Hong Kong Baby Food, 2020

Hong Kong Baby Food, 2020

Summary

Hong Kong Baby Food, 2020 is an analytical report by GlobalData which provides extensive and highly detailed current and future market trends in the Hong Kong market.

The number of babies born to women residing in Hong Kong has fallen heavily from 2017 to 2019. The number of working women has been increasing over the past few years. In 2018, almost two million women were in the labour force, making up 49.6% of the total labour force. Employment rates among women of childbearing age are high, at over 80% among women aged 25 to 34. The breastfeeding rates have increased significantly over the past decade. Hong Kong's baby food market is unique, in that it is distorted by a large parallel trade in infant formula with China, which is significantly larger than the size of domestic consumption in Hong Kong itself. Domestic consumption, meanwhile, has declined since 2017, due to the fall in the number of births. Over the period of 2013 to 2019, retail sales in the domestic market has risen.

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
  • The number of babies born to women residing in Hong Kong has fallen heavily from 2017 to 2019, giving a very low estimated birth rate of 6.7 per thousand people.
  • Milks are by far the most important category in Hong Kong’s total baby food market, accounting for 97.5% of overall value in 2019 and 95.9% of volume.
  • Within the total sector, only finger foods have grown significantly in volume terms since 2013, although all categories except drinks have experienced an increase in retail sales at constant 2013 prices.
  • The importance of infant formula means that companies with strength in the formula category dominate overall. FrieslandCampina and Mead Johnson are neck-and-neck at the top of the sector, and FrieslandCampina is thought to have inched ahead in 2018/19.
  • Drugstores/pharmacies/baby stores are the most popular outlets for purchases of baby food, due to their strength in the milks category. In 2019, they held an estimated two-thirds of retail sales. Purchasing by phone and online ordering are also growing rapidly due to their convenience; these purchases are now estimated to claim an estimated XX% of sales.
  • Future domestic demand for baby food in Hong Kong will be badly affected by the predicted fall in the number of live births. The overall milks sector will decline by 30% in volume from 2019 to 2025. Other categories are also expected to struggle in the face of lower births, and only finger foods, and to a smaller extent wet meals, will expand in volume.
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: Categories
    • Definitions: Terminology
    • Definitions: This report provides two sets of data
  • Background to the Market
    • Births – Live Birth Rates: The annual number of births has tumbled since 2016, and is likely to stand at only just over 50 thousand in 2019
      • Table Birth & Population Trends, 2009–2019
    • Births – Live Birth Rates: The proportion of births to non-resident women has dropped to less than 8%
      • Table Birth Trends by Mother's Place of Residence, 2008–2017
    • The Consumer: Although Hong Kong has one of the highest standards of living in the world, there is significant income inequality
    • Socio-Demographic Trends – Number of Women of Childbearing Age: The number of women of peak childbearing years (25–39) has increased slightly
      • Table Number of Women of Childbearing Age, 2010–2018
    • Socio-Demographic Trends – Births by Age of Mother: The average age of giving birth has been rising steadily
      • Table Live Births by Age of Mother, %, 2011–2016
    • Working Women – Female Employment: Employment rates among women of childbearing age are high, at over 80%
      • Table Trends in Working Women, 2011–2018
    • Working Women – Legislation: Maternity leave duration is short but the government has announced it will be increased to 14 weeks
    • Breastfeeding Trends – Promotion: The government has introduced a number of measures to support breastfeeding
    • Breastfeeding Trends – Prevalence: The breastfeeding initiation rate has been growing in the past two decades, reaching a high of 88.4% in 2015
      • Table Breastfeeding Rates on Discharge, 1992–2018
    • Breastfeeding Trends – Prevalence: Breastfeeding rates, exclusive and partial, have increased significantly since 2012
      • Table Breastfeeding Rates, 2012–2016
    • Regulations: In June 2017, a voluntary code of marketing for milk formula and baby food was introduced, which critics claim is ineffective
    • Regulations: It is possible that the voluntary code will be strengthened in the future to improve consumer protection
