What factors will change the global demand for food in the coming years? There are four which are key: population, macroeconomics, prices, and “soft drivers”. With a firm grasp on all four, understanding large shifts in the food industry becomes much easier.
Population and demographics are the most predictable
The global population will add just over a billion people by 2040, creating significant additional demand for food that does not exist today. These new people will mostly be found in Africa or South Asia, driving global volumes in the coming years for many categories. Meanwhile, many developed countries can expect to see declining populations. Should this combine with widespread GLP-1 usage, a “calorie cliff” could occur for much of Europe and East Asia. An emphasis on premiumisation already underway will intensify under such conditions.
Volume challenges will hit hardest in child-orientated categories as global fertility rates continue to fall. This is not only the case in nearly the entire developed world but also major developing markets like China, Brazil, Russia, and Mexico. Emphasis in these key markets will increasingly shift to the needs of elderly populations as well as pets, both of which are growing in number.
The top 20 growth markets in pet care all currently have fertility rates of 2.0 children per woman or lower, showing where spending once going to children could end up in the future
The Guardian reported in June that pet care sales are now more important to Mars than its human food sales.
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The article is property of Euromonitor International, a data analytics company, and you can find it here.
