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  • Published On : Feb 2022
  • Code : CMI4932
  • Industry : Food and Beverages
  • Pages : 80
  • Formats :

Food is the primary source of important nutrients that the human body requires to function properly. Similarly, infants require sustenance for optimal development and growth, which is primarily obtained through breast milk. Breast milk can be replaced with infant nourishment. BPOM (The National Agency for Drug and Food Control of Indonesia) have updated the definition for food and food products in the Indonesia. BPOM is an Indonesian government agency tasked with safeguarding public health through regulation and oversight. According to BPOM, food is everything coming from biological resources and water, whether processed or not, designated as food or drink for human consumption, including food supplements, food raw materials, and other materials used in the process of preparation, processing, and/or production of food or beverage. Processed food is the food or beverage resulting from a process in a certain way or method with or without added ingredients. Functional food is processed food containing one functional component or more, which are based on scientific analysis and has certain physiological functions and is proved to be beneficial to health.

Indonesia infant nutrition market is projected to surpass US$ 9.90 Bn by the end of 2028 and exhibit a CAGR of 7.16% during the forecast period (2021 to 2028).

Drivers

Marketing strategies adopted by infant nutrition product manufacturers in Indonesia are creating awareness about the importance of feeding specialty baby food and infant formulas. For instance, PT Frisian Flag Indonesia Company is engaged in conducting local contests and offers rewards for winners. For instance, in 2017 the winners of a company contest had their family message displayed on the packaging of sweetened condensed milk products Frisian Flag and each got a monthly supply of Frisian Flag milk products for a whole year. Also, 30 weekly winners were shown their message in Kompas newspaper and each will get the product package from Frisian Flag.

Increasing demand for organic food for babies is expected to fuel the Indonesia infant nutrition market growth. Modern farming techniques utilize chemical fertilizers, pesticides, and preservatives. The presence of these chemical contaminants in food has various short-term and long-term consequences on infant and child health. For instance, the preservative nitrite, is converted into carcinogenic compound nitrosamines, by the human body. Whereas, fresher and more nutritional food helps to boost the overall development of the infant, resulting in a strong and robust immune system.

Market Restraints

The current legislation in Indonesia prohibits manufacturers and distributors from promoting and advertising formula milk for infants aged 6 months and below in health facilities. Also, healthcare facilities and healthcare workers are not permitted to sell, give, or promote the formula milk for infants. In addition, there are some limited restrictions on the labelling and advertising of milk products for infants below the age of 1 year. These regulations may negatively impact the infant nutrition market growth and pose as a major challenge for global and local manufacturers and raw material providers in Indonesia.

Market Opportunities

According to the Indonesian Food and Beverage Association’s (Gapmmi) study, Indonesia's food and beverages industry has been estimated conducted to exhibit significant growth of around 8.5 percent (y/y) in 2017. In addition, Indonesia is the most lucrative market for Foreign Direct Investment (FDI). According to Badan Koordinasi Penanaman Modal’s (BKPM) data, FDI in Indonesia's food and beverages industry accounted for US$ 1.5 Bn in 2015. The expansion of the food industry is thus expected to create opportunities for global and local key players to tap potential markets for dietary supplements, especially in emerging economies.

Figure 1. Indonesia Infant Nutrition Market – Opportunity Analysis

Indonesia Infant Nutrition  | Coherent Market Insights

Market Trends

According to World Bank, Indonesia is the fourth-largest populous country in the world. For convenient services and attractive offers, stores including convenience and departmental stores, supermarkets, hypermarkets, etc. are ensuring the availability of different products under one roof. So for customers, it is easy to purchase of daily goods in large quantity. Stores, supermarkets, hypermarket etc. are already established trust among people is the key driver, expected to boost growth infant nutrition market over the forecast period.

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Indonesia Infant Nutrition Market Report Coverage

Report Coverage Details
Base Year: 2020 Market Size in 2020: US$ 5.72 Bn
Historical Data for: 2017 to 2020 Forecast Period: 2021 to 2028
Forecast Period 2021 to 2028 CAGR: 7.16% 2028 Value Projection: US$ 9.90 Bn
Geographies covered:
  • Indonesia
Segments covered:
  • By Product Type: Baby Food and Infant Formula
  • By Distribution Channel: Hypermarket, Supermarket, Specialty Store, Online, and Others
  • By Formulation: Ready to Eat, Powder, and Liquid
Companies covered:

Nestlé S.A., Groupe Danone, PT Kalbe Farma Tbk, PT Indofood Sukses Makmur, Indofood CBP, Mirota KSM, Nutricia Indonesia Sejahtera, Sari Husada, Mead Johnson Indonesia, and PT Frisian Flag Indonesia

Growth Drivers:
  • Increasing awareness about the importance of nutrition for babies
  • Increasing demand for organic baby food
Restraints & Challenges:
  • Strict government regulations imposed on infant formula & baby food products

Figure 2. Indonesia Infant Nutrition Market Revenue Share (%), By Formulation in 2020

Indonesia Infant Nutrition  | Coherent Market Insights

Key Takeaways of the Graph:

  • Among the formulation segment, powder sub-segment held the dominant position and accounted for 43.30% share of Indonesia infant nutrition market in 2020. The segment value is expected to reach US$ 4.31 Bn in 2028.
  • Powdered infant nutrition products are expected to gain popularity due to their higher shelf life as compared to other baby food products. Babies with certain medical conditions are also advised to be fed with powdered formula or milk, as these powders consist of added fortified nutrients such as iron, calcium, and vitamins.