  • Market Overview
    • Sector Overview: The overall sector (including sales which end up on the mainland) has continued to grow, but low birth numbers have held back domestic sales
    • Sector Overview: Total sales in Hong Kong still include a large proportion of infant formula sales destined for mainland China
      • Table Total Baby Food Market Size, 2019 & Growth Rates, 2013–2019
      • Table Domestic Baby Food Market Size, 2019 & Growth Rates, 2013–2019
    • Manufacturer Shares: The market is the preserve of multinationals, with the top five accounting for 88.5% of value sales in 2019
      • Table Baby Food: Manufacturer Shares, %, 2013–2019
    • Manufacturer Shares: Despite the dominance of the milk suppliers, several other companies have a strong presence in individual categories
      • Table Baby Food: Manufacturer Shares by Category, % Value, 2019
  • Category Analysis
    • Category Analysis: Baby Milks
    • Milks Category Trends: Demand has continued to increase, although at a slower rate than in the period up to 2014
      • Table Baby Milks: Category Size, 2019
      • Table Baby Milks: Category Growth, % 2013–2019
    • Milks Sector Total Trends: Measures to address local shortages and changes in conditions in mainland China have begun to slow sales
    • Milks Category Total Trends: Export controls will remain in place for the foreseeable future
    • Milks Domestic Category Trends: Volume sales have fallen by 20% since 2013, due mainly to lower birth numbers
      • Table Baby Milks: Category Size, Domestic Market, 2019
      • Table Baby Milks: Domestic Category Growth, % 2013–2019
    • Milks Domestic Per Capita Trends: Even excluding the parallel trade, local consumption of infant formulae is high, at 25.3kg per baby aged 0–3 years
    • Baby Milks Per Capita Trends: Per capita consumption of growing-up milks is high on an international scale, but lower than consumption among younger babies
    • Baby Milks Segmentation: Sales of growing-up milks accounted for half of value sales in 2019
    • Baby Milks Segmentation: Demand is growing for organic, HMO, and A2 milks
    • Baby Milks Segmentation: Strong demand means that prices of baby milks are generally high in Hong Kong
      • Table Baby Milks: Brand Price Positioning Analysis, 2019
    • Baby Milks Segmentation: Growing-up milk is considerably cheaper than first and second-stage formula
      • Table Baby Milks: Brand Price Positioning Analysis, 2019
    • Baby Milks Segmentation: Prices in pharmacies/drugstores are at least 10% lower than in supermarket chains
      • Table Baby Milks: Price Differentials, Supermarkets vs. Pharmacies/Drugstores, September 2019
    • Baby Milks Segmentation: 900g products account for 65% of facings; cans are the most prevalent pack type
      • Table Baby Milks: Facings Allocation by Pack Type, 2019
      • Table Baby Milks: Facings Allocation by Pack Size, 2019
    • Baby Milks Manufacturer Shares: The market is almost entirely in the hands of the multinationals, with the top five accounting for 90% of value
      • Table Baby Milks: Manufacturer Shares, % Value 2013–2019, & % Volume 2017–2019
    • Baby Milks Brands: FrieslandCampina's Friso and Mead Johnson's Enfa range lead the category, followed by Nestlé's Wyeth brands
    • Baby Milks Brands: Both Abbott and Danone have seen their shares rise slightly in recent years
    • Baby Milks Brands: There are many minor brands on the market, mostly from European and Asian/Australasian suppliers
    • Category Analysis: Baby Cereals & Dry Meals
    • Cereals & Dry Meals Category Trends: The category is small, at HK$109.5 million (US$14.1 million) in 2019, but has grown by 29% since 2013
      • Table Baby Cereals & Dry Meals: Category Size, 2019
      • Table Baby Cereals & Dry Meals: Category Growth, % 2013–2019
    • Baby Cereals & Dry Meals Per Capita Trends: Per capita consumption stood at 2.3kgper baby aged 0–3 in 2019
    • Baby Cereals & Dry Meals Segmentation: A significant proportion of products are marketed as organic cereals
    • Baby Cereals & Dry Meals Segmentation: For cereals, prices range from US$25 to US$80 per kilogram, with the bulk priced below US$45
      • Table Baby Cereals & Dry Meals: Price Positioning, 2019
    • Baby Cereals & Dry Meals Segmentation: Over half of products are packaged in boxes, with 250g the most prevalent pack size
      • Table Baby Cereals & Dry Meals: Facings Allocation by Pack Size, 2019
      • Table Baby Cereals & Dry Meals: Facings Allocation by Pack Type, 2019
    • Baby Cereals & Dry Meals Brands: Nestlé and Heinz are losing share to specialist organic brands
