes TO AFFORD 100G OF RICE

AND NOODLES IN INDIA

27 minutes TO AFFORD 100G OF

PASTA IN INDIA

Rice - US, 0.8 Mins Pasta - US, 0.8 Mins

Noodles - US, 1.5 Mins

Rice, India, 13.9 mins

Noodles - India, 14.4 Mins

Pasta - India, 27.2 Mins

Time Taken to Purchase

100g of Pasta, Rice &

Noodles – US & India, 2015

Affordability a key

issue for pasta

INTRODUCTION

A GLOBAL PICTURE


PASTA

RECOMMENDATIONS


Premium pasta Health

Opportunities in core markets

OPPORTUNITIES WITHIN AND BEYOND PASTA

Licensing & New Technologies Product expansion



Rude health: healthy and organic pasta performing well


-10

0

10

20

30

40

50

60

70

Gluten-Free Pasta Organic Pasta High Fibre Pasta Pasta

% C

AG

R 2

01

0-2

01

5

% CAGR by product type 2010-2015

Asia Pacific Middle East and Africa Western Europe Latin America Australasia North America Eastern Europe



Consumers willing to pay more for premium and health products


0

1

2

3

4

5

6

7

8

9

10

Ch

ille

d

HW

Dri

ed

Ch

ille

d

HW

Dri

ed

Ch

ille

d

HW

Dri

ed

Ch

illed HW

Dri

ed

Ch

ille

d

HW

Dri

ed

Italy France Germany US United Kingdom

Unit P

rice

pe

r kg (

20

15

)

Unit Price Comparison of Pasta by type



Private label presence weaker in sauces and ready meals


0

20

40

60

80

0 500 1.000 1.500 2.000 2.500 3.000 3.500

Pri

va

te L

ab

el M

ark

et

Sh

are

, 2

01

5

Market Size 2015 (US$ Million)

Italian Ready Meal Presence in Largest Ready Meal Markets 2015

Germany Japan United Kingdom France Canada Russia Italy US

-2

0

2

4

6

-20

0

20

40

60

80

Pasta Pasta Sauces Pasta Pasta Sauces Pasta Pasta Sauces Pasta Pasta Sauces Pasta Pasta Sauces

UK Spain Italy France Germany

% C

AG

R 2

01

0-2

01

5

Mar

ket

Shar

e %

(2

01

5)

Private Label % Market Share of Pasta and Pasta Sauces (2015)

Market Share (%) % CAGR 2010-2015

Note: Bubble Size denotes percentage of ready meal sales from Italian Chilled and Frozen Ready Meals. Sizes range from 0-22.4%



The future of pasta: licensing and new technologies


0

20

40

60

80

100

120

0 1.000 2.000 3.000 4.000 5.000 6.000 7.000 8.000Spend p

er

Household

on

Cookin

g A

pplia

nces 2

014

(US

$)

Spent per Household on Packaged Food 2014 (US$)

Spending per Household on Food and Food Preparation Appliances 2014 (US$)

Norway Israel



0

100

200

300

400

500

600

Sale

s 2

015 (

US

$ m

illio

n)

Rice and Noodles brands in India, 2015 (US$ million)

Note: Orange columns denote noodle brands

Increasing availability in peripheral markets a must


Effort to reduce unit

prices

More widespread distribution

Long-term Strategy

Increased comfort

with pasta


INTRODUCTION

A GLOBAL PICTURE


PASTA

CONCLUSION


Core markets

Developing synergies

Differentiating from private

label

Focus on value growth

Secondary & tertiary markets

Increasing pasta

occasions

Improving availability

Establishing brand

presence

Strategies for success sharply divided globally

CONCLUSION


CONTACT DETAILS Jack Skelly

Food Analyst

Tel: +44 (0) 207 251 8024 EXT 1311

[email protected]

mailto:[email protected]

what’s the matter with pasta? challenges and opportunities...

Documents