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The Baby Food Market in the US 2017

The Baby Food Market in the US 2017

Summary

The Baby Food Market in the US 2017, is an analytical report by GlobalData which provides extensive and highly detailed current and future market trends in the US market.

Many parents have put off raising children, and the number of births has fallen unremittingly to million in 2016. Growing demand for organic and non-GMO indicates that parents with sufficient income are prepared to spend it on food perceived as more beneficial for their babies. Consumption has fallen partly as a result of a lower number of births, and, in the case of baby milks, partly due to higher levels of breastfeeding. The infant formula market is distorted by the Federal WIC program. Growth in newer segments - particularly pouches, snacks and toddler milks - has prevented even more serious declines. Forecasts for the US economy are currently relatively positive. Coupled with the forecast increase in births from 2018 onwards, this is likely to lead to a more buoyant market.

What else does this report offer?

  • Consumption data based upon a unique combination of industry research, fieldwork, market sizing work and our in-house expertise to offer extensive data about the trends and dynamics affecting the industry.
  • Detailed profile of the companies operating and new companies considering entry in the industry along with their key focus product sectors.
  • Market profile of the various product sectors with the key features & developments, segmentation, per capita trends and the various manufacturers & brands.
  • Overview of baby food retailing with a mention of the major retailers in the country along with the distribution channel.
  • Future projections considering various trends which are likely to affect the industry.
Scope
  • Living standards in the US are among the highest in the world. However, many parents have put off raising children, and the number of births fell unremittingly to million in 2016.
  • In 2016, sales of baby food amounted to tons, 16% less than in 2010. Consumption has fallen partly as a result of a lower number of births, and, in the case of baby milks, partly due to higher levels of breastfeeding.
  • Milks account for almost three-quarters of the value of retail sales and wet meals for 22%. The share of milks has declined over the last six years. Wet meals on the other hand have taken a larger share of spending, rising to 22.1% in 2016, compared with 16.9% in 2010.
  • The country is a major exporter, especially of milks and cereals, with volumes reaching tons in 2015, while a further tons of other baby foods is exported.
  • Supermarkets dominate sales of baby food, accounting for some two-thirds of infant formula sales and 60% of other baby food.
  • GlobalData estimates that the market will begin to expand again, and will increase by 3.4% in volume between 2016 and 2022.
Reasons to buy
  • Evaluate important changes in consumer behavior and identify profitable markets and areas for product innovation.
  • Analyse current and forecast behavior trends in each category to identify the best opportunities to exploit.
  • Detailed understanding of consumption by individual product categories in order to align your sales and marketing efforts with the latest trends in the market.
  • Investigates which categories are performing the best and how this is changing market dynamics.


  • Introduction
    • Executive Summary
    • Definitions: Market Sectors
    • Definitions: Terminology
  • Background to the Market
    • Births — Live Birth Rates: Although 2014 saw a slight return to growth in the number of births, the downward trend has since resumed
      • Table Live Birth & Population Trends, 2006–2016
    • Births — Live Birth Rates: The smallest decline has been among white/Hispanic women, but the highest birth rates are among black/Asian & Pacific Islands women
      • Table Births & Birth Rates by Ethnic Origin, 2000–2015
    • Births — Live Births by Region: The majority of states have seen a fall in birth numbers, with declines particularly strong in New Mexico, Vermont, Connecticut, and Illinois
      • Table Births by State, 2010–2015
    • Births — Live Births by Region: The highest increase was in the state of North Dakota (+24%)
      • Table Births by State, 2010–2015 (Cont..)
