Confectionery Market: High Turnovers and High Competition
By Messe Düsseldorf GmbH
Most people enjoy a sweet tooth, but with the trend towards more sustainability, there is also an increase in demand for sweets with more eco-friendly packaging. This puts severe pressure on the confectionery industry to adopt packaging processes and materials that are gentle to natural resources. Many producers of packaging already are able to offer sustainable solutions for chocolate, biscuits, etc.
The European confectionery industry is one of the most dynamic and largest sectors in terms of production and export. More than 12,000 companies produce 14.7 million tons of confectioneries each year, says the European association Caobisco. Worldwide, however, the U.S.A. are the biggest producers of confectionery with a predicted turnover of 264 billion Euro in 2023 and the largest absolute growth, according to Euromonitor International, over the next five years.
Chocolate especially is what consumers prefer above all. In the European ranking by Chocosuisse in 2020, Switzerland led the per-capita consumption of chocolate with more than eleven kilograms per year, followed by Germany (9.2 kg), Estonia (8.3 kg) and Denmark (8.2 kg). Estonia even had the highest per-capita consumption of confectionery in 2022, according to Euromonitor – every inhabitant statistically ate a total of 13.6 kg. Prognostics say that this trend in the Baltic country will experience a large growth over the next five years.
A current survey by the German online platform Statista shows: Women eat more sweets. In the year 2022, about 34 per cent of women said they consume sweets or savoury snacks every day. The number for men was 23 per cent. In a different study, one quarter of the participants told the market investigators of POSpulse, that since the pandemic they have been consuming more sweets and snacks.
Manufacturers source the main raw ingredients for confectionery and snack foods mostly from Germany or the EU, according to the German Federal association BDSI. This makes the confectionery industry not only an important partner for the German and European agriculture, short transport distances also mean that it contributes to saving resources. International trade is of course important for the confectionery industry, too. Using roughly 400,000 tons of cocoa, the most important raw ingredient for chocolate, German manufacturers of confectionery process ten per cent of the global annual crop. All in all, European manufacturers use about half of the world’s available cocoa, according to Caobisco.
Currently, the industry like many others faces an existential crisis: Exploding costs for energy and raw materials, but also disruptions to delivery chains and the availability of raw materials disproportionately affect small and mid-size family businesses. For example, in autumn 2022, the cost increase for sugar was 100 per cent, butter was 57 per cent more expensive, and wheat 60 per cent. “For our companies, the enormous pressure from rising costs leads to them questioning production sites or even their very existence. This is not only caused by the soaring cost of energy and raw materials in 2022, but also by negative pressure dependent on location, which in Germany has been higher than average for a long time. This includes expenditures on wages, taxes and the growing lack of qualified personnel”, says Dr. Carsten Bernoth, CEO of the German Federal association of German producers of confectionery (BDSI). ‘”For our producers, it is impossible to compensate for these considerably rising costs by saving or by proportionately raising sales prices.”
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