Bakery and snacks in Europe 2021

Bakery and snacks in Europe 2021

Regions in the Spotlight 12-23 April 2021

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Contents The movement towards healthier . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Market value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Provenance in the spotlight . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 No one-size-fits-all . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Protein, grains and seeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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Functional foods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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Balancing health and indulgence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Key takeaways . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

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Regions in the Spotlight 12-23 April 2021

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The movement towards healthier There has been a strong push toward healthier baked goods and snack products across Europe, including efforts to cut salt, sugar and saturated fat.1 But in recent years the concept of healthier products has become more sophisticated, with consumers and manufacturers alike investing in nutrition, alongside pleasure. After all, taste consistently comes out as a top driver of food purchases in consumer surveys, even as consumer understanding of healthy dietary habits has increased. 2 Some of the major trends3 in healthier baked goods and snacks include: • Plant-based products and ingredients (like vegetables, whole grains and legumes, for example).

• Healthier fats and oils.

• Functional products such as those with added fibre or protein, or ingredients intended to improve digestive health, brain health, mood, etc.

• Smaller portion sizes – a trend that has been given an unexpected boost from the COVID crisis, as individual portions have gained favour due to hygiene concerns.4 However, when it comes to bakery and snack products, there is always room for indulgence, too, and nostalgia has come to the fore during 2020. According to Innova Market Insights, the trend is likely to continue into the year ahead; ‘modern nostalgia’ is one of its top ten trend picks for 2021.5 Mintel has highlighted ways in which companies are tapping into this trend, citing Cadbury’s UK reintroduction of its 1970s favourite Bourneville Old Jamaica Rum and Raisin chocolate bar, and Nestlé’s contemporary twist on its Quality Street range.6

Source: talkingretail.com7

Source: confectionarynews.com8

“Having launched in 1936, the heritage positioning of Quality Street makes it ripe for modern brand extensions as a means of enticing new consumers and encouraging experimentation among fans of the classic variant,” the report said.9 Natural flavours have also become increasingly important to Europeans, and even major leading companies like Nestlé10 and Danone11 have removed artificial flavours from their products.

“Natural flavours are in high demand in the European market partly because of their relatively low costs and rising consumer demand for natural products,” according to the Netherlands’ CBI, the Centre for the Promotion of Imports from developing countries.12

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Market value The European Union is the number one exporter and number two importer of foods and drinks in the world, according to the trade association FoodDrinkEurope.13 EU imports of bakery and farinaceous products (those made from starchy crops) were worth €932 million in 2019, an 11% increase from the previous year.14 Altogether, Europeans bought about €17 billion worth of savoury snacks in 2018, equivalent to nearly 1.5% of the region’s food and beverage market.15

Provenance in the spotlight Certain ingredients are on the rise, like coconut oil, while others are falling out of favour, such as palm oil, especially as many Europeans place value on the story behind certain ingredients or products.16 According to Innova Market Insights, “When it comes to sweets and snacks, ingredient provenance for raw materials such as nuts, cocoa, and sugar is increasingly being highlighted, along with ethical credentials and packaging sustainability.”17

No one-size-fits-all Although some trends are common to the region as a whole, the European market is varied. The European Snacks Association (ESA) notes that snacks in France, for instance, tend to be enjoyed as an aperitif, while in Germany they are a common accompaniment to social occasions with family and friends.18 The UK is the largest snack market in Europe, and UK consumers are more likely to eat snacks on the go for energy, or as a treat during the day. However, consumers in the Netherlands, Germany and Spain buy more snacks per capita, according to the ESA.19 Countries also differ in their preferences for certain baked goods and snacks. Research from PwC found UK consumers bought the most crisps/potato chips, at 3.4 kg per person in 2017, followed by Spain and the Netherlands, both at 2.8 kg. Meanwhile, Italians bought the most baked goods, at 14.7 kg per person, followed by Germany (13.2 kg) and France (12.1 kg), and Dutch consumers topped sweet biscuit consumption at 8.3 kg per person, ahead of UK (7.3 kg) and Italian consumers (6.2 kg).20

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Protein, grains and seeds Globally, 39% of consumers would like to increase their protein intake, according to research from FMCG Gurus, and 21% look for everyday products with added protein.21 Richard Charpentier, founder of Bakery Innovation, says cereals and grains are an interesting option to increase protein in baked goods, and each provides different characteristics. Spelt has a chewy texture, for example, while kamut is more nutty and buttery, teff is slightly sweet, amaranth is earthy, and sorghum contributes a slight bitterness. At Fi Europe CONNECT 2020 Charpentier told delegates that;

“Protein is not about throwing protein in your formula and saying, ‘this is good’.

It’s about understanding their uniqueness and the unique functionalities that they all have.”22 According to CBI, the European trend towards healthier bakery and snack products is reflected in rising import values. Its figures show that European imports of protein-rich pulse flour grew 136% from 2014-18, mainly from India; natural unroasted cereal flakes and mixes were up 63% during the same period, with North Macedonia being the biggest supplier; and gluten-free bulgur imports grew 41%, mainly from Turkey.23 “Basic ingredients can also count on more export going forward, among which chickpeas, lentils, sunflower seeds, chia seeds, oats and rye,” it said.24

Functional foods Snacks with added health benefits, such as brain health or slow release energy, are attractive to consumers seeking ways to improve their wellbeing.25 As well as added benefits, these products often reflect the ‘clean label’ trend, featuring ingredients that are some combination of raw, natural, organic, unprocessed and plant-based.