    • The Consumer: Concerned parents are increasingly likely to choose organic products for their babies
    • Socio-demographic Trends — Family Structure: The majority of births (60% in 2015) occur to married couples, and the parents of 58% of births outside marriage cohabit
      • Table Trends in Marriages & Divorces, 2010–2014
    • Socio-demographic Trends — Births by Age of Mother: The average age of giving birth to a first child in the US rose to 26.4 years in 2015
      • Table Births by Age of Mother, 2013–2015
    • Socio-demographic Trends — Women of Childbearing Age: The number of women in the peak childbearing years rose strongly, up by 9.5% to 22.4 million in 2016
      • Table Number of Women of Childbearing Age, 2010 & 2016
    • Working Women — Female Employment: The proportion of women of working age who are in the labor force has declined slightly, from 58.6% in 2010 to 56.7% in 2016
      • Table Female Employment Trends, 2010–2017
    • Regulations: The US is not a signatory to the International Code of Marketing of Breast-milk Substitutes
    • Regulations: There are strict controls on the ingredients and manufacturing processes for infant formula
    • Regulations: Parental concern about the origin of the ingredients in their babies' food is increasing
    • Regulations: Recent surveys have raised further concerns about the quality of commercially produced baby foods
    • Breastfeeding Trends — Promotion: The government has a number of initiatives for the promotion and support of breastfeeding, through a variety of different agencies
    • Breastfeeding Trends — Promotion: An act to protect breastfeeding women's rights at the workplace has not been enacted
    • Breastfeeding Trends — Prevalence: The Healthy People 2020 breastfeeding initiation target has almost been met, but other targets still have some way to go
      • Table Breastfeeding Targets by 2020
    • Breastfeeding Trends — Prevalence: The proportion of babies being breastfed has increased significantly over the past 25 years, and continues to increase
      • Table Breastfeeding Rates, 1990–2015
    • Breastfeeding Trends — Prevalence: By 2015, 18 states had reached the 2020 81.9% target of ever breastfeeding
      • Table Breastfeeding Rates by State, 2015
    • Breastfeeding Trends — Prevalence: Only 12 states have so far reached the 2020 target for breastfeeding at six months
      • Table Breastfeeding Rates by State, 2015 (Cont...)
    • Breastfeeding Trends — Prevalence: Breastfeeding rates continue to be well below average in most of the southern states
      • Table Breastfeeding Rates by State, 2015 (Cont...)
    • Breastfeeding Trends — Prevalence: Above-average rates of breastfeeding occur among white mothers, older mothers, and college graduates
      • Table Breastfeeding Rates by Demographic Characteristics, at Birth and Six Months, %, 1996–2015
    • Breastfeeding Trends — Prevalence: Non-participants in the WIC program have significantly higher levels of breastfeeding at six months than WIC participants
      • Table Breastfeeding Rates by Demographic Characteristics, at Birth and 6 Months, %, 1996–2015 (Cont...)
    • Breastfeeding Trends — Duration: Exclusive breastfeeding rates at three months and at six months also show the same trends as initiation rates
      • Table Breastfeeding Rates by Demographic Characteristics, at 12 months and Exclusively, 2015
    • Breastfeeding Trends — Prevalence: Working full-time at three months post-partum decreased breastfeeding duration by an average of 6-8 weeks.
      • Table Breastfeeding Rates by Demographic Characteristics, at 12 months and Exclusively, 2015 (Cont....)
    • Breastfeeding Trends — Legislation: Since 2010 employers have been required to provide a suitable room for breastfeeding women to express milk
    • Breastfeeding Trends — Legislation: Every state now has some law related to breastfeeding but provisions vary widely
    • Breastfeeding Trends — Legislation: The vast majority of States have enacted a law allowing a mother to breastfeed in any public place where she has the right to be
      • Table Summary of Breastfeeding Legislation by State, 2016
    • Breastfeeding Trends — Legislation: Nonetheless, breastfeeding in public is viewed as indecent exposure in 19 States
      • Table Summary of Breastfeeding Legislation by State, 2016 (Cont....)
    • Breastfeeding Trends — Legislation: In 17 States, breastfeeding women are exempt from jury duty
      • Table Summary of Breastfeeding Legislation by State, 2016 (Cont...)
    • Breastfeeding Trends — Legislation: Half of US States require employers to accommodate breastfeeding women on their return to work
      • Table Summary of Breastfeeding Legislation by State, 2016 (Cont...)
