Asia is set to dominate growth in the global grocery market for the next five years, according to a report by international research organisation IGD. Worldwide, grocery industry sales are tipped to grow by US$2.7 trillion in sales up to 2022.
“Asia’s grocery retail market will be significantly boosted by a rising population and increased shopper spend, with consumer spending in the region accounting for nearly half of additional sales generated to 2022,” IGD said in a report. Of that, $1.2 trillion will come from Asia, representing a compound annual growth rate (CAGR) of 6.6 per cent.
Inflation, population growth and increased consumer spending on grocery products will all drive the market’s increase. On predicted 2022 values, China will be the world’s second largest grocery market worth 1.671 trillion, with 5.8 per cent CAGR growth, snapping at the heels of the US, tipped to be worth $1.722 trillion, but posting a more modest growth rate of 3.6 per cent.
Of the top 20 markets in the world, the fastest growing will be Turkey and Nigeria at 11.7 per cent, followed by India on 11.2 per cent, the Philippines and Pakistan, both on 9.1 per cent, and Indonesia on 7.5 per cent. Jon Wright, head of retail insight with IGD, said the burgeoning market represents excellent opportunities for retailers and manufacturers.
“The most attractive and sustainable growth opportunities are in markets where sales increase will be due to population growth or consumers spending more money – for example, Asia, Latin America and North America.
“With China, India and Japan all in our top five, Asia’s grocery market continues to be in rude health thanks to growing populations and shoppers with more disposable income. Innovations in this market also continue apace, especially in China, where retailers are experimenting to drive the online and convenience channels,” said Wright.
This story was first published by Inside Retail Asia.
