The future of the domestic confectionery market is positive, reported the Business Monitor International (BMI).
Accordingto the BMI Vietnam Food and Drink report for the second quarter 2014,the local confectionery revenue is expected to gain a year-on-yearincrease of 10.65 percent to 27.27 trillion VND (1.3 billion USD) forthis year.
A year-on-year surge between 9.3 percent and 10.6percent has been forecast for the revenue from 2015 to 2018. That wouldbring in between 30.15 trillion VND (1.4 billion USD) and 39.88 trillionVND (1.9 billion USD).
"The long-term outlook for the Vietnamese confectionery market is positive," said BMI.
Factorssuch as rising purchasing power, favourable demographics, growinghealth awareness and continued investments in the sector will supportconfectionery demand, especially with regard to chocolates, it said.
Itsaid local chocolate revenues are expected to gain a year-on-yearincrease of 11.88 percent to 4.54 trillion VND (215.2 million USD) forthis year.
The revenue is forecast to have a year-on-year surgeof 12 to 13 percent for each year from 2015 to 2018, which is 5 to 7.3trillion VND (237-346 million USD).
More personal wealth islikely to translate into a greater discretionary appetite for premiumconfectionery products. As an increasing number of domesticconfectioners expand their upmarket product ranges, it is likely tobolster value sales growth over the coming years.
The BMI said51.9 percent of the Vietnamese population is estimated to be youngerthan 30, and the maturing of this demographic group means that there aredynamic opportunities in the mass market. Moreover, this demographicgroup is generally more receptive to Western cultures and will give animpetus to confectionery products.
Health awareness is prompting shifts of consumption habits towards functional and healthy confectionery products.
Capitalisingon the growing trend, domestic confectioners such as Tan Tan Food &Foodstuff and Vina Mit are expanding their functional productofferings.
Regarding investments in the local confectionerysector, BMI said sustained competition levels in the Vietnameseconfectionery sector have ensured that dynamism in the market isunlikely to cool off any time soon.
Nabati Indonesia, a leadingIndonesian biscuit producer, recently announced plans to startdistribution of its biscuit products in Vietnam - a testament to theattractiveness of the sector. Meanwhile, domestic confectioners such asKinh Do are expected to continue to invest in broadening their productranges and expanding their distribution channels.
"Investment inVietnam's ingredients sector chimes with our favourable outlook for thecountry's food and drink market," the BMI said.
Belgianingredients firm Puratos, which manufactures products for the baking andconfectionery sector, announced in autumn 2012 that it will team upwith fellow Belgian firm Grand-Place Holding, which produces chocolateingredients, to set up a joint venture in Vietnam.
The two firmswill hold a respective 70-30 stake in the new venture and will invest 10million USD in the operation over the next five years.
As ofnow, domestic confectionery firms hold 70 percent of the local marketshares. These include Kinh Do, Hai Ha and Bibica along with North KinhDo, Huu Nghi, Pham Nguyen, Duc Phat and other small private producers.Meanwhile, imported confectionery products have accounted for 30 percentof the local market.-VNA
Accordingto the BMI Vietnam Food and Drink report for the second quarter 2014,the local confectionery revenue is expected to gain a year-on-yearincrease of 10.65 percent to 27.27 trillion VND (1.3 billion USD) forthis year.
A year-on-year surge between 9.3 percent and 10.6percent has been forecast for the revenue from 2015 to 2018. That wouldbring in between 30.15 trillion VND (1.4 billion USD) and 39.88 trillionVND (1.9 billion USD).
"The long-term outlook for the Vietnamese confectionery market is positive," said BMI.
Factorssuch as rising purchasing power, favourable demographics, growinghealth awareness and continued investments in the sector will supportconfectionery demand, especially with regard to chocolates, it said.
Itsaid local chocolate revenues are expected to gain a year-on-yearincrease of 11.88 percent to 4.54 trillion VND (215.2 million USD) forthis year.
The revenue is forecast to have a year-on-year surgeof 12 to 13 percent for each year from 2015 to 2018, which is 5 to 7.3trillion VND (237-346 million USD).
More personal wealth islikely to translate into a greater discretionary appetite for premiumconfectionery products. As an increasing number of domesticconfectioners expand their upmarket product ranges, it is likely tobolster value sales growth over the coming years.
The BMI said51.9 percent of the Vietnamese population is estimated to be youngerthan 30, and the maturing of this demographic group means that there aredynamic opportunities in the mass market. Moreover, this demographicgroup is generally more receptive to Western cultures and will give animpetus to confectionery products.
Health awareness is prompting shifts of consumption habits towards functional and healthy confectionery products.
Capitalisingon the growing trend, domestic confectioners such as Tan Tan Food &Foodstuff and Vina Mit are expanding their functional productofferings.
Regarding investments in the local confectionerysector, BMI said sustained competition levels in the Vietnameseconfectionery sector have ensured that dynamism in the market isunlikely to cool off any time soon.
Nabati Indonesia, a leadingIndonesian biscuit producer, recently announced plans to startdistribution of its biscuit products in Vietnam - a testament to theattractiveness of the sector. Meanwhile, domestic confectioners such asKinh Do are expected to continue to invest in broadening their productranges and expanding their distribution channels.
"Investment inVietnam's ingredients sector chimes with our favourable outlook for thecountry's food and drink market," the BMI said.
Belgianingredients firm Puratos, which manufactures products for the baking andconfectionery sector, announced in autumn 2012 that it will team upwith fellow Belgian firm Grand-Place Holding, which produces chocolateingredients, to set up a joint venture in Vietnam.
The two firmswill hold a respective 70-30 stake in the new venture and will invest 10million USD in the operation over the next five years.
As ofnow, domestic confectionery firms hold 70 percent of the local marketshares. These include Kinh Do, Hai Ha and Bibica along with North KinhDo, Huu Nghi, Pham Nguyen, Duc Phat and other small private producers.Meanwhile, imported confectionery products have accounted for 30 percentof the local market.-VNA