    • Breastfeeding Trends — Legislation: Few states have their own breastfeeding promotion programs
      • Table Summary of Breastfeeding Legislation by State, 2016 (Cont...)
  • Market Overview
    • Market Overview: Overall consumption has tailed off as a result of falling birth rates and declining per capita intake levels
    • Market Overview: The market has been hard hit by a decline in the number of births, as well as by an adverse economic climate, with consumption dropping by 16%
      • Table Market Size, 2016, &Growth Rates, 2010–2016
    • Manufacturer Shares: The dominance of the milks sector within the baby food market has meant that milks manufacturers have historically led in overall terms
      • Table Baby Food: Manufacturer Shares, Value, %, 2010–2016
    • Manufacturer Shares: Abbott and Mead Johnson controlled almost 80% of the milks sector in 2016, but in all other sectors Nestlé's Gerber dominates
      • Table Baby Food: Manufacturer Shares by Sector, %, 2016
    • The Future: The forecast increase in births from 2018 onwards, and a relatively positive economic outlook, is likely to lead to a more buoyant market
      • Table Projected Market Size, 2022, &Growth Rates, 2016–2022
  • Sector Analysis
    • Sector Analysis: Baby Milks
    • Milks Sector Trends: Volume sales fell by 9.5% over the 2010–2016 period, with particularly large declines in 2010 and 2011
    • Milks Sector Trends: Price has become a growing issue in the market, while the WIC program is a major influence on sales
    • Milks Per Capita Trends: Per capita consumption of infant formula peaked at 52.5kg in 2008, but by 2016 consumption had fallen to 45.6kg
    • Milks Segmentation: Toddler milks have proved the only growth area in the last five years
    • Milks Segmentation: Powdered milks account for the vast majority of value sales and continue to increase their share
      • Table Infant Formula: Trends in Sector Segmentation, 2012–2015
      • Table Infant Formula: Sector Segmentation, 2015
    • Milks Segmentation: The bulk of the market is made up of modified cow's milk formula, and this segment has continued to grow
      • Table Baby Milks: Segmentation, Value, % 2010–2016
    • Milks Segmentation: Demand for organic products and products free from GMO ingredients is rising
    • Milks Segmentation: Premium-priced products typically retail at US$40-US$50 per kg
      • Table Powdered Baby Milks: Brand Price Positioning Analysis, 2017
    • Milks Segmentation: The cheapest products on the market retail at below US$22 per kg
      • Table Powder d Baby Milks: Brand Price Positioning Analysis, 2017 (Cont...)
    • Milks Segmentation: Ready-to-drink liquid milks mostly retail at US$8 per liter, with concentrated milks costing US$13 per liter
      • Table Baby Milks: Brand Price Positioning Analysis, Liquid, 2017
    • Milks Segmentation: Innovation in packaging has been used as a means to differentiate branded products from private labels
    • Milks Manufacturer Shares: The US market is dominated by two players: Abbott and Mead Johnson
      • Table Baby Milks: Manufacturer Shares, Value & Volume, %, 2010–2016
    • Milks Manufacturer Shares: Mead Johnson and Abbott vie for the lead in the powdered segment, but Abbott is well clear in liquid and concentrated formulae
      • Table Baby Milks: Manufacturer Shares by Segment, % Value, 2013–2015
    • Milks Brands: Abbott's Similac brand remains ahead of Mead Johnson's Enfamil, with Gerber's Good Start the only other significant force in the market
    • Milks Brands: In the powdered formula segment, Similac Advance leads from Enfamil Premium, with Enfamil Gentlease ranking third
      • Table Powdered Formula: Leading Brands, % Value, 2010–2015
    • Milks Brands: In volume terms, Gerber Good Start Gentle Plus ranks fourth in powdered formulae, marginally ahead of Similac Sensitive
      • Table Powdered Formula: Leading Brands, % Volume, 2010–2015
    • Milks Brands: The liquid formula segment is less fragmented, and Abbott's Similac brand is more dominant here than in powdered formulae
      • Table Liquid Formula: Leading Brands, 2012–2015
    • Milks Brands: Within the liquid concentrate segment, Similac Advance was the leading brand in 2014, ahead of Enfamil Premium and Gerber Good Start Gentle
      • Table Liquid Concentrate: Leading Brands, 2013 & 2014
    • Sector Analysis: Baby Cereals
    • Cereals Sector Trends: As a result of the higher prices of snacks, the sector rose by 9.4% between 2010 and 2016, although consumption was 6.8% down