      • Table Baby Cereals & Dried Meals: Manufacturer Shares, % Value 2013–2019, & % Volume 2017–2019
    • Baby Cereals & Dry Meals Brands: Specialist organic brands are increasingly available
    • Category Analysis: Wet Baby Meals
    • Wet Baby Meals Category Trends: This is the second-largest category in the baby food sector in volume terms
      • Table Baby Meals: Category Size, 2019
      • Table Baby Meals: Category Growth, % 2013–2019 2013–2019 2017–2018 2018–2019
    • Wet Meals Per Capita Trends: At 3.5kg, per capita consumption is above the levels seen in the region as a whole
    • Wet Baby Meals Segmentation: Sweet meals dominate, and organic products account for the majority of sales
    • Wet Baby Meals Segmentation: The prices of savory meals range from US$15 to US$40 per kg
      • Table Savory Wet Meals: Price Positioning, 2019
    • Wet Baby Meals Segmentation: Sweet products packaged in pouches, many of which are also organic, retail at a premium to products in jars
      • Table Sweet Wet Baby Meals: Price Positioning, 2019
    • Wet Meals Segmentation: The swing towards pouches, first observed in sweet meals, has now spread to savory meals
      • Table Wet Baby Meals: Facings by Pack Type, 2019
    • Wet Baby Meals Manufacturers & Brands: Organic meals from Hain Celestial, Hipp, and Little Freddie dominate, accounting for 67.5% of value sales in 2019
      • Table Wet Baby Meals: Manufacturer Shares, % Value 2013–2019, % Volume 2017–2019
    • Wet Baby Meals Manufacturers & Brands: The category continues to attract new entrants
    • Category Analysis: Baby Drinks
    • Baby Drinks Category Trends: Volume sales are low and have been declining steadily
      • Table Baby Drinks: Category Size, 2019
      • Table Baby Drinks: Category Growth, % 2013–2019
    • Baby Drinks Per Capita Trends: Per capita consumption of drinks stood at a mere 0.3 liters in 2019
    • Baby Drinks Segmentation: The category consists mainly of ready-to-drink fruit juices, but a few baby waters are also on sale
      • Table Baby Drinks: Price Positioning, 2019
    • Baby Drinks Segmentation: Around half of drinks are now sold in cartons, with 100ml and 200ml the dominant pack sizes
      • Table Baby Drinks: Facings Allocation by Pack Size
      • Table Baby Drinks: Facings Allocation by Pack Type
    • Baby Drinks Manufacturers & Brands: Heinz, Nestlé and Hipp dominate sales, with a combined value share of 84% in 2019
      • Table Baby Drinks: Manufacturer Shares, % Value 2013–2019, & % Volume 2017–2019
    • Category Analysis: Finger Foods
    • Finger Foods Category Trends: The swing towards more modern snacks fueled value growth of 75% between 2013 and 2019
      • Table Baby Finger Foods: Category Size, 2019
      • Table Baby Finger Foods: Category Growth, % 2013–2019
    • Finger Foods Per Capita Trends: Per capita consumption of finger food was less than 0.6kg in 2019, although this was a 25% increase over 2013
    • Finger Foods Segmentation: The variety of finger foods is broadening, from teething rusks to biscuits, puffs, rice cakes and other snacks
    • Finger Foods Segmentation: Rusks and biscuits retail at a lower price than more modern snacks and puffs
      • Table Finger Foods: Price Positioning, 2019
    • Finger Foods Segmentation: Pack materials and types vary according to the finger food type
      • Table Finger Foods: Facings Allocation by Pack Size
      • Table Finger Foods: Facings Allocation by Pack Type
    • Finger Foods Manufacturers & Brands: Many specialized companies are active in the finger foods sector, but multinationals dominate
      • Table Finger Foods: Manufacturer Shares, % Value 2013–2019, & % Volume 2017–2019
  • Production and Trade
    • Production: Hong Kong is entirely dependent on imports
    • Imports: Imports rose sharply between 2013 and 2018, as demand from mainland Chinese parents purchasing baby milk in Hong Kong boomed
    • Imports: Imports based on export figures from supplying countries indicate far higher volumes than Hong Kong's import figures
    • Exports: Exports to China have risen very strongly from 2016 onwards
  • Company Profiles
    • Company Profiles: FrieslandCampina (Hong Kong) Limited
    • Company Profiles: Mead Johnson Nutrition
      • Table Market shares, 2019:
      • Table Mead Johnson: Sales in China & Hong Kong, 2011–2016
    • Company Profiles: Nestlé Hong Kong Limited
      • Table Market shares, 2019:
    • Company Profiles: Abbott Laboratories Limited
    • Company Profiles: Danone Nutricia Early Life Nutrition (Hong Kong) Ltd
      • Table Market shares, 2019:
    • Company Profiles: Hipp
      • Table Market shares, 2019:
    • Company Profiles: Heinz Hong Kong Limited
