Free From in Singapore Euromonitor International April 2019 FREE FROM IN SINGAPO RE P a s s p o r t I LIST OF CONTENTS AND TABLES Headlines ..................................................................................................................................... 1 Prospects ..................................................................................................................................... 1 Free From Meat Products Here To Stay ................................................................................... 1 Industry Players Invest in A Variety of Meat Substitutes, Including Fungi ................................ 1 Allergens Are the Main Factors for Avoidance Among Singaporeans ...................................... 1 Competitive Landscape ................................................................................................................ 2 Domestic Players Lead in Several Free From Categories ........................................................ 2 the Majority of Innovations Focus on Minimising Allergic Reactions ......................................... 2 Free From Gluten Benefits From New Product Development ................................................... 2 Category Data .............................................................................................................................. 2 Table 1 Sales of Free From by Category: Value 2013-2018 ..................................... 2 Table 2 Sales of Free From by Category: % Value Growth 2013-2018 .................... 3 Table 3 NBO Company Shares of Free From: % Value 2014-2018 .......................... 4 Table 4 LBN Brand Shares of Free From: % Value 2015-2018 ................................ 5 Table 5 Distribution of Free From by Format: % Value 2013-2018 ........................... 6 Table 6 Forecast Sales of Free From by Category: Value 2018-2023 ...................... 6 Table 7 Forecast Sales of Free From by Category: % Value Growth 2018- 2023 ............................................................................................................. 7 © Euromonitor International FREE FROM IN SINGAPO RE P a s s p o r t 1 FREE FROM IN SINGAPORE HEADLINES . Free from packaged food registers 4% current retail value growth in 2018 to reach SGD146 million . Free from meat products remains the largest category in 2018, accounting for 62% of value sales . Free from allergens records the highest retail value sales growth of 9% in 2018 . Fortune Food leads the free from category in 2018 with a 24% value share . Sales of free from packaged food are expected to rise at a 4% current retail value CAGR (2% 2018 constant retail value CAGR) over the forecast period to reach SGD180 million in 2023 PROSPECTS Free From Meat Products Here To Stay As consumers are increasingly seeking a healthier and more environmentally sustainable lifestyle, vegetarianism and veganism are gaining popularity, stimulated by wider menu choices. A number of specialist vegan outlets have entered Singapore, such as VeganBurg, while regular foodservice outlets are also increasingly innovating menus using plant-based meat-substitutes. For instance the chicken fast food chain, 4Fingers, recently launched a meat free chicken range. This local fast food chain is collaborating with giant vegan manufacturer, Quorn. Although originating from a smaller base, demand for free from meat products is continuously growing as demonstrated in the higher value sales achieved by providers of vegan products. This lifestyle is also gaining popularity among non-vegans for various reasons, including health and environmental-friendliness, leading manufacturers to target this meat-loving consumer group through free from meat substitutes. Industry Players Invest in A Variety of Meat Substitutes, Including Fungi Traditionally, free from meat analogues are mainly produced from soy protein and filled with gluten. However, over the review period, many new innovations included meat substitutes made from other plant products, such as a variety of fungi. Over the review period, free from meat meat substitutes is expected to be characterised by both local and global brands such as Fortune in chilled meat substitutes and Amy’s Kitchen in frozen meat substitutes. The entry of the world leader of free from meat products, Quorn, to Singapore in 2017, further provides competition and varieties for vegans in Singapore. Such developments will enable consumers to use ready to eat or ready to cook meat substitutes and experience a vegan lifestyle while meeting their nutritional requirements. Allergens Are the Main Factors for Avoidance Among Singaporeans In addition to pursuit of healthy lifestyles, consumers are becoming increasingly knowledgeable about free from allergen food