    • Cereals Per Capita Trends: In 2016, per capita consumption of cereals & finger foods amounted to 4.9kg, representing a 5.5% decline on the 2010 level
    • Cereals Segmentation: In 2016, finger foods accounted for 45% of sector value, having taken share from traditional cereals
      • Table Baby Cereals & Finger Foods: Segmentation, % Value, 2010–2016
    • Cereals Segmentation: Mainstream cereals mostly retail at US$9-US$13 per kg, while organic products typically cost three or four times this amount
      • Table Baby Cereals: Brand Price Positioning Analysis, 2017
    • Cereals Segmentation: The price of finger foods range widely, from US$25 per kg for cereal bars up to over US$80 per kg for organic snacks
      • Table Baby Finger Foods: Brand Price Positioning Analysis, 2017
    • Cereals Segmentation: A variety of pack types is available, but plastic tubs and canisters are the most widely used
    • Cereals Manufacturer Shares: Although Nestlé remains dominant, it is facing increased competition from smaller companies — mainly organic specialists
      • Table Baby Cereals: Manufacturer/Brand Shares, %, 2010–2016
    • Cereals Brands: Nestlé's Gerber brand remains the dominant brand in the US baby cereals sector, accounting for 73% of sales value
    • Sector Analysis: Baby Meals
    • Meals Sector Trends: Between 2010 and 2016, sales in value increased by 41% to reach US$1.5 billion, while volume fell by 14% to 195,300 tons
    • Meals Per Capita Trends: Per capita consumption is low in comparison with many developed countries, at 49.5kg in 2016
    • Meals Segmentation: The involvement of the leading manufacturers and the introduction of pouches have seen the organic sector approach 50% of the market
    • Meals Segmentation: Manufacturers are focusing their attention on older babies and toddlers
    • Meals Segmentation: Jars and plastic pots retail at prices considerably below those of pouches
      • Table Baby Meals: Brand Price Positioning Analysis, 2017
    • Meals Segmentation: Price competition is strong, particularly between organic companies, while Gerber's products are firmly in the mid-price category
      • Table Baby Meals: Brand Price Positioning Analysis, 2017 (Cont...)
    • Meals Segmentation: The packaging of meals has diversified considerably in recent years, with plastic pots and pouches now holding significant shares, alongside jars
    • Meals Manufacturer Shares: Nestlé dominates the sector, but it has lost share as newer entrants have made an impact
      • Table Wet Baby Meals: Manufacturer Shares, %, 2010–2016
    • Meals Brand Shares: Gerber Second Foods remains the leading brand, and Gerber products dominate the top 10
      • Table Wet Baby Meals: Brand Shares, %, 2009–2011
    • Meals Brand Shares: Most manufacturers field a range of different sub-brands to meet differing consumption occasions and ages
    • Meals Brand Shares: A wide range of other brands are available, some of them only in certain areas of the US, and mostly active in the organic pouches segment
    • Sector Analysis: Baby Drinks
    • Drinks Sector Trends: Sales of drinks have fallen by over 50% since 2010, with a negative health image
    • Drinks Per Capita Trends: Per capita consumption of drinks has more than halved since 2010, falling from 12.6 liters per capita to 5.7 liters per capita in 2016
    • Drinks Segmentation: A variety of different juice products are available, packaged in plastic bottles
      • Table Baby Drinks: Retail Prices by Manufacturer, Brand and Product, 2017
    • Drinks Manufacturer Shares: Nestlé holds a virtual monopoly, with most other players having now withdrawn
      • Table Baby Drinks: Brand Shares, % Value, 2010–2016
  • Production and Trade
    • Production: The US is a major producer of baby milks, as well as other baby foods
    • Imports: With strong domestic production, imports do not play a significant role in the US baby food market
    • Exports: The US is a significant exporter of infant formulae and cereals, and exports more than doubled in terms of value between 2010 and 2015
  • Company Profiles
    • Company Profiles: Three companies account for the vast majority of baby food sales in the US: Abbott, Mead Johnson, and Nestlé
    • Company Profiles: Abbott Nutrition
    • Company Profiles: Mead Johnson Nutritionals
    • Company Profiles: Gerber Products Co. –Nestlé Infant Nutrition
    • Company Profiles: Beech Nut Nutrition Corp (Hero)
    • Company Profiles: Plum Organics (Campbell Soup Company)
    • Company Profiles: The Hain Celestial Group Inc.
