Press Release Summary = The rising awareness and uptake of vegetarianism as a method of addressing health related food scares (such as BSE/CJD) and animal cruelty issues, plus the fact that broadening ranges of vegetarian products are bringing the sector into the mainstream foods market, have resulted in the need for Key Note to produce a new report on vegetarian foods.
Press Release Body = Vegetarian Foods Market Assessment
The rising awareness and uptake of vegetarianism as a method of addressing health related food scares (such as BSE/CJD) and animal cruelty issues, plus the fact that broadening ranges of vegetarian products are bringing the sector into the mainstream foods market, have resulted in the need for Key Note to produce a new report on vegetarian foods. This report, which includes current retail sales data from Information Resources and consumer purchasing data from National Opinion Poll (NOP) Solutions, presents the most detailed and comprehensive study to date on the market. Other important information sources used in compiling the report have been The Vegetarian Society, the Realeat surveys from Haldane Foods, and government publications detailing longer-term trends in meat eating.
The vegetarian foods market has been divided and surveyed in five main sectors, namely ready meals (including snack meals), sausages/burgers/grills, bakery (pastry) products, meat substitute ingredients, and other (largely delicatessen) products such as sliceable meats, pâtés, pastes, etc. This breakdown largely follows previous Key Note reports and, more importantly, the market categories of Information Resources - whose data is recognised by the trade. It also answers a major challenge faced by other report writers, that of presenting relevant and consistent data in terms of products covered. Substantial retailer coverage of all major multiples makes the inclusion of extra sales (estimated at 8-9% for sales through health food shops, convenience stores, etc.) necessary to reach a total market size.
Changing priorities and price deflation resulting from strong competition, have meant that any growth in household expenditure on food/drink has fallen behind other areas, such as motoring and leisure services, in recent years. More significantly, household spend on meat has been falling, principally with regard to beef and beef sausage, which have been affected by health scares and lifestyle issues. The decrease in meat consumption would have been greater had it not been for the growth in poultry sales, and all decline will in part relate to the spread of vegetarianism. This is supported by the fact that there is a greater fall in spend on meat within younger age group households, and it is well proven that vegetarianism is much stronger among the young (and particularly among females). However, the culture will undoubtedly spread to older age groups in time, addressing the challenge of a gradually `greying\' population comprising an increasing proportion of over 35s.
The proportion of vegetarians is slowly increasing, with double the number of females than males within the category. Although currently the proportion of vegetarianism falls as age increases, there has been a flattening of the profile of vegetarians within socio-economic groupings. This supports the trend towards a mainstream market positioning for vegetarian foods, having originally held a niche and AB position, strengthened by ever wider product ranges and distribution through major multiple retailers.
Vegetarian foods, by no means all consumed by vegetarians, have tended to imitate traditional meat, fish and other dishes in form - as ready meals, sausages and burgers, crumb coated products such as grills and fingers, pastry bakery items such as pies, cold meats and pâtés for salads, and even the ingredient mince. They were largely visible originally in the frozen sector, but have grown more significant recently in chilled foods. Frozen vegetarian foods accounted for nearly half of market value in 1995, but only around 40% in 2000. The whole vegetarian foods market grew relatively substantially in value terms in the early and mid-1990s, slowed in 1998 and 1999, and declined in 2000. To address this latest decline, several manufacturers have added organic vegetarian foods to their existing ranges, which are reportedly selling well.
Ready meals, including snack meals, account for the largest value share of the market - currently, 45% of sales through multiples and Co-ops. This share is expected to increase in future since the convenience of ready meals and their variety fit in with current lifestyle changes such as fragmented family mealtimes and the high proportion of working women. Ready meal ranges have moved from traditional meals to the much more popular ethnic and pasta style dishes, with growth being more significant in retailer own brand chilled products than in any frozen dishes.
The sausages/burgers/grills sector, broadly the original vegetarian foods market, is now fairly static in growth potential and the area of lowest forecast growth in future. The sector holds a 21% value share of vegetarian foods sales through multiples and Co-ops, and is much the strongest area for frozen products. It is also a stronghold of brands, with the other major sectors - ready meals and bakery products - being substantial growth areas for retailer own label.
Bakery products have proved a growing market sector, and one which is forecast to produce medium growth in future. The sector also currently holds a 21% value share, with many of the items (and all growth) being in the chilled area.
The smaller sectors of the vegetarian foods market appear to have held up better in 2000 than the larger ones. The meat substitute sector has held on to its 9% value share, and the `others\' sector comprising largely sliceable `meats\' and pâtés, with only a 4% value share of sales through multiples and Co-ops, has seen sales improve in 2000 by some 39%.
Major food producers have now moved into the vegetarian foods market to become the major suppliers. Heinz Frozen and Chilled Foods has become one of the most well known since its acquisition in 1999 of the Linda McCartney brand (and Ross Young non-meat products) from UB Foods. Unilever\'s Birds Eye Walls company is a major player with its vegetable based burgers, fingers and other products, plus its Meatfree ready meals. The Astra-Zeneca-owned Marlow Foods supplies a wide range of its myco-protein Quorn brand products.
Other smaller but important (and often original) manufacturers are the Cavaghan and Gray (Northern Foods) owned Dalepak, Rayner Foods Group\'s Cauldron Foods, Adm-owned Haldane Foods, and the Israeli company Tivall. The vegetarian foods market also comprises vegetable based and other products from the Nestlé frozen foods manufacturer Findus, and the frozen sausages/burgers/grills company Freshbake, part of Campbells Foods spin-off Vlasic. Many of these companies also produce for retailer own labels.
Sales of vegetarian foods are forecast to continue to decline in 2001, admitting market maturity but estimating a much slower decline than in 2000 due to the positive effects of improved sales of organic and other products. Higher growth is anticipated from the second half of 2002 onwards.
2025
