• Though nut and chocolate spread segments are growing in many markets, fruit spread volumes are struggling

• Despite concerns over sugar consumption, fewer than one in 10 sweet spread launches make low/no/reduced sugar claims

• In savoury spreads, a desire for healthier Mediterranean-style snacks drives growth of chilled dips

Globally, 2015 has been a year of reasonable growth for the sweet spread market. It is estimated that 2015 saw a net 1.3% volume growth across 33 major markets with overall volumes increasing by approximately 36 thousand tonnes. This is a significant increase in the growth rate from 2014, when markets were static.

Though the tiger economies of Asia invariably are the fastest-growing sweet spread markets in percentage terms, often the growth is from a small base, as sweet spreads are still seen as a “western” food and their consumption often is not embedded in local culinary traditions. In terms of tonnage, China aside, the fastest growing markets come from Latin America (Brazil and Mexico) or Europe (Russia, Italy and France). However, it is notable that in many European and Latin American markets the traditional core category of fruit spreads is often struggling and growth comes from a mixture of nut- and chocolate- spread segments.

The relative health of European sweet spreads markets is reflected in the region’s dominance of new product activity, accounting for three of the top five most active markets. The other active markets include Brazil, where a raft of low-sugar products has boosted market activity, and the US, where a new wave of artisanal nut spread producers is helping energize market sales.

Figure 1: Fastest and slowest growing sweet spread markets by retail value, last five years

Source: Source: Vietnam Ministry of Industry and Trade, Vietnam Beekeepers Association (VBA), Economist Intelligence Unit, Russian Federal State Statistics Service, Office of the Economic Advisor - Ministry of Commerce & Industry -Government of India, Raddar CKG, DANE, The Ministry of Economy, Trade and Industry of Japan, The Ministry of Agriculture, Forestry and Fisheries of Japan, Fuji-Keizai Group, The Nielsen Company, INE, Mintel

Though concern over sugar content remains a considerable obstacle for fruit spread sales, this hasn’t prevented the development of other highly sugared spread segments, most notably premium chocolate and even biscuit spreads (also known as cookie butter in the US).

It is likely that chocolate and biscuit spreads are seen as more occasional permissible luxuries, whereas fruit spreads sales suffer thanks to a reduction in already established, and relatively high, consumption habits.

Despite consumer concern over sugar, few spread launches appear to make a feature of low sugar propositions. Globally fewer than one in 10 launches make low/no/reduced sugar claims. This rises to one in five across Latin America.

While the fragmented nature of savoury spreads makes a total category sales estimate difficult, the relative health of the market can be assessed by the increase in new retail product activity. Globally, there was no significant difference in the number of new savoury spread launches in 2015 vs 2014. While at a first glance this may indicate a market struggling for growth, it should be noted that 2014 was one of the most active years for savoury spread launches, with the number of new launches up by 20% vs 2013. So this suggests this is still a market in good health. The majority of new product launches are to be found in Western Europe and European Union members account for four of the five most active markets in 2015.

The savoury spread innovation agenda has largely been driven by the growth of chilled categories both from dips, notably those inspired by Mediterranean products such as hummus, Greek yogurt and taramasalata and also by meat spreads and pâté, as noted by the wide number of meat flavours that dominate savoury spread launches.

Though 2015 appears to have broadly been a good year for both sweet and savoury spread categories some opportunities remain untapped, especially in the development of on-the-go solutions. Both sweet and savoury spreads have strong associations with particular day parts (respectively breakfast and lunch). However, the onset and growth of breakfast biscuits and other portable breakfast items means this is an increasingly competitive day part. Equally, most savoury spreads are associated with lunch, but as Mintel’s Attitudes Towards Lunchtime Foods - UK, October 2015 report shows, under 35’s in particular often buy their lunch out, the segment is potentially missing out on key consumers. The potential for greater growth in both segments exists and as the example of Ferrero’s Nutella & Go demonstrates, success may be found in the development of more portable dip and chip snack packs.

Figure 5: Sweet Spreads, Global Market Performance

Note: The size of each bubble represents the respective size of the market in volume

Source: Source: Retail World, Economist Intelligence Unit, Information Resources, Inc., The Nielsen Company, Office of the Economic Advisor - Ministry of Commerce & Industry -Government of India, The Ministry of Economy, Trade and Industry of Japan, The Ministry of Agriculture, Forestry and Fisheries of Japan, Fuji-Keizai Group, Russian Federal State Statistics Service, Statistics Korea, U.S. Bureau of Labor Statistics, U.S. Census Bureau, U.S. Department of Agriculture, National Honey Board, Vietnam Ministry of Industry and Trade, Vietnam Beekeepers Association (VBA), Mintel

Please note: the market size data referenced in this report is current as of January 31, 2016