Japan at “bottom of the ladder” in terms of bakery sales growth, analyst

By Helen Glaberson

- Last updated on GMT

Related tags: Cereal, Japan, Bread

The Japanese bakery and cereals market is expected to slow down over the next few years in terms of retail sales and product launches, said Datamonitor, as Japan’s biggest bread maker Yamazaki reported stagnant 2010 net sales.

Datamonitor analyst Varun Kumar told BakeryandSnacks.com that, globally, Japan is “at the bottom of the ladder”​ in terms of bakery sales growth with an estimated CAGR of only 1 per cent for the next five years, whereas countries such as India and China rank highest with 11 per cent and 10 per cent estimated CAGR over the next five years.

In its recently published 2010 financial results, Yamazaki posted 615bn yen (approximately €5.4bn) in net sales for its non consolidated division, with bakery products comprising over 50 per cent of this.

This was a very slight decrease from its reported 615,3bn yen sales in 2009, when the company had a 23 per cent share of the Japanese bakery market.

In terms of new products launched, the Japanese bakery and cereals market has also seen a drop in its global ranking from the seventh place it occupied in 2009 to tenth place in 2010, said Datamonitor.

Meanwhile, despite the overall decline, the growth of functional bakery and cereals market has been “very optimistic”​ in the region said the market specialists. This was reflected in the rise in contribution of new functional bakery and cereal products by 10 per cent in 2010, as opposed to just 7 per cent in 2009.

Slight volume growth

According to a report from market research group, Euromonitor, packaged/industrial bread saw the fastest volume growth in the Japanese bakery and cereals sector in 2010 - at 2 per cent. This was followed by packaged/industrial pastries, which saw volume sales increasing by 1 per cent.

Unpackaged/artisanal bread and pastries saw volume declines of 3 per cent and 1 per cent, respectively.

“White bread continues to be the most popular choice among consumers. The main reason is its being affordable, considering the unstable economy and conservative spending patterns of consumers. It is also the most flexible type of bread, as it can be consumed in various ways,”​ added Euromonitor.

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