According to the study, ’THE BABY FOOD SECTOR IN HUNGARY, 2018’, baby food includes different types of products and hence, was recently affected by several factors and trends. Some consumers have rejected milk formula products and opted for breast feeding instead while others have started making their own baby food at home but those with busy lifestyles continue to rely on products sold in the market. The food and beverage industry is one of the most important sectors of the Hungarian economy. It is the second largest employer and the third largest producer in the manufacturing sector accounting for more than one-tenth the industrial output.
The baby food sales in Hungary were hit by a decline in the number of births and a poor economy but the scenario started changing in 2014. Today, the country’s baby food sector is doing pretty well especially the wet meals sector which accounts for more than half of the baby foods market. Milks account for nearly one-third market share whereas cereals are still an underdeveloped sector in the country. Cereals, wet meals and drinks are now largely sold in food outlets and drugstores. The former accounts for three-fourth of the sales while the latter for the remainder portion.
A popular baby food is formula milk which is usually made from cows’ milk that has been treated to make it more suitable for consumption by babies and comes in the forms of a dry powder and a liquid, the latter of which is ready-to -use unlike the former which needs to be mixed with water. This industry is currently valued at tens of billions of US dollars globally and is one of the largest sectors in health and wellness packaged foods. Despite globally declining birth rates and the promotion of breastfeeding, the factor that fuels this industry is the increasing employment of women. There are a number of companies that retail such products with their own specializations. HiPP Organic has been incorporating organic ingredients in their products for decades and now has a range of items such as meals, drinks and cereals that are all highly regarded.
The scenario in the Hungarian baby food sector continues to be dominated by Numil Hungary. It remained the country’s largest player in baby food in 2017. The company has a large product portfolio and is thus, present in most of the categories within baby food in Hungary, from dried baby food to prepared baby food as well as milk formula. The company’s dominance is clear by the fact that it held nearly one-third market share in 2017. Nestle Hungaria follows next with a wide range of products and is renowned for being innovative in its approach. Local manufacturer Univer is also a notable player in the field. Foreign manufacturers also pose serious competition. These include HiPP Organic which is a German company known for its reliable nutritious organic baby food and is believed to be Europe’s most renowned along with Spanish Danone which is also a big player. The former leads the wet meals and drinks categories while the latter is the clear leader in milks and cereals.
The Hungarian market for baby food is expected to be mainly driven by the demand for convenience products which is foreseen to be stable. Sales of dried baby foods, prepared baby foods and other forms are being observed to be greatly influenced by lifestyle trends. However, in coming times this could have the opposite effect since health conscious mothers are now beginning to adopt alternate measures. Hungary has one of the lowest birth rates in Europe yet the globally increasing demand for convenience products is said to influence the trend of milk formula in the country.
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Ankur Gupta, Head Marketing & Communications