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WHAT’S THE FUTURE OF PASTA? CHALLENGES AND OPPORTUNITIES IN THE GLOBAL MARKET
JACK SKELLY, FOOD ANALYST
WORLD PASTA DAY AND CONGRESS 2015
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© Euromonitor International 2
Euromonitor International: Strategic Global Market Research
WHAT’S THE FUTURE OF PASTA? CHALLENGES AND OPPORTUNITIES IN THE GLOBAL MARKET
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INTRODUCTION
A GLOBAL PICTURE
OPPORTUNITIES WITHIN AND BEYOND
PASTA
CONCLUSION
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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
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INTRODUCTION
A GLOBAL PICTURE
OPPORTUNITIES WITHIN AND BEYOND
PASTA
CONCLUSION
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$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%
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Pasta is popular globally
A GLOBAL PICTURE
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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
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…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
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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
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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
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Pasta consumption heavily split globally
A GLOBAL PICTURE
Retail Consumption of Staples 2015 (kg per capita)
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Cultural preference
Lack of affordability
Limited availability
Vicious circle in peripheral markets
A GLOBAL PICTURE
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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
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INTRODUCTION
A GLOBAL PICTURE
OPPORTUNITIES WITHIN AND BEYOND
PASTA
RECOMMENDATIONS
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Premium pasta Health
Opportunities in core markets
OPPORTUNITIES WITHIN AND BEYOND PASTA
Licensing & New Technologies Product expansion
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Rude health: healthy and organic pasta performing well
OPPORTUNITIES WITHIN AND BEYOND PASTA
-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
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Consumers willing to pay more for premium and health products
OPPORTUNITIES WITHIN AND BEYOND PASTA
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
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Private label presence weaker in sauces and ready meals
OPPORTUNITIES WITHIN AND BEYOND PASTA
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%
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The future of pasta: licensing and new technologies
OPPORTUNITIES WITHIN AND BEYOND PASTA
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
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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
OPPORTUNITIES WITHIN AND BEYOND PASTA
Effort to reduce unit
prices
More widespread distribution
Long-term Strategy
Increased comfort
with pasta
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INTRODUCTION
A GLOBAL PICTURE
OPPORTUNITIES WITHIN AND BEYOND
PASTA
CONCLUSION
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© Euromonitor International 23
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
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CONTACT DETAILS Jack Skelly
Food Analyst
Tel: +44 (0) 207 251 8024 EXT 1311