Indonesia Infant Nutrition Market - Impact of Coronavirus (COVID-19) Pandemic

The rising number of the COVID–19 cases is expected to have a short-term negative impact on the nutrition sector's export-import trade. The nutrition segment's short-term impact is less pronounced; however, the negative impact of the COVID-19 on the global economy may have significant indirect effects on the nutrition market. For example, market participants and the government are heavily invested in ensuring the supply of essential nutrition and food. The majority of baby food manufacturers were found to be concentrating on increasing production to ensure availability.

Baby food was designated as an essential good during the COVID-19 pandemic, and as main retail distribution channels were allowed to remain open, stockpiling resulted in significant increases in retail sales. Although, the above-mentioned trend was seen in both developed and developing economies, the latter experienced slower growth due to supply chain disruption and consumers spending less during the economic downturn.

Competitive Section

Major players operating in Indonesia infant nutrition market include, Nestlé S.A., Groupe Danone, PT Kalbe Farma Tbk, PT Indofood Sukses Makmur, Indofood CBP, Mirota KSM, Nutricia Indonesia Sejahtera, Sari Husada, Mead Johnson Indonesia, and PT Frisian Flag Indonesia.

The infant nutrition product market is broadly classified as baby food and infant formula. Infant nutrition refers to the dietary requirements of infants. A diet that is deficient in essential calories, minerals, vitamins, or fluids is deemed insufficient. When compared to infant formula, breast milk provides the best nutrition during the crucial early months of growth. Infant nutrition necessitates the provision of essential nutrients that promote normal growth, development, and resistance to infections and diseases.

Market Dynamics

The increasing number of campaigns organized by the government, in association with private infant nutrition product manufacturers, to increase awareness about the importance of nutrition for babies is projected to boost the demand for infant nutrition products in Indonesia. For instance, the Global Alliance for Improved Nutrition (GAIN), in collaboration with the Directorate of Community Nutrition, Ministry of Health Indonesia, is engaged in a project to increase the sustainable improvement of Maternal, Infant and Young Child Nutrition (MIYCN) in East Java, Indonesia. Under this project, the Behavioral Change Intervention (BCI) to be implemented in East Java aims to improve the nutritional intake for children aged 24 months and below from low-income families by providing them with baby food products.

The demand for convenient baby food has increased among consumers as a result of growing awareness about the complete nutritional needs of growing babies, met by infant nutrition. Furthermore, rising urbanisation in Indonesia, combined with an increase in the number of women in the workforce, is expected to propel the infant nutrition market forward.

According to World Bank, Indonesia is the fourth-largest populous country in the world; however, the birth rate of the country is declining. Between 1966 and 2016, the birth rate of Indonesia recorded a moderate decline from 42.3 per 1,000 people in 1966 to 16.4 per 1,000 people in 2016. The decreasing birth rate in the country is thus expected to hinder the Indonesia infant nutrition market growth.

Key features of the study:

  • This report provides an in-depth analysis of Indonesia infant nutrition market, market size (US$ Billion), and compound annual growth rate (CAGR%) for the forecast period (2021–2028), considering 2020 as the base year
  • It elucidates potential revenue opportunities across different segments and explains attractive investment proposition matrices for this market
  • This study also provides key insights about market drivers, restraints, opportunities, new product launches or approval, market trends, regional outlook, and competitive strategies adopted by key players
  • It profiles key players in Indonesia infant nutrition market based on the following parameters – company highlights, products portfolio, key highlights, financial performance, and strategies
  • Key companies covered as a part of this study include Nestlé S.A., Groupe Danone, PT Kalbe Farma Tbk, PT Indofood Sukses Makmur, Indofood CBP, Mirota KSM, Nutricia Indonesia Sejahtera, Sari Husada, Mead Johnson Indonesia, and PT Frisian Flag Indonesia
  • Insights from this report would allow marketers and the management authorities of the companies to make informed decisions regarding their future product launches, type up-gradation, market expansion, and marketing tactics
  • Indonesia infant nutrition market report caters to various stakeholders in this industry including investors, suppliers, product manufacturers, distributors, new entrants, and financial analysts
  • Stakeholders would have ease in decision-making through various strategy matrices used in analyzing Indonesia infant nutrition market

Detailed Segmentation:

  • Indonesia Infant Nutrition Market, By Product Type:
    • Baby Food
    • Infant Formula
  • Indonesia Infant Nutrition Market, By Distribution Channel
    • Hypermarket
    • Supermarket
    • Specialty Store
    • Online
    • Others
  • Indonesia Infant Nutrition Market, By Formulation:
    • Ready to Eat
    • Powder
    • Liquid
  • Company Profiles
    • Nestlé S.A.*
      • Company Overview
      • Product Portfolio
      • Financial Performance
      • Key Strategies
      • Recent Developments
      • Future Plans
    • Groupe Danone
    • PT Kalbe Farma Tbk
    • PT Indofood Sukses Makmur
    • PT Frisian Flag Indonesia
    • Indofood CBP
    • Mirota KSM
    • Nutricia Indonesia Sejahtera
    • Sari Husada
    • Mead Johnson Indonesia

 “*” marked represents similar segmentation in other categories in the respective.

Frequently Asked Questions

Indonesia infant nutrition market is estimated to be valued at US$ 6.10 Billion in terms of revenue in 2021.
Increasing awareness about the importance of feeding specialty baby food and infant formulas and demand for organic baby food are expected to drive the market growth.
Among formulation, powder is the leading segment in Indonesia infant nutrition market and accounted for 43.30% share in 2020.
Some limited restrictions on the labelling and advertising of milk products for infants below the age of one year are hindering the market growth.
Major players operating in the market include Nestlé S.A., Groupe Danone, PT Kalbe Farma Tbk, PT Indofood Sukses Makmur, Indofood CBP, Mirota KSM, Nutricia Indonesia Sejahtera, Sari Husada, Mead Johnson Indonesia, and PT Frisian Flag Indonesia

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