    • Company Profiles: The Hain Celestial Group Inc.
    • Company Profiles: Perrigo Company Plc.
  • Distribution
    • Retail Structure: Hypermarkets, supermarkets and hard-discounters accounted for 70% of packaged food sales
      • Table Packaged Food Sales by Channel, US$ Billion, 2009–2015
    • Baby Food Retailing: Supermarkets continue to account for the majority of infant formula sales, but competition has been strong from less traditional channels
      • Table Infant Formula Sales by Outlet Type, % Value, 2010–2016
      • Table Frequency of Infant Formula Purchase, 2008 & 2014
    • Baby Food Retailing: Supermarkets and in particular grocery stores have also seen their share of other baby food come under threat
      • Table Other Baby Food Sales by Outlet Type, %, 2010–2016
    • Baby Food Retailing: Online purchasing is becoming a more frequent phenomenon, with a significant proportion of mothers using click and collect services
      • Table Online vs. In-store Purchases, 2014
      • Table In-store Promotion of Baby & Toddler Food by Type, 2015
  • Economic Background
    • Economic Background: The arrival of President Trump in the Whitehouse is likely to see changes to economic policy, with increased infrastructure spending
      • Table Economic Indicators, 2010–2017
    • Key Macroeconomic Forecasts: Economic growth is forecast to be quite buoyant, but global political uncertainty may cause instability
      • Table Key Macro-Economic Forecasts, 2016–2022
  • Prospects and Forecasts
    • Birth and Population Projections: It seems unlikely that the downward trend in the number of births will be reversed in 2017, but it may subsequently pick up
      • Table Birth & Population Projections, 2006–2022
    • Forecast Overview: The US market for baby food will begin to expand again from 2018, and will increase by 3.4% in volume between 2016 and 2022
    • Future Trends: Sales are forecast to reach US$8.2 billion in 2022, 19.3% up on 2016, with growth driven by segments such as pouches, snacks, and toddler milk
  • Appendix
    • The Baby Population: The number of babies fell from its 2008 peak of 12.8 million babies to 11.8 million in 2016, but is forecast to pick up again by 2022
      • Table Baby Population, Number of Babies ('000), 2010–2022
    • Market Value: Market value rose by only 8% between 2010 and 2016, but at US$6.9 billion, this is the second largest market in the world
      • Table Baby Food: Market Value, Current Prices, 2010–2016
    • Market Value: In real terms, the market underwent a 2% drop, with meals the only sector to have bucked the negative trend
      • Table Baby Food: Market Value, Constant Prices, 2010–2016
    • Market Volume: Consumption was down by nearly 16% in 2016 compared with 2010
      • Table Baby Food: Market Volume, 000 Tons, 2010–2016
    • Per Capita Expenditure: Average expenditure per baby rose by 9.5% between 2010 and 2016 to US$1,744
      • Table Baby Food: Per Capita Expenditure, Current Prices, 2010–2016
    • Per Capita Expenditure: Milks accounted for 74% of expenditure on baby food
      • Table Baby Food: Per Capita Expenditure, Constant Prices, 2010–2016
    • Per Capita Consumption: Per capita consumption fell from over 124kg in 2010 to less than 106kg in 2016
      • Table Baby Food: Per Capita Consumption, Grams, 2010–2016
    • Milks: The market has been set in decline in the face of a falling birth rate and rising breastfeeding trends
      • Table Baby Milks: Sector Trends, 2010–2016
    • Milks: Growing-up milk and special formulae have been taking share from first- and second-stage milks
      • Table Baby Milks: Sector Segmentation, Value & Volume, 2011–2016
    • Milks: Mead Johnson's products retail at a premium price compared to Abbott's
      • Table US: Infant Formula Prices, Milk Powder, September 2017
    • Milks: Nestlé is the cheapest of the main three suppliers, but private labels undercut it by a significant margin
      • Table US: Infant Formula Prices, Milk Powder, September 2017 (Cont...)