Nooro Banana and Cinnamon Oat Flapjack "This raw and vegan product is made with natural nootropics and contains 25mg CBD, a natural constituent of hemp sourced from a small independent UK grower. It is high in fibre, and contains: cacao nibs, with antioxidant properties; maca and L-theanine for cognitive function; oats to slow release energy; peanut butter, a source of healthy fat; and chicory root fibre for gut and digestive health."26 Mintel GNPD 26

According to CBI, choosing the right European target markets for such products requires an understanding of local snack culture and attention to healthy eating.27 “In the United Kingdom and the Netherlands, snack producers are looking for ways to make on-the-go eating healthier,” it said. “In Germany, France and the Nordic countries (Sweden, Denmark, Norway and Finland) consumers focus on the organic and social value of healthy snacks.”28

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Balancing health and indulgence Sugar remains European consumers’ ingredient of top concern, according to Mintel, 23% of all snack/cereal/ energy bars launched in 2019 carried a ‘low/no/reduced sugar’ claim.29 Reduction is no longer limited to diet products or niche brands, with major players like Cadbury30 and Premier Foods31 releasing lower sugar versions of their mainstream products.

For manufacturers, there is a balance to be struck as they face mounting pressure from policymakers,32 and even consumers themselves, about the nutritional value of their products.

Key takeaways • Ingredients like vegetables, legumes and healthy fats are on the rise.

• Increased focus on ingredient provenance, including ethical and sustainable sourcing.

• Bakery and snacks with added nutritional value often feature protein, fibre, or ingredients with specific functional claims such as brain health, digestive health, immune support, etc.

• Comfort and nostalgia remain important drivers for bakery and snack purchases.

• Importers should be aware that European tastes and preferences vary widely.

• Demand for added protein is boosting sales of naturally protein-rich ingredients.

• Health benefits often go hand-in-hand with other claims, like organic or vegan.

• Sugar reduction is a key trend across Europe, reflected in both policy and consumer demand.

The information provided here was compiled with due care and up to date to the best of our knowledge on publication.

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Sources https://www.up2europe.eu/european/projects/novel-processing-approaches-for-the-development-of-food-products-low-in-fat-saltand-sugar_15360.html 2 https://publications.jrc.ec.europa.eu/repository/bitstream/JRC91330/lbna26821enn.pdf 3 https://www.figlobal.com/content/dam/Informa/figlobal/fieurope/en/2020/documents/HLN20FIE-ES-Snacking-the-modern-way.pdf 4 https://www.canteen.com/research-and-trends/post-covid/ 5 https://www.innovamarketinsights.com/innova-identifies-top-10-food-and-beverage-trends-to-accelerate-innovation-in-2021/ 6 Mintel, A year of innovation in chocolate confectionery, 2020 7 https://www.talkingretail.com/products-news/confectionery/cadbury-kicks-off-new-year-old-favourite-02-01-2020/ 8 https://www.confectionerynews.com/Article/2020/02/24/Nestle-launches-its-first-Quality-Street-product-in-almost-85-years 9 Mintel, A year of innovation in chocolate confectionery, 2020 10 https://www.nestle.com/media/news/launch-organic-nestle-breakfast-cereals 11 https://www.danone.com/stories/articles-list/snack-to-the-future-the-future-of-food-trends.html 12 https://www.cbi.eu/market-information/natural-food-additives/what-demand 13 https://www.fooddrinkeurope.eu/uploads/publications_documents/FoodDrinkEurope_-_Data__Trends_2020_digital.pdf 14 https://comtrade.un.org/ 15 https://www.esasnacks.eu/industry.php 16 https://www.innovamarketinsights.com/innova-identifies-top-10-food-and-beverage-trends-to-accelerate-innovation-in-2021/ 17 https://www.innovamarketinsights.com/sweet-snacks-innovation-boosted-by-successful-sustainability-storytelling/ 18 https://www.esasnacks.eu/industry.php 19 https://www.esasnacks.eu/industry.php 20 https://www.pwc.nl/en/industries/retail-and-consumer/deals-in-rc/european-snacking-market.html 21 https://www.figlobal.com/content/dam/Informa/figlobal/fieurope/en/2020/documents/HLN20FIE-GM-Global_consumer_trends_in_the_ protein_market_FMCG-Gurus.pdf 22 Fi Connect 2020, presentation by Richard Charpentier, “How to reformulate for the future” 23 https://www.cbi.eu/market-information/grains-pulses-oilseeds/healthy-snacks/market-potential 24 https://www.cbi.eu/market-information/grains-pulses-oilseeds/healthy-snacks/market-potential 25 https://www.figlobal.com/content/dam/Informa/figlobal/fieurope/en/2020/documents/HLN20FIE-ES-Snacking-the-modern-way.pdf 26 https://www.gnpd.com/sinatra/recordpage/7427731/ 27 https://www.cbi.eu/market-information/grains-pulses-oilseeds/healthy-snacks/market-potential 28 https://www.cbi.eu/market-information/grains-pulses-oilseeds/healthy-snacks/market-potential 29 https://clients.mintel.com/report/a-year-of-innovation-in-snack-bars-2020?fromSearch=%3Ffreetext%3Dsnacks 30 https://www.cadbury.co.uk/products/cadbury-dairy-milk-30-less-sugar-29985 31 https://www.premierfoods.co.uk/Media/Latest-News-Stories/News-2020/Mr-Kipling-Adds-Some-Zest-to-Reduced-Sugar-Range. aspx?feed=news 32 https://ec.europa.eu/docsroom/documents/6150/attachments/1/translations/en/renditions/native 1

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