      • Table Market shares, 2019:
  • Distribution
    • Baby Food Retailing: A wide variety of online and brick and mortar outlets vie for position
      • Table Baby Food Sales by Channel, % Value, 2013–2019
  • Economic Background
    • Economic Background: The economy is generally strong, but has been expanding more slowly over the past two years after a peak in 2017
      • Table Key Macro-Economic Indicators, 2013–2019
    • Key Macroeconomic Forecasts: Real GDP growth is set to hover at an estimated 2.6% per annum up to 2025
      • Table Annual Retail Price & GDP Growth, 2019–2025
  • Prospects and Forecasts
    • Birth and Population Projections: By 2025, the number of births is expected to fall to
      • Table Birth & Population Projections, 2013–2025
    • Forecast Overview: Parallel trade with mainland China will shrink, and domestic consumption will be adversely affected by low birth numbers
      • Table Baby Food: Category Growth, 2019–2025
    • Future trends: Most indicators point to a declining market over the next few years
    • Future trends: Finger foods are the only category expected to show significant volume growth
  • Appendix
    • Appendix — The Baby Population: The baby population is expected to decline by 10.5% between 2019 and 2025
      • Table Baby Population, Number of Babies, 2009–2025
    • Appendix — Women of Childbearing Age: The number of women in the peak childbearing years (25–39) is forecast to increase
      • Table Number of Women of Childbearing Age by Age Group, 2015–2023
    • Appendix — Market Value: Sales increases are slowing as parallel imports continue to drop
      • Table Baby Food: Total Market Value, Current Prices, 2013–2019
    • Appendix — Market Value: Growth has been strong in finger foods and appreciable in wet meals
      • Table Baby Food: Total Market Value, Constant Prices, 2013–2019
    • Appendix — Market Value: The total market, including sales to mainland consumers, stood at US$1.3 billion in 2019
      • Table Baby Food: Total Market Value, US$ Million, 2013–2019
    • Appendix — Market Volume: Total consumption rose to 26,546 tons in 2019
      • Table Baby Food: Total Market Volume, Tons, 2013–2019
    • Appendix — Market Value: Sales of baby food for the local market have grown by 11% since 2013
      • Table Baby Food: Domestic Market Value, Current Prices, 2013–2019
    • Appendix — Market Value: Since 2014, the local market has fallen in constant price terms
      • Table Baby Food: Domestic Market Value, Constant Prices, 2013–2019
    • Appendix — Market Value: The domestic market was valued at US$236 million in 2019
      • Table Baby Food: Domestic Market Value, US$ Million, 2013–2019
    • Appendix — Market Volume: Infant formula dominates the local market, but other categories are gradually gaining share
      • Table Baby Food: Domestic Market Volume, Tons, 2013–2019
    • Appendix — Per Capita Expenditure: Per capita expenditure on baby food rose by 22% from 2013 to 2019, to HK$11,029
      • Table Baby Food: Domestic Per Capita Expenditure, Current Prices, 2013–2019
    • Appendix — Per Capita Expenditure: In constant price terms, per capita expenditure has stagnated over the last three years
      • Table Baby Food: Per Capita Expenditure, Constant Prices, 2013–2019
    • Appendix — Per Capita Expenditure: Expenditure per baby stood at US$1,425 in 2019
      • Table Baby Food: Domestic Per Capita Expenditure, US Dollars, 2013–2019
    • Appendix — Per Capita Consumption: Per capita consumption has risen by 7% since 2013
      • Table Baby Food: Domestic Per Capita Consumption, Grams, 2013–2019
    • Appendix — Milks: Milks consumed on the domestic market have fallen more slowly than the total market including products consumed on the mainland
      • Table Baby Milks: Category Trends, Total Sales 2013–2019
    • Appendix — Milks: Growing-up milks are popular and steadily gaining share at the expense of first and second-stage formulae
      • Table Baby Milks: Category Segmentation, Value & Volume, 2013–2019
    • Appendix — Milks: Eleva Organic is Abbott's highest priced milk
      • Table Baby Milks: Brand Price Analysis, 2019
    • Appendix — Milks: Danone's Aptamil Allecure Pepti was the highest priced milk identified in 2019
      • Table Baby Milks: Brand Price Analysis, 2019
    • Appendix — Milks: Mead Johnson and Nestlé both operate in the mid to high-priced range
      • Table Baby Milks: Brand Price Analysis, 2019
    • Appendix — Milks: Nestle's premium Illuma range has been significantly extended
      • Table Baby Milks: Brand Price Analysis, 2019
    • Appendix — Milks: The popular A2 Platinum range retails at around US$57 per kg
