North America Bakery Product Market

Market Overview

The North American bakery product market size witnessed significant growth in the past and is expected to grow at a CAGR of about 5.0 % during the forecast period (2022-2030).

Highlights

• The biscuits dominated the market by product range.
• Online retailing dominates the market by distribution channel.
• The low calories segment dominates the market by form.
• Canada 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.

Market Dynamics

North America Bakery Product Market Drivers

Bread Remains the Strength in the Bakery Industry

Bread holds a significant market share in the bakery products industry in North America. Still, its dominance has faced challenges from other bakery items like pastries and, particularly, doughnuts, which have experienced rapid growth recently and are expected to continue expanding. The growth in the bread segment is primarily driven by the rising demand for bread varieties that are whole grain, high in fiber, gluten-free, or considered healthy and fortified. These types of bread products have gained popularity among consumers who are embracing a healthier lifestyle. In developed countries, competition in the bread market is uneven due to product variety and numerous informal channels involved in bread production.

Rising Trend of Healthy Living, Natural Nutrition, and Organic Products

In North America, the increasing popularity of natural nutrition, healthy lifestyles, and organic products has significantly driven the demand for whole wheat, light, natural, and additive-free food items. The recent surge in sales of packaged products such as whole wheat, whole meal, gluten-free, and natural products reflects the growing preference for healthier choices. Bakery products have long been essential in human nutrition, offering convenience, accessibility, and nutritional value, which are key factors for their continued presence in the modern market. These products hold great importance in the middle- to lower-income countries’ diets. Bread has been a staple food in various local cuisines worldwide and has demonstrated impressive growth even during periods of global economic downturn.

North America Bakery Product Market Restraints

High Entry Barriers Owing to Brand Loyalty and Huge Capital Investments

The bakery industry faces significant competition due to strong brand loyalty and the need for substantial capital investments, resulting in high barriers to entry. To achieve optimal business growth, major companies employ various strategies such as joint ventures, mergers and acquisitions, strategic partnerships with regional manufacturers, and diversification of distribution channels.

North America Bakery Product Market Opportunities

Growing Confectionery Market in the U.S.

The confectionery market in the US is expected to benefit from the positive outlook for the overall confectionery industry. The increasing demand for convenient snacks is driving the growth of confectionery products in the country. The market is fueled by product innovation, including the development of low-fat, low-calorie, sugar-free chocolates and non-chocolate confections. Promotional activities and social media marketing are also contributing to market growth. The introduction of small-sized packs and the exploration of new formulations and textures are influencing consumer preferences and sales.

According to internal research, the confectionery market in the US is projected to grow at a compound annual growth rate (CAGR) of 4.3% between 2017 and 2022, reaching a value of USD 46.4 billion. The volume of confectionery consumption is expected to increase from 2,844.9 million kg in 2017 to 3,164.6 million kg by 2022, with a CAGR of 2.2%. Furthermore, per capita consumption of confectionery in the US is predicted to rise from 8.7 kg in 2017 to 9.3 kg by 2022. Chocolate is currently the largest category in the market, generating sales of USD 21.2 billion in 2017, followed by sugar confectionery (USD 13.1 billion) and gum (USD 3.4 billion).

Segmental Analysis

The North America bakery product market is segmented into product range, distribution channel, and form.

It is further segmented by product range into cakes, pastries, bread and rolls, cookies, biscuits, pretzels, tortillas, and others.

Biscuits dominated the market by product range and are expected to register a CAGR of 6.4% 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 7.6% over the forecast period.

The cake market is further segmented into cupcakes, dessert cakes, and sponge cakes. Dessert cakes dominate the market and are expected to register a CAGR of 3.2% over the forecast period.

The pastries market type is further segmented into shortcrust pastry, filo pastry, and puff pastry. The puff pastry dominates the market and is expected to register a CAGR of 6.1% over the forecast period.

The bread and rolls market type is further segmented into baguettes, loaves, rolls, burger buns, ciabattas, sandwich slices, frozen bread, and others. The rolls dominate the market and are expected to register a CAGR of 6.4% 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 7.3% 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 6.0% 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 6.0% over the forecast period.

Regional Analysis

The North American bakery product market is segmented by country: The U.S. and Canada. Canada dominated the market with a CAGR of 5.4% during the forecast period.

The bakery product market in North America can be examined on a regional basis, where the United States takes the lead regarding market size and extensive consumption of bakery goods. Canada, although smaller, holds a significant market share with a focus on convenience and health-consciousness. Mexico shows rapid growth driven by its strong dependence on traditional bakery items. Consumer preferences and cultural influences vary across regions, influencing the North American bakery product market dynamics.

The U.S.

The United States holds the largest North American bakery product market share. It has a strong bakery culture and widespread consumption of bread, cakes, pastries, and other baked goods. Convenience and on-the-go options are particularly popular in the U.S. market. Health consciousness and indulgence trends influence product innovation, focusing on whole grains, high fiber, and other health-promoting ingredients. The demand for gluten-free varieties is also rising, albeit at a higher price point. Portable, single-serve packaging is gaining popularity among consumers. However, the consumption of morning baked goods has declined as consumers seek healthier breakfast alternatives.

Canada

The bakery product market in Canada is also significant, although it is relatively smaller than in the U.S. Canadian consumers have similar preferences for convenience and indulgence, driving the demand for various bakery products. Health consciousness is also influencing the market, leading to the introduction of healthier options. The gluten-free trend is also prevalent in Canada, with consumers seeking gluten-free baked goods. Local bakeries and artisanal products are valued in the Canadian market.

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.
• September 2021- Finsbury Food Group expanded its Mary Berry supermarket cake range with the launch of Bundt cakes. The Bundt cakes come in two flavors, lemon sponge cake with lemon icing, lemon curd drizzle, and hand-decorated Belgian with chocolate curls, and chocolate sponge cake featuring chocolate icing and hand-decorated Belgian dark and white chocolate.