options, especially around food sensitivities that may cause allergic reactions such as rashes or digestive disorders. Over the forecast period, free from dairy is set to enjoy strong growth especially with the growth of plant-based dairy alternatives and soy milk consumption. As consumers become increasingly concerned about lactose intolerance, they are switching their dairy consumption to free from dairy alternatives. © Euromonitor International FREE FROM IN SINGAPO RE P a s s p o r t 2 There is also a growing group of consumers who do not have dietary issues with dairy products but who are choosing to consume free from dairy alternatives as they perceive these products to be better for them and easier to digest. COMPETITIVE LANDSCAPE Domestic Players Lead in Several Free From Categories Domestic players lead in several free from categories, namely free from dairy and free from meat chilled meat substitutes. F&N Foods led free from dairy in 2018 with its leading Nutrisoy brand, while Fortune Food led in the free from meat chilled meat substitutes category with its Fortune tofu brand. Their leadership can be attributed to their long establishment in Singapore, as well as regular promotional campaigns and offers. the Majority of Innovations Focus on Minimising Allergic Reactions As consumers have become more knowledgeable about food sensitivities that may trigger allergic reactions, there is a growing interest in products that eliminate their exposure to these ingredients. For instance, consumer interest in lactose intolerance among Asians has led to growth in free from dairy products. However, although soy-based substitutes have been traditionally popular, soybeans can also cause some consumers to have an allergic reaction. Hence, manufacturers are innovating and producing free from dairy products from other plant- based ingredients such as oats, rice, and almonds. Free From Gluten Benefits From New Product Development Similar to the trend in free from dairy, free from gluten is also growing. Besides the traditional free from gluten options in baked goods, players are also stimulating category growth by innovating free from gluten products in various other categories. For instance, dried pasta witnessed the release of free from gluten pasta by San Remo and Lam Soon Group. This step has also been taken by global manufacturer, Nestlé Singapore through innovation in free from gluten breakfast cereals such as its launch of free from gluten cornflakes. Over the forecast period, the innovation trend will continue to focus on health improvement and disease prevention leading to innovation in more free from products in line with consumer demand. Furthermore, with more foodservice outlets providing free from gluten menus, especially in the form of artisanal baked goods, more free from gluten packaged food products are expected to become popular. CATEGORY DATA Table 1 Sales of Free From by Category: Value 2013-2018 SGD million 2013 2014 2015 2016 2017 2018 Free From Allergens 15.0 18.1 20.1 22.5 24.8 27.0 - HA Milk Formula 15.0 18.1 20.1 22.5 24.8 27.0 -- HA Liquid Milk Formula - - - - - - -- HA Powder Milk Formula 15.0 18.1 20.1 22.5 24.8 27.0 Free From Dairy 15.3 15.9 16.6 16.9 17.0 17.2 - Free From Dairy Ice - - - - - - Cream © Euromonitor International FREE FROM IN SINGAPO RE P a s s p o r t 3 - Free from Dairy Milk 14.3 14.9 15.5 15.8 15.9 16.1 - Free from Dairy Yoghurt 1.0 1.0 1.1 1.1 1.1 1.1 Free From Gluten - - - - - - - Free From Gluten Baby - - - - - - Food -- Free From Gluten - - - - - - Dried Baby Food -- Free From Gluten - - - - - - Other Baby Food -- Free From Gluten - - - - - - Prepared Baby Food - Free From Gluten - - - - - - Baked Goods -- Free From Gluten Bread - - - - - - -- Free From Gluten Cakes - - - - - - - Free From Gluten - - - - - - Breakfast Cereals - Free From Gluten Pasta - - - - - - - Free From Gluten - - - - - - Ready Meals - Free From Gluten - - - - - - Sweet Biscuits Free From Lactose 8.0 8.7 9.4 10.1 10.7 11.5 - Free From Lactose 8.0 8.7 9.4 10.1 10.7 11.5 Baby Food -- Free From Lactose 8.0 8.7 9.4 10.1 10.7 11.5 Special Baby Milk Formula - Free From Lactose Dairy - - - - - - -- Free From Lactose - - - - - - Butter and Spreads -- Free From Lactose - - - - - - Cheese -- Free From Lactose Milk - - - - - - -- Free From Lactose - - - - - - Yoghurt Free From Meat 78.4 80.5 82.7 85.1 87.7 90.4 - Free From Meat Meat 78.4 80.5 82.7 85.1 87.7 90.4 Substitutes -- Free From Meat 78.2 80.3 82.5 84.9 87.5 90.2 Chilled Meat Substitutes -- Free From Meat 0.2 0.2 0.2 0.2 0.2 0.2 Frozen Meat Substitutes -- Free From Meat Shelf - - - - - - Stable Meat Substitutes - Free from Meat Ready - - - - - - Meals -- Free From Meat Soy- - - - - - - based Ready Meals -- Free From Meat Other - - - - - - Ready Meals