Market Overview
The Asia Pacific bakery product market witnessed significant growth in the past and is expected to grow at a CAGR of 6.5% during the forecast period (2022-2030).
Bakery products have gained immense importance in both formal and informal occasions. They are made from grains and cooked using dry heat in an oven or hot ashes, encompassing bread, rolls, pies, cereals, and cakes. Baking has a long history, dating back thousands of years, and the demand for these products has consistently grown over time. Initially, bakers would create baked goods at home and sell them on the streets. This eventually led to dedicated bakeries providing their goods to households and commercial establishments.
In the coming years, the Asia-Pacific region is expected to witness substantial growth in its market, driven by the increasing adoption of Western diets in countries such as China, India, and Southeast Asian nations. Factors like population growth, higher female employment rates, and rising disposable income contribute to the market's development. The growing health-conscious trend in China and Japan further boosts the demand for low-carb and reduced-sugar bread, cakes, and pastries.
Market Dynamics
Asia Pacific Bakery Product Market Drivers
Bread Remains the Strength in the Bakery Industry
In Asia-Pacific, while bread continues to hold a prominent position in the bakery products industry of the Asia-Pacific region, it faces stiff competition from rapidly growing items like pastries and doughnuts. This competition is expected to persist and drive further growth in these alternative categories. The bread segment is experiencing growth primarily due to the increasing demand for bread variants that cater to specific dietary preferences, such as whole grain, high fiber, gluten-free, and those considered healthy and fortified. These types of bread products have gained popularity among consumers who are embracing a healthier lifestyle. However, the competitive landscape in the bread market varies across developed countries due to the wide array of product options available and the involvement of numerous informal channels in bread production.
Rising Trend of Healthy Living, Natural Nutrition, and Organic Products
In Asia-Pacific, the growing demand for natural nutrition, healthy lifestyles, and organic products has significantly impacted the market for food items that prioritize characteristics like whole wheat, lightness, natural ingredients, and freedom from additives. The increased sales of packaged products, including options such as whole wheat, whole meal, gluten-free, and natural alternatives, indicate a rising preference for healthier food choices. Bakery products have historically played a crucial role in human nutrition, offering convenience, availability, and nutritional value, which are key factors contributing to their continued presence in today's market. These products hold significant importance in the diets of countries with middle to lower-income groups. Despite global economic downturns, bread, a staple food in many local cuisines worldwide, has demonstrated impressive growth, showcasing its resilience in the face of challenging times.
Asia Pacific Bakery Product Market Restraints
High Entry Barriers Owing to Brand Loyalty and Huge Capital Investments
The bakery industry faces significant competition due to customers' strong loyalty towards specific brands and the substantial financial investments required, creating significant barriers to entry. To achieve optimal business growth, major companies adopt various strategies such as forming partnerships, engaging in mergers and acquisitions, establishing strategic alliances with local manufacturers, and expanding their distribution networks.
Asia Pacific Bakery Product Market Opportunities
Growing Confectionary Market
The confectionery market in the United States is expected to benefit from the positive outlook of the overall confectionery industry. The increasing demand for convenient snacks is driving the expansion of the confectionery products market in the country. Market growth is fueled by product innovation, such as introducing low-fat, low-calorie, sugar-free chocolates and non-chocolate confections. Promotional activities and social media marketing also plays a role in driving this upward trend.
Regional Analysis
The Asia-Pacific bakery product market is segmented by country: China, Japan, India, South Korea, Southeast Asia, Rest of Asia-Pacific. India dominated the market with a CAGR of 7.9% during the forecast period.
A regional analysis of the bakery product market in the Asia-Pacific reveals significant trends and patterns. The market in this region is experiencing notable growth, driven by factors such as the rising popularity of Western diets, population expansion, increasing employment rates for women, and growing disposable income. China's bakery sector is witnessing rapid development, while the Indian market is seeing the emergence of bakery café chains and a diverse range of bakery products. The demand for healthier options and the influence of Western innovations are also shaping the market in this region.
China's bakery sector has experienced rapid expansion due to changing dietary and lifestyle preferences. Increasing disposable income and introducing new varieties have bridged the gap between consumers and businesses. The presence of bakeries in retail, e-commerce, hypermarkets, supermarkets, and other platforms has replaced traditional bread items with Western innovations.
Likewise, the Indian bakery ingredient market is witnessing significant growth. While several large- and small-scale organized operations produce bread and biscuits, most bakery products in India are made by unorganized small family units. However, the market is diversifying beyond bread, cake, and biscuits with the emergence of additional bakery products. Competition has intensified with the initiatives of a few enterprises like Britannia, Bisk Farm, and Morish, while bakery café chains such as Barista, Café Coffee, and Monginis are also gaining popularity. The younger generation's preference for independent bakeries has increased demand for snacks, muffins, puff pastries, and savory dishes.
