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The global confectionery market size was USD 188.52 billion in 2020. The global impact of COVID-19 has been unprecedented and staggering, with the products witnessing a negative demand shock across all regions amid the pandemic. Based on our analysis, the global market exhibited a significant decline of 7.1% in 2020. The market is projected to grow from USD 194.37 billion in 2021 to USD 242.53 billion in 2028 at a CAGR of 3.8% in the 2021-2028 period. The sudden rise in CAGR is attributable to this market’s demand and growth, returning to pre-pandemic levels once the pandemic is over.
The global market is majorly propelled by consumers' increasing shift toward luxurious and premium chocolates and gums. The growing affordability of consumers is resulting in their indulgent buying behavior to pay for their desires. The demand for dark premium chocolates is growing across the developed countries and is projected to positively impact the overall growth of the confectionery items market.
Disruptions in Supply Chain and Workforce Shortage to Dampen Growth amidst COVID-19
The global COVID-19 pandemic has negatively impacted the global economy and food industry as governments imposed strict lockdowns and restricted public mobility. The closure of sugar and chocolate products manufacturing facilities significantly affected commodity production in the initial months. For instance, in the U.S., The Hershey Company temporarily closed all its production facilities from 16-29th March 2020 in response to the COVID-19 outbreak. Disruptions in the supply chain, workforce shortages, trade restrictions, and fluctuations in transportation and logistics were some of the problems observed during the lockdown. According to the CEO of the National Confectioners’ Association (NCA), the consumers during the quarantine period were eating more meals at home, lowered their store visits, and increasing their comfort levels with online purchasing affected the retail confectionery sector.
However, with the manufacturing facilities re-opening in various economies and the market players working towards reinstating the supply chain disruptions, it is anticipated to improve the market situation. As sugar and chocolate items are considered comfort food and consumers find unique ways to celebrate with more at-home activities such as baking, it is expected to impact the market positively.
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Growing Consumers’ Inclination Towards Organic Chocolates & Candies to Fuel Growth
The demand for healthier snacking and the taste and sensory benefits are increasing among the consumers, which has led to the popularity of organic snacks and sugar and chocolate products. Consumers have a mounting interest in organic products, which opens up many opportunities in the sector. The organic chocolate segment is witnessing decent growth globally and is gaining massive popularity among consumers. The reinforced efforts from manufacturers to meet the growing demand for organic chocolate in the market are assuring the global market's growth over the coming future.
Rising Emergence of On-the-go Snacks to Push Confectionery Businesss
Increasing modernization and a hectic combination of professional & personal obligations are some of the major factors triggering convenience snacks' demand as part of the daily diet. Consumers' busy lives disallow them to spend time cooking and dine-out during their working hours, which leads consumers to look for easy and quick-to-eat food products.
The number of consumers in the workplace is increasing nowadays, and it is becoming even harder to maintain a healthy work-life balance for them. Thus, manufacturers and marketers are intensively capitalizing on introducing and promoting a range of chocolate snacks such as on-the-go snacks, chocolate bars, and others to offer a healthy diet to consumers. They also focus on offerings of convenient and small packs that allow consumers to carry candies and bars in their bags. Dark chocolate is witnessing a rise in its popularity due to the health benefits associated with it.
For example, it is a rich source of antioxidants that improves insulin sensitivity and reduces blood pressure. Hence, the rising association of chocolates with youngsters and other working populations across the world is expected to propel the confectionery market growth during the forecast period.
Increasing Demand for Sugar-free Chocolates to Proliferate Market Sales
Improving consumers' lifestyles across the globe is also undergoing a sea change, especially their daily diet and health. Due to these changes, several lifestyle diseases have spurred, such as diabetes, blood pressure, etc. Obesity, overweight, and their related diseases are becoming a serious concern among consumers posing major challenges for the sustainability of healthcare systems across the world. Consumers are increasingly shifting their preferences towards low-calorie and sugar-free food products to eliminate such diseases. The growing health concerns have led to reduced sugar intake among consumers. Thus, the demand for sugar-free chocolates was growing and anticipated to grow further in the upcoming years.
Fluctuations in the Price of Raw Materials to Hamper Market Performance
Cocoa and sugar are essential raw materials that are majorly utilized to produce confectioneries across the globe. The price of sugar and cocoa has witnessed fluctuations in the past few years as their production and demand vary swiftly in the global marketplace. The cocoa and sugar yields get affected due to unfavorable weather conditions, crop diseases, labor availability, stock ratios, and other economic factors that hamper the smooth flow of their demand and supply in the market. As a result, the raw materials' average annual price fluctuates from low to high and results in the surplus or understock to produce sugar and chocolate products in the market. Hence, price fluctuations of raw materials are expected to dampen the overall demand in the upcoming years.
