Definition of Market/Industry:
Frozen food is food that has a longer shelf-life as it is preserved under low-temperature in the refrigerator. They are classified into ready-to-eat, ready-to-cook, ready-to-drink, and other frozen food which includes frozen meat and fish, fruits and vegetables, desserts, snacks, and frozen meat. Frozen food are easily available at convenience stores, supermarkets & hypermarkets, and online channels.
The global frozen food market is estimated to account for US$ 1,52,741.60 Mn in terms of value by the end of 2019, witnessing a CAGR of 4.7% during the forecast period (2020 to 2027).
Robust growth in the urban population is propelling the market growth of the frozen food. According to the United Nation, 55 percent of the world’s population i.e. 4.2 billion were residing in urban areas in 2018. By 2050, the number of urban population is projected to increase by 68 percent which will add another 2.5 billion to the world’s urban population driven by an overall population increase and by the upward shift in the percentage living in urban areas. Thus, growth in the urban population is projected to foster the market growth.
Robust growth in the retail sector around the globe due to growing consumer purchasing power is projected to bring new market opportunities in the near future. This is attributed to the expansion of the distribution channel and increasing spending on development of the public infrastructure around the globe. Also, increasing use of online platforms for purchasing products by consumers due to ease of conveniences and various discount offered is again projected to propel the market growth of the frozen food.
The presence of local brands in the market is creating a barrier for multinational companies entering into the market. This compelled larger companies to change their pricing strategy before entering. Also, consumers are highly unaware of the branded products which is again creating challenges for the large manufacturer to position their products in the market.
On the basis of product the frozen ready meals segment dominated the global frozen food market in 2019, accounting for 24.35% share in terms of value, followed by frozen sea food and frozen meat products, respectively
The influence of western culture on food habits across developing countries due to globalization is one of the trends in the market. Growing consumption of the on the go snack and food is also projected to accelerate the market growth of the frozen food products. The increasing demand for French fries coupled with the growing demand for frozen food with nutrients and increasing population across developing countries such as India and China is further projected to augment the market growth of the frozen food.
The increasing trend of consuming ready-to-eat food among college and working population is expected to bolster the market growth of the frozen food. U.S. China and India are the major markets for ready-to-eat food products. According to the United States Department of Agriculture Economic Research Service, in 2019, food spending by U.S. consumers, businesses, and government entities totaled $1.77 trillion. Food away-from-home accounted for 54.8 percent of total food expenditures. Americans spent an average of 9.5 percent of their disposable personal incomes on food—divided between food at home (4.9 percent) and food away from home (4.6 percent).
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Global Frozen Food Market - Impact of Coronavirus (Covid-19) Pandemic
Food being an essential commodity, the demand for food products is expected to rise during the pandemic and post pandemic conditions, worldwide. Having said that, Coronavirus (Covid-19) has majorly impacted the food & beverages industry and in turn has changed the dynamics of entire ecosystem including raw material suppliers, supplying food ingredients. Lockdown in various nations such as India, China and Spain, among others and cease in the subsequent trade activities has paralyzed the supply chain. Moreover, owing to rising health awareness among consumers globally there is a surge in the demand for packed food products, which is further expected to increase the demand for frozen food products during the COVID pandemic.
Few Recent Developments
In April 2020, Nestle SA is launching Life Cuisine, a new brand designed to “feed modern lifestyles. The lineup includes frozen bowls, egg bites, and pizzas that cater to four consumer preferences: high-protein, low-carb, meatless, and gluten-free.
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