Segmental Analysis
The Asia-Pacific bakery product market is segmented into product range, type, distribution channel, and form.
It is further segmented by product range into cakes, pastries, bread and rolls, cookies, biscuits, pretzels, tortillas, and others.
The biscuits hold the major share of the market and are expected to register a CAGR of 8.0% over the forecast period. The biscuit sector is one of the fastest-growing markets for fast-moving consumer goods (FMCG). Sweet biscuits are the most popular and fastest-growing segment of the worldwide biscuit market. As more people buy sweet biscuits and other varieties of biscuits, sweet biscuits are expected to dominate the global market. The cookies (sweet biscuits) market consists of the retail sales of assortment cookies, butter cookies, chocolate cookies, cream-filled cookies, plain cookies, wafer cookies, artisanal cookies, in-store bakery cookies, and egg cookies.
The biscuit market type is further segmented into rolled, drop biscuits, scones, shortcakes, and others.
The drop biscuits hold the major share of the market and are expected to register a CAGR of 9.1% over the forecast period.
The cake market type is further segmented into cupcakes, dessert cakes, and sponge cakes.
Dessert cakes hold the major share of the market and are expected to register a CAGR of 4.5% over the forecast period. Dessert cakes are expected to keep up their lead over the anticipated period because they are commonly consumed fresh on various occasions. In many countries, it is also consumed as part of the dessert after meals. The product category that is expected to grow the fastest is sponge cakes. This is a result of their expanding appeal to young people worldwide. These sponge cakes have a lengthy shelf life in comparison to other desserts. These goods can be enjoyed both when they are still fresh and after a week. As a result, Young people worldwide are boosting the demand for these products.
The pastries market type is further segmented into short crust, filo, and puff pastry.
The puff pastry holds the major share of the market and is expected to register a CAGR of 7.6% over the forecast period. During the anticipated term, rising product consumption at various events and festivals would generally support the market for Patisserie baking products. The final product is often made from fresh or frozen dough and eaten as a sweet dessert.
The bread and rolls market type is further segmented into baguettes, loaves, rolls, burger buns, ciabattas, sandwich slices, frozen bread, and others.
The rolls hold the major share of the market and are expected to register a CAGR of 7.9% over the forecast period.
By cookies market type, it is further segmented into molded cookies, drop cookies, bar cookies, rolled, refrigerator (icebox), sandwich cookies, and others.
Bar cookies hold the major share of the market and are expected to register a CAGR of 8.8% over the forecast period. It is described as a flat, baked sweet dessert produced using oil or fat, flour, raisins, chocolate chips, oats, nuts, and other ingredients to enhance flavor and act as garnish. Sugar or sugar-free sweeteners may be used as desired. There are various types of biscuits, such as sandwiches and chocolate-filled biscuits. Both grocery stores and convenience stores and bakeries provide freshly baked cookies. The population's increasing demand for products created in bakeries is the primary factor driving the market's growth. The primary forces behind market increase also include changing lifestyles and work patterns, the availability of nutritious, gluten-free, digestible cookies, etc. The improving economy and increased disposable income further drive the market's rise.
The distribution channel is further segmented into convenience stores, specialty stores, hypermarkets and supermarkets, online retailing, and others.
Online retailing holds the major share of the market and is expected to register a CAGR of 7.5% over the forecast period. Due to the widespread use of smartphones and the internet, online sales channels will experience rapid growth during the forecasted period. Local small businesses frequently competed against major brands and internet start-ups in the Bake-Off Bakery industry, particularly those creative and quick-moving firms. Businesses that operate in physical locations have a problem due to the explosive rise of online retailing over the past ten years. While online retailing keeps expanding, physical shops are having trouble. If bakeries could benefit from e-commerce, this shifting shopping tendency could represent a chance for the industry.
By form, it is further segmented into organic, gluten-free, sugar-free, low-calorie, and other.
The low calories hold the major share of the market and are expected to register a CAGR of 7.5% over the forecast period. The demand for low-calorie bakery goods has experienced a noticeable increase in size and valuation over the last few years. Additionally, the millennial age has made high-fiber, multigrain bakery items the trendiest because they focus on health and fitness and are responsible for expanding low-calorie bakery products. Additionally, the demand for low-calorie cake is rising due to the increased knowledge of calorie-free products that satisfy cake desires without increasing calorie consumption, propelling the global market for low-calorie bakery products to develop significantly.