      • Table Baby Milks: Brand Price Analysis, 2019
    • Appendix — Cereals & Dry Meals: Cereals account for only 1.1% of total value sales
      • Table Baby Cereals & Dry Meals: Category Trends, Total Sales, 2013–2019
    • Appendix — Wet Meals: Although consumption has been falling since a 2014 peak, value has grown thanks to an increase in sales of organic meals and pouches
      • Table Baby Wet Meals: Category Trends, Total Sales, 2013–2019
    • Appendix — Drinks: The drinks category is small and has continued to shrink over the past five years
      • Table Baby Drinks: Category Trends, Total Sales, 2013–2019
    • Appendix — Finger Foods: The category is buoyant and has shown the fastest growth, fueled by an increasing demand for snacks
      • Table Finger Foods: Category Trends, Total Sales, 2013–2019
    • Appendix — Imports: Imports — dominated by milks — have flourished to fuel the growing demand from mainland China
      • Table Baby Milks & Cereals: Trends in Imports, 2013–2018
    • Appendix — Imports: Imports — dominated by milks — have flourished to fuel the growing demand from mainland China
      • Table Imports of Baby Milks & Cereals by Country of Origin, 2016–2018
    • Appendix — Imports: China, the US and Ireland together accounted for over 80% of volume imports in 2018
      • Table Imports of Other Baby Food by Type, % Volume and Value, 2013–2018
    • Appendix — Imports: China, the US and Ireland together accounted for over 80% of volume imports in 2018
      • Table Imports of Other Baby Food, by Country of Origin 2016–2018
    • Appendix — Exports: Exports of baby food are composed primarily of milks and cereals and rose steeply in 2016, 2017 and 2018
      • Table Baby Milks & Cereals: Trends in Exports, 2013–2018
      • Table Exports of Milks & Cereals by Country of Origin, % Volume and Value, 2016–2018
    • Appendix — Exports: Most baby food exports are destined for China
      • Table Baby Milks & Cereals: Trends in Exports, 2013–2018
      • Table Exports of Other Baby Food, by Country of Origin 2016–2018
    • Appendix — Value Forecasts: Total market value, including sales destined for mainland China, is forecast to fall to HK$8.2 billion by 2025
      • Table Baby Food: Total Market Value Forecasts, Current Prices, 2019–2025
    • Appendix — Value Forecasts: In real terms, the total market will fall by almost 30% between 2019 and 2025, mainly as a result of declining cross-border sales
      • Table Baby Food: Total Market Value Forecasts, Constant Prices, 2019–2025
    • Appendix — Value Forecasts: Total market value is forecast to stand at US$1.1 billion in 2025
      • Table Baby Food: Total Market Value Forecasts, US Dollars Million, 2019–2025
    • Appendix — Volume Forecasts: Total consumption will fall back by almost 30%, due to the decline in sales of infant formulae destined for mainland China
      • Table Baby Food: Total Market Volume Forecasts, Tons, 2019–2025
    • Appendix — Value Forecasts: The domestic market will rise to HK$2.1 billion by 2025
      • Table Baby Food: Domestic Market Value Forecasts, Current Prices, 2019–2025
    • Appendix — Value Forecasts: At constant prices, the domestic market will remain stable up to 2025
      • Table Baby Food: Domestic Market Value Forecasts, Constant Prices, 2019–2025
    • Appendix — Value Forecasts: The domestic market will be worth around US$270 million by 2025
      • Table Baby Food: Domestic Market Value Forecasts, US Dollars Million, 2019–2025
    • Appendix — Volume Forecasts: Domestic consumption will fall slightly, due to lower birth numbers
      • Table Baby Food: Domestic Market Value Forecasts, US Dollars Million, 2019–2025
    • Appendix — Per Capita Forecasts: Expenditure per baby aged 0–3 will reach HK$14,109 by 2025 (+28% over 2019)
      • Table Baby Food: Domestic Per Capita Expenditure, Current Prices, 2019–2025
    • Appendix — Per Capita Forecasts: At constant prices, domestic per capita expenditure will rise by 11%
      • Table Baby Food: Domestic Per Capita Expenditure, Constant Prices, 2019–2025
    • Appendix — Per Capita Forecasts: Per capita expenditure will reach US$1,823 by 2025
      • Table Baby Food: Domestic Per Capita Expenditure, US Dollars, 2019–2025
    • Appendix — Per Capita Forecasts: Apart from the very small drinks category, per capita consumption will increase in all categories
      • Table Baby Food: Domestic Per Capita Consumption, Grams, 2019–2025
    • Appendix — Storechecks: The largest proportion of facings, 32%, was accounted for by wet meals, followed by milks (30%)
      • Table Facings Allocation by Product Type
    • Summary Methodology

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