    • Milks: Liquid milks retail at US$7.40-US$11.60 per liter
      • Table US: Infant Formula Prices, Liquid Milk, September 2017
    • Cereals: Sales of cereals have been buoyed up by the finger foods sector, where most recent launches have occurred
      • Table Baby Cereals: Sector Trends, 2010–2016
    • Meals: The introduction of organic meals and pouch formats has raised prices, lifting value sales by 41%, but consumption has fallen back by 14%
      • Table Baby Meals: Sector Trends, 2010–2016
    • Drinks: The drinks sector is set in unremitting decline, with sales more than halving between 2010 and 2016
      • Table Baby Drinks: Sector Trends, 2010–2016
    • Imports: Imports have declined significantly, although imports of milks and cereals have begun to pick up
      • Table Baby Food: Import Trends, Value, 2010–2015
      • Table Baby Food: Import Trends, Volume, 2010–2015
    • Imports: The Netherlands has recently become the main supplier of imported milks and cereals
      • Table Milk & Cereals by Country of Origin, Value and Volume, 2010–2015
    • Imports: Canada and Latin American countries are the main suppliers of other baby food imports
      • Table Imports of Baby Meals by Country of Origin, Value & Volume, 2010–2015
    • Exports: Exports of milks & cereals are substantial at over 30,000 tons each year, dwarfing other sectors
      • Table Baby Food: Export Trends, Value, 2010–2015
      • Table Baby Food: Export Trends, Volume, 2010–2015
    • Exports: Half of milks & cereals exports are destined for Canada, but China and Hong Kong have become increasingly significant partners
      • Table Exports of Milks & Cereals by Country of Destination, Value, 2010–2015
    • Exports: Most of the remainder of milks & cereals exports are destined for countries in South or Central America
      • Table Exports of Milks & Cereals by Country of Destination, Volume, 2010–2015
    • Exports: Northern neighbor Canada is the main export destination for meals
      • Table Exports of Baby Meals by Country of Destination, Value, 2010–2015
    • Exports: Canada, Australia, and Mexico together take two-thirds of US exports of baby meals
      • Table Exports of Baby Meals by Country of Destination, Volume, 2010–2015
    • Value Forecasts: Retail sales of baby food are forecast to increase by 19% to US$8.2 billion by 2022
      • Table Baby Food: Market Value Forecasts, Current Prices, 2016–2022
    • Value Forecasts: With the exception of drinks, all market sectors will show real terms growth
      • Table Baby Food: Market Value Forecasts, Constant Prices, 2016–2022
    • Volume Forecasts: From 2018, consumption is expected to begin to recover, and by 2022 will stand 3.4% up on the 2016 level
      • Table Baby Food: Market Volume Forecasts, Tons, 2016–2022
    • Per Capita Forecasts: Per capita expenditure will rise by nearly 15% between 2016 and 2022 to reach just over US$2,000 per baby
      • Table Baby Food: Per Capita Expenditure, Current Prices, 2016–2022
    • Per Capita Forecasts: In real terms, per capita expenditure growth will be very modest
      • Table Baby Food: Per Capita Expenditure, Constant Prices, 2016–2022
    • Per Capita Forecasts: Per capita consumption increases will be sluggish
      • Table Baby Food: Per Capita Consumption, Grams, 2016–2022
    • Summary Methodology

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