Breakfast cereals, typically produced from processed grains, can be consumed in dry, hot, or cold form. Kellogg’s introduced the first patented breakfast cereal in the form of cornflakes in 1895. Since then, breakfast cereals have created a multibillion dollar market on a global level. The global breakfast cereals market was valued at US$ 32.5 Bn in 2012, and the revenues are expected to reach US$ 43.2 Bn by the end of 2019. The market will expand at a CAGR of 4.1% over the forecast period, 2013-2019.
Key market Dynamics
Packaged breakfast cereals have been witnessing immense popularity in developing economies, as consumers are increasingly preferring packaged, healthier food options over traditional, customary food for breakfast. Due to lower calorific value and higher nutritional content, these cereals are considered to be an ideal breakfast option worldwide. With rising awareness about the importance of healthy breakfast, the demand for breakfast cereals is expected to gain a major boost. Nutritional breakfast is being increasingly recommended for physical activeness, lower risk of chronic diseases, balanced levels of insulin and cholesterol, improved memory, and many more health benefits. Breakfast cereals form an important sector of the packaged food industry, and will continue to propel as the parent market thrives. Gluten-free cereals are trending high in the market, especially in North America and Europe. Moreover, whole grain cereals also highlight a popular trend, holding a positive impact on the market growth. A large number of innovative and flavored options in breakfast cereals are likely to accelerate the market growth, especially in developing markets.
However, manufacturers have to face multiple issues related to raw material procurement. This is expected to continue over the forecast period, posing a major challenge to the market growth. Despite a growing number of convenience stores in developing economies, rising commodity and energy prices will remain long-term restraints. Gluten content in cereals are being constantly scrutinized by consumers as well as governments, compelling companies to increase their gluten-free product range.
There are two key segments of the global breakfast cereals market viz. hot cereals and RTE (ready-to-eat) cereals. The RTE cereals segment registered a value of US$ 27.8 Bn in 2012, and will remain the higher market shareholder over the forecast period. The hot cereals segment will however witness a relatively higher CAGR, attributed to burgeoning consumption in Asian countries.
Developed regions, such as North America have been early adopters of breakfast cereals. Despite being the leading market with a value of nearly 13.9 Bn in 2012, North America is currently saturated and is expected to witness a decline in the next few years. As consumers in developed regions are gradually seeking options in traditional breakfast and modern, on-the-go food packets against cereals, the market in North America is strongly foreseen to lose its key market position and revenue share to Asia Pacific, which is expected to be a major market for breakfast cereals by 2019 end. Growing popularity of cereal bars will continue in North America in the near future. On the other hand, Asian countries like India and China, especially due to exploding population, will represent the highest growth potential for the market. China is expected to continue to present a number of growth opportunities to breakfast cereal companies. The market will also witness significant growth in some regions of Latin America.
To deduce the global breakfast cereals market size, the report considers various aspects based on secondary research. Furthermore, key data points such as region-wise split and market split by product type, vehicle type, and distribution channel; and qualitative inputs from primary respondents have been incorporated to arrive at appropriate market estimates. The forecast presented in the report assesses the total revenue generated and expected revenue contribution in the global breakfast cereals market.
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The report begins with sizing the market in terms of value and volume for the base year, which forms the basis for forecasting how the market is anticipated to take shape in the near future. Given the characteristics of the market, gathered data is triangulated via different analysis based on supply side and demand side drivers and other key dynamics of the global breakfast cereals market. To develop the market forecast, Persistence Market Research has also conducted a factor analysis to understand the impact of various forces/factors on the target market. The report provides forecasts not only in terms of CAGR but also presents a detailed analysis based on key parameters such as Year-on-Year (Y-o-Y) growth to understand market predictability and to identify the right opportunities.
Another key feature of this report is an analysis of the global breakfast cereals market and the corresponding revenue forecast in terms of absolute dollar opportunity, usually overlooked while forecasting the market. However, absolute dollar opportunity is critical in assessing the level of opportunity that a provider can look to achieve, as well as to identify potential resources from a sales perspective in the global breakfast cereals market. Further, to understand key segments in terms of their growth and overall global breakfast cereals market performance, Persistence Market Research has developed a market attractiveness index to help providers identify existing market opportunities in the global breakfast cereals market.
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Key Market Players
Leading players are consistently introducing innovative, fiber-rich, fruit flavored products with reduced fat content and oils. Kellogg’s have been the undisputable market leader since years. The other two key markets, PepsiCo General Mills, also have significant market shares. These three players collectively govern the global market with over 50% of the revenue share. Another notable market player is Cereal Partners Worldwide (CPW), which is a joint venture between General Mills and Nestle. CPW has grabbed a sizeable market within a shorter span, and is expected to witness higher growth rate during the forecast period.