Sweet Spread Market - Growth, Trends, COVID-19 Impact, and Forecasts (2023 - 2028)

Sweet Spread Market - Growth, Trends, COVID-19 Impact, and Forecasts (2023 - 2028)

The Sweet Spread Market is projected to register a CAGR of 3.2% during the forecast period.

The growth of the sweet spread market can be attributed to the rising popularity of quick and healthy morning meal replacements among office-goers and the youth population. Manufacturers emphasize introducing new spreads with health benefits and distinctive flavor characteristics to excite consumers and attain a share of the sweet spread market. Spreads made from natural ingredients, i.e., free from additives (like artificial sweeteners, pectin, and gelling agents), and spreads with nutritional claims, are expected to grow in the coming years. Consumers have been looking for low-sugar and low-fat alternatives, especially in the form of natural/organic spreads with functional attributes.

The renowned hazelnut spread Nutella is manufactured annually in more than 1.35 million pounds worldwide. In addition, over 250,000 tons of Nutella are sold annually in more than 75 countries. According to statistics from Ferrero company, France is considered to be one of the largest consumers of Nutella, with an approximate share of 25% of the world's production and consumption every year. Moreover, ethical concerns are also having an increasing impact on the development of new products in the sweet spreads market. Eco-friendly packaging has been a primary focus, but fair-trade lines and the use of ingredients from sustainable agriculture are emerging. The spreads are now widely available in mainstream supermarkets and are no longer restricted to health food stores.

However, with so many spreads consumed for breakfast, any change in consumer breakfast habits can have an impact on sales. Many consumers are skipping breakfast altogether due to their increasingly hectic schedules, while others prefer the convenience of grab-and-go options like cereal bars.

The majority of consumers in developed countries are looking for food spreads without any inclusion of artificial additives owing to the associated long-term adverse health effects. Manufacturers are inclined toward the usage of natural flavoring agents, preservatives, and sweeteners as they are the key ingredients used in sweet spreads to extend the shelf-life of the product. Global manufacturers have introduced product lines with natural claims across spreads/buttery spreads with no artificial preservatives and artificial flavor. Additionally, millennials currently account for a large share of direct consumer spending. This generation of individuals insists on consuming better-for-you products than natural or organic ingredients. Thus, the vendors are creating strategies for this demand and are developing organic offerings. For instance, Trailblazer offers several product lines, such as Organic Preserves, which contain more fruit and less added sugar than regular preserves.

Natural/organic sweet spreads have grown in popularity as a result of health concerns, and they benefit from the overall growth of the American organic market. Even when economic conditions are unfavorable, the majority of consumers who prefer organic products will not change their shopping habits or refrain from purchasing organic goods. For instance, in October 2022, Dabur India Ltd introduced the Réal Health Peanut Butter range. As per the company's claims, the product is 100% natural and is made with a single ingredient, a bold variety of peanuts. The product is a source of antioxidants, gluten-free, and has no trans fats. Additionally, the product has no added sugar, salt & oil and can be purchased from e-commerce and modern trade.

The sweet spread market in the North American region is dominated by increased consumption of spreads in countries, particularly, the United States and Canada. The sweet spread market is highly competitive with private-label products competing with global prominent brands, in terms of pricing and product innovation. Chocolate-based spread segment of the market is witnessing a growth in demand, specifically among parents who are concerned about their children getting regular breakfast as per their tastes and preferences.

The increasing trend for sanctification is fueling the growth of the chocolate-based spreads market during the forecast period. The availability of regional products at a convenient price is creating competition in the market. For instance, in July 2022, SunButter a brand of SunGold Foods, Inc. announced a national-roll out of its chocolate SunButter on Amazon and 450 outlets of Whole Food Market across the United States market. Additionally, according to USDA statistics, 1.48 million pounds of raw honey were produced by 2.71 million bee colonies in 2020. The National Honey Board estimates that the average American consumes about 1.51 pounds of honey annually.

J.M. Smucker, Kraft Foods, Ferrero SpA, and ConAgra Foods Inc. are the key players in the sweet spread market. Expansion of their facilities and product portfolio is the major strategy of these companies. Companies are focussing on producing healthy and innovative products, which is encouraging sweet spread manufacturers to manufacture quality products, as well. Owing to the high consumption of sweet spread products in the global market, new product launch with varied taste, flavor, and combination is adopted by leading companies. For instance, in June 2022, Challenge Butter, a US farmer-owned butter brand, launched snack spreads. The company claims that it is made with real butter and no added artificial flavors, which are available in dessert and seasoned varieties such as Salted Caramel Dessert Snack Spread, Chocolate Dessert Snack Spread, Vanilla Fudge Dessert Snack Spread, Everything Seasoned Snack Spread, Garlic Parmesan, Buffalo Seasoned Snack Spread, and Herb Seasoned Snack Spread.

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