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Sugar & Gums to Hold Major Share Due to its Growing Popularity among the Candy Manufacturers
The global market is growing at a decent pace owing to the emerging acceptance and indulgence of chocolates and chocolate snacks among consumers in developed regions such as North America & Europe. However, the chocolate confectionery segment is the leading segment globally and shows immense growth in developing economies. Rising disposable income and steady growth of the developing economies are some of the major factors eliciting demand for varied chocolates in the global marketplace. Higher acceptance of westernized food and the consumers' daily routine has created vast opportunities for chocolate items manufacturers worldwide.
On the other hand, sugar and gum confectioneries are also performing well in the overall market. Rising demand for innovative candies, snack bars, and other inventive stuff among children, youngsters, and the working population has encouraged manufacturers to broaden their production and distribution capacity in overseas markets. The introduction of new products with advancements in flavors and textures has resulted in the increased retail penetration of sugar confectioneries in the market.
Mass Merchandisers to be the Leading Sales Channel Owing to its Convenient Offerings
Supermarkets/hypermarkets are gaining a tremendous response from consumers across the world. The increasing dependence of consumers over these facilities, freedom of selection, more comprehensive product ranges, and bundling schemes offered by the mass merchandisers have led to the increased foot-counts on the floor. Consumers prefer mass purchasing of groceries for a particular period of time due to their busy and hectic schedules. Thus, supermarkets/hypermarkets offer a convenient buying experience to the consumers under a single roof. The separate sections in the supermarkets/hypermarkets provide an easy way to buy chocolates and other confectioneries.
The rapid emergence of such sales counters worldwide is expected to contribute to the revenue generation of sugar and chocolate products in the global marketplace. However, the manufacturers are also focussing on small and consumer packs for the middle-class population globally, promoting the sales of confectioneries from convenience, online, and departmental stores.
Europe Confectionery Market Size, 2020 (USD Billion)
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Europe accounted for the major share in the global market and accounted for USD 73.41 billion in 2020. The consumers are intensively looking for quality and premium chocolates over the sugar confectionery products, owing to their increased taste preferences and permissive eating habits. The combination of work-life, health concerns and individual desires among the consumers is one of the major factors that are becoming influential motivators to consume confectioneries in their daily routine.
The consumers are demanding some specific and customized chocolates in the market, such as ‘melt-in-the-mouth ‘feel chocolate, ‘quality-for-chocolate’, and others which have consequently led to greater sales of confectioneries in the region. It is the most popular snack-type in certain European countries, including the U.K., Germany, and Austria. These countries are expected to consume 5 times the global average.
Asia Pacific held the second largest confectionery market share and holds immense potential for chocolate product consumption worldwide. Rapid urbanization, increasing disposable income, young and dynamic population, and easy availability of confectioneries in consumer packs are the major reasons for the regional market's growth. The manufacturers are utilizing such opportunities by intensively capitalizing on facility expansions and mergers & acquisitions with regional players. Increasing popularity, acceptance, and technological advancements for such products among consumers are anticipated to be the significant factors fostering the growth of the overall market during the forecast period.
North America is witnessing a significant rise in sugar and chocolate product sales as consumers are increasingly eyeing it as comfort food. The between-meal snacking trend in the region has led to increased demand for snacks and cereal bars. The U.S. is one of the major markets where the consumers are ready to spend on artisanal confectionery products that enhance their appearance and increase their palatability. Increased efforts from manufacturers, implementation of new technologies, and emerging production facilities in the region have positively impacted the overall growth of the demand.
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On the other hand, there is a slow growth observed throughout the forecast period in South America, which is owing to factors such as low economic condition, consumer health concern, and certain legislative challenges. However, the region is expected to show a high preference for chocolate over sugar as it is perceived to be premium.
Prominent Players Focusing on Strengthening Distribution Network to Fortify Market Presence
The confectionery items market structure is highly consolidated due to the dominance of some key giants and their presence in the market. The manufacturers are intensively capitalizing on reinforcing their distribution networks, implementing cost reduction techniques, and placement of varied products in the global marketplace. Barry Callebaut, Ferrero SpA, and Nestle S.A. are some of the major companies that hold the major share in this market.
An Infographic Representation of Confectionery Market
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The global market research report provides qualitative and quantitative insights into the market. It also offers a detailed analysis of the market size and growth rate for all the segments. Various key insights presented in the report are an overview of related markets, competitive landscape, recent industry developments such as mergers & acquisitions, the regulatory scenario in critical countries, and key confectionery market trends.
Value (USD Billion)
By Distribution Channel
Fortune Business Insights says that, the market size stood at USD 188.52 billion in 2020 and is projected to reach USD 242.53 billion by 2028.
Growing at a CAGR of 3.8%, the market will exhibit steady growth during the forecast period (2021-2028).
Chocolate segment is expected to be the leading segment based on type in the global market during the forecast period.
Increasing consumer shift towards confectionery snacks is driving the growth of the market.
Barry Callebaut, Ferrero SpA, and Nestle S.A. are a few of the key players in the market.
Europe is expected to hold the highest market share in 2020.
Supermarkets/Hypermarkets are expected to grow at the fastest pace during the forecast period.
Growing demand for sugar-free chocolates among consumers is one of the major growth in the global marketplace.
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