Astor Group Brazil: Food and Beverage Market
Brazil: Food and Beverage Market
Outlook
Although inflation and interest rates will continue to fluctuate over the coming years, we believe that positive macro trends will drive sustained growth in Brazil’s food and beverage industry and even more attention from multinational companies and private equity investors. Interest in Brazil is predicated on strong fundamentals and a market too large to ignore. In a country famed for income inequality, extreme poverty was cut in half between 2003 and 2008, and Brazil’s C class alone now represents a larger market than the entire population of Germany, France or the United Kingdom. While effective social programs have received a lot of the credit, substantial increases in real wages and the lowest unemployment in Brazil’s history have been significant factors. Moreover, the expansion of consumer credit has fueled a new class of consumers eager to enjoy what for so long has been out of reach. In the coming years, demographic trends will only accelerate these consumers’ aggregate purchasing power. Unlike the United States, where baby boomers are now retiring, or China, where the one-child policy has caused the working-age population to shrink, Brazil is entering its prime. The percentage of people between 25 and 50 is expected to grow 30 percent over the next 10 years. The impact on the food and beverage industry of more consumers, with more money and more credit cannot be overstated.
- Organic foods - Snacks - Nutritional foods - Diet and light products - Ready-to-drink fruit juices
Domestic Market Overview
Outperforming Food Categories
- Organic foods - Snacks - Nutritional foods - Diet and light products - Ready-to-drink fruit juices
Lifestyle Trends
- Increasing demand for chilled frozen and ready-made products - Increasing proportion of meals consumed outside of the home.
Food Retail
-2nd wave of private label introductions, with image adjustment, quality improvement, and price slightly under the
Outlook
Although inflation and interest rates will continue to fluctuate over the coming years, we believe that positive macro trends will drive sustained growth in Brazil’s food and beverage industry and even more attention from multinational companies and private equity investors. Interest in Brazil is predicated on strong fundamentals and a market too large to ignore. In a country famed for income inequality, extreme poverty was cut in half between 2003 and 2008, and Brazil’s C class alone now represents a larger market than the entire population of Germany, France or the United Kingdom. While effective social programs have received a lot of the credit, substantial increases in real wages and the lowest unemployment in Brazil’s history have been significant factors. Moreover, the expansion of consumer credit has fueled a new class of consumers eager to enjoy what for so long has been out of reach. In the coming years, demographic trends will only accelerate these consumers’ aggregate purchasing power. Unlike the United States, where baby boomers are now retiring, or China, where the one-child policy has caused the working-age population to shrink, Brazil is entering its prime. The percentage of people between 25 and 50 is expected to grow 30 percent over the next 10 years. The impact on the food and beverage industry of more consumers, with more money and more credit cannot be overstated.
- Organic foods - Snacks - Nutritional foods - Diet and light products - Ready-to-drink fruit juices
Domestic Market Overview
Outperforming Food Categories
- Organic foods - Snacks - Nutritional foods - Diet and light products - Ready-to-drink fruit juices
Lifestyle Trends
- Increasing demand for chilled frozen and ready-made products - Increasing proportion of meals consumed outside of the home.
Food Retail
-2nd wave of private label introductions, with image adjustment, quality improvement, and price slightly under the