Food makers to cash in on Chinese and Indian food trends

By staff reporter

- Last updated on GMT

Related tags: Food, United kingdom

Food makers must leap into ethnic food development to ensure they
cash in on the burgeoning European market for packaged ethnic foods
predicted to hit €7 billion in Europe by 2009 on double digit

The UK still leads the ethnic foods market, but a new report from Datamonitor claims that the British love affair with ethnic food is now spreading across Europe, with overall growth pitching at 12 per cent.

In Spain alone, the value of packaged ethnic foods is expected to treble by 2009, from €134 in 2004 to €474 in 2009.

"As people demand better-tasting, stronger-flavoured and more authentic food, they are stepping up their consumption of Chinese, Mexican and Indian meals, both pre-packaged and homemade,"​ says John Band, consumer markets analyst at Datamonitor​.

Ethnic packaged food products currently make up only 0.9 per cent (€3.9bn) of Europe's €450 billion packaged food market.

But although it is a far smaller market than in the US, in the last five years the market witnessed "enormous growth which eclipses that of the US."

Average annual growth in consumer spending on ethnic packaged foods in Europe has been running at a 14 per cent since 1999 - a rate far higher than 5 per cent in the US.

Datamonitor predicts the ethnic packaged food market in Europe will grow to 1.4 per cent share of total food sales in the next four years.

The UK accounts for over half the total European packaged ethnic food market and is the only European country where ethnic packaged foods currently account for over one per cent share of overall European retail packaged food sales.

Datamonitor expects this to increase to almost 4 per cent in 2009, when UK spend on ethnic packaged food will total 3.4bn compared to 2.1bn today.

And of no surprise, the analysts predict that dynamic growth will be lead by the UK, with the average Brit now spending £35 a year on ethnic food for home consumption.

"This partly reflects the UK's high ethnic minority population, but this is not the whole story: France's ethnic minority population is not far below the UK's, but its €412m ethnic food market is less than one-fifth the size of the UK market,"​ says the report.

The fastest growth in ethnic packaged foods will be seen in Spain, predicted to more than treble from €134m to €474m in 2009. Italy will also see strong growth, 26.5 per cent to 2009, with France and The Netherlands showing 11.8 and 11.9 per cent respectively.

Leading ethnic cuisines​ Food formulators could delve deeper into Chinese offerings, with the report showing that Chinese food is the leading pre-packaged ethnic cuisine, popular across all of Europe, even where Chinese immigration is relatively low.

"This reflects Chinese food's relative ease of consumption: it is not heavily spiced and it often features familiar ingredients,"​ comments Band.

Indian food is the second most popular, driven largely by its enormous popularity in the UK. Chinese food accounts for 39 per cent of European ethnic food consumption, while Indian food accounts for 28 per cent, and Mexican food accounts for another 20 per cent.

There is a major difference between countries: in the UK, Indian food accounts for 43 per cent of the market, but it accounts for less than 10 per cent in every other European country.

In all Europe with the exception of the UK, Mexican food is the second most popular ethnic cuisine, reflecting its accessibility and its popularity in the US (and its associations with the US), despite the extremely low proportion of Mexican immigrants in Europe, claims the report.

Even in the UK, Mexican food is increasingly popular, with sales tipping the €294 million mark in 2004.

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