Latin America Bakery Product Market

Market Overview

The Latin America bakery product market witnessed significant growth in the past and is expected to grow at a CAGR of 5.4% during the forecast period (2022-2030).

Highlights

• Biscuits dominated the market by product range.
• Online retailing dominates the market by distribution channel.
• The low calories segment dominates the market by form.
• Brazil dominates the market by region. 

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.

The bakery market in Brazil stands out in Latin America due to the country's significant consumption of bakery goods. Brazilian consumers are also expanding their search for packaged bread made with healthier ingredients in Argentina, Chile, and Colombia. The snacking trend impacts the consumption of biscuits by both adults and children.

Market Dynamics

Latin America Bakery Product Market Drivers

Bread Remains the Strength in the Bakery Industry

In Latin America, bread remains significant in the bakery products industry, although it faces strong competition from fast-growing items like pastries and doughnuts. This competition is expected to drive further growth in these alternative categories. The bread segment is expanding, driven by 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 healthier bread options have gained popularity among consumers adopting a healthier lifestyle. However, the competitive landscape in the bread market varies among developed countries due to the wide range of product options available and the involvement of numerous informal channels in bread production.

Latin America Bakery Product Market Restraints

High Entry Barriers Owing to Brand Loyalty and Huge Capital Investments

Intense competition in the bakery industry arises from customers' loyal attachment to specific brands and the substantial financial investments necessary, which act as barriers to entry. Major companies employ diverse tactics such as forging partnerships, pursuing mergers and acquisitions, establishing strategic alliances with local manufacturers, and expanding their distribution networks to achieve maximum business growth.

Latin America Bakery Product Market Opportunities

Growing Confectionary Market

The confectionery market in the United States is poised to experience favorable growth, aligning with the positive prospects of the overall confectionery industry. The growing preference for convenient snacks is a key driver of the expansion of the confectionery products market in the country. Market growth is fueled by product innovation, including introducing low-fat, low-calorie, and sugar-free options in chocolates and non-chocolate confections. Promotional activities and the influence of social media marketing also contribute to the market’s upward trajectory.

Segmental Analysis

The Latin America 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 dominated the market and are expected to register a CAGR of 6.9% over the forecast period.

The biscuits market type is further segmented into rolled, drop biscuits, scones, shortcakes, and others. The drop biscuits dominate the market and are expected to register a CAGR of 8.1% over the forecast period.

The cake market type is further segmented into cupcakes, dessert cakes, and sponge cakes. Dessert cakes dominate the market and are expected to register a CAGR of 3.6% over the forecast period.

The pastries market type is further segmented into shortcrust pastry, filo pastry, puff pastry, and others. The puff pastry dominates the market and is expected to register a CAGR of 6.5% over the forecast period.

The bread and rolls market type is further segmented into baguettes, loaves, rolls, burger buns, ciabattas, sandwich slices, frozen bread, etc. The rolls dominate the market and are expected to register a CAGR of 6.8% 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 dominate the market and are expected to register a CAGR of 7.8% over the forecast period.

The distribution channel is further segmented into convenience stores, specialty stores, hypermarkets and supermarkets, online retailing, and others.

Online retailing dominates the market and is expected to register a CAGR of 6.5% over the forecast period.

It is further segmented by form into organic, gluten-free, sugar-free, low-calorie, and others.

The low calories dominate the market and are expected to register a CAGR of 6.8% over the forecast period.

Regional Analysis

The bakery product market is segmented by country: Mexico, Brazil, Rest of Latin America.  Brazil dominated the market with a CAGR of 6.6% during the forecast period.

A regional analysis of the bakery product market in Latin America reveals Brazil's dominance due to its high consumption of bakery goods. Brazilian buyers actively seek healthier options in packaged bread from countries like Argentina, Chile, and Colombia. Furthermore, the snacking trend has influenced the consumption of biscuits among adults and children in the region.

Recent Developments

• April 2022- Walker’s Shortbread partnered with retailer Dufry to launch a new Global Travel Retailer range at more than 55 travel sites worldwide. The product range will include several types of shortbread and other products in it.
• January 2021- Chipita SA, a global baker of packaged cakes and pastries, was acquired by Mondelez International Inc. Croissants bagel chips, cake bars, biscuits, and spreads were among the company’s products, which were largely offered under the 7Days, Chipicao, and Fineti names. Mondelez plans to use Chipita’s Central and Eastern European distribution network to expand its regional distribution while introducing its brands to new nations in the region and beyond.