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DAIRY PRODUCTS

Milk formula leading market segment in baby food market in UAE in 2017
Thursday, 03 January, 2019, 14 : 00 PM [IST]
Ken Research’s report, titled UAE Baby Food Market Outlook to 2022 - By Category (Dried Baby Food, Prepared Baby Food, Milk Formula and Other Baby Food), By Inorganic and Organic Baby Food, By Region (Abu Dhabi, Ajman, Sharjah, Dubai, Fujairah, Ras Al Khaimah and Umm Al Quwain), provided a comprehensive analysis of the baby food market in the United Arab Emirates.

While the report forecast the market between 2018 and 2022, the historical period covered in it was between 2012 and 2017.

It also covered the overall market size in terms of revenue and sales volume, SWOT analysis, decision making process, competitive landscape and growth drivers and trends and government’s role and regulations.

The report concluded with market projections for future market described above and analyst recommendations highlighting the major opportunities and cautions for the UAE baby food market.

Market overview
The baby food market in the UAE is still in its growth stage. The market displayed a strong competitive scenario where international players that hold the majority of the stake are constantly trying to increase their existing market share.

The UAE Baby Food market has majorly been an import-dominated market. The market is receptive to newness and innovations. For instance, camel milk-based baby food products and Halal baby food products have gained a lot of popularity in the country.

Despite the fact that the government is encouraging breast-feeding among new mothers and the economic impact due to oil price shock of mid-2014 that continued till 2015, the baby food market has shown consistent growth.

UAE baby food market segmentation
By food category (dried baby food, prepared baby food, other baby food and milk formula): Milk formula is the most conventional baby food product in the market and is considered as the prime substitute of mother’s milk. Therefore, it was the leading market segment in the year 2017 with a considerable revenue share.

By nature (organic and inorganic food): This segmentation includes baby food categories such as dried baby food, prepared baby food and other baby food, but not milk formula. In the UAE baby food market, the majority of the share was held by inorganic baby food due to the reasonable price positioning over organic food.

By age (0-6 months, 6-12 months and 12+ months): Stage 3 milk formulae for babies aged 12 months and above was the leading category in terms of sales due to the larger population size. Best selling stage-3 milk formulae brands included Nido, Nan, Illume, Progress Gold, Pediasure and Isomer.

By region (Abu Dhabi, Ajman, Sharjah, Dubai, Fujairah, Ras Al Khaimah and Umm Al Quwain): Dubai accounted for the largest sale of baby food, followed by Abu Dhabi. About 75 per cent of the revenue is contributed collectively by the emirates of Abu Dhabi and Dubai. The other regions such as Ajman, Fujairah, Ras Al Khaimah and Umm Al Quwain have a very limited market share.

By channel of distribution (hypermarkets, supermarkets, independent small grocers, health and beauty specialist retailers, other foods non-grocery specialists and Internet retailing): The supply of baby food in the UAE is taken care of majorly by offline stores, including hypermarkets and supermarkets. Subsequent purchases after consulting health experts are made from these renowned and trustworthy megastores. Presently, Internet retailing channels like e-commerce websites, company websites, baby product-specific websites and websites of offline stores accounted for a very low share in the distribution.

By milk formula (standard milk powdered formula, follow-on milk powdered formula, growing-up milk formula and special baby milk formula): The majority of the milk formula sales in the UAE baby food market contributed through growing-up milk formula products. It held a dominant share in the market. This was followed by follow-on milk formula and standard milk formula. The remaining segments that contributed to the market were special baby milk formula, which is primarily required by infants with special nutritional needs or they are allergic to some specific ingredient.

Competitive landscape
Competition within the UAE baby food market was observed as highly concentrated along with the presence of 11 major manufacturers of baby food competing on parameters, such as product variant, channels of distribution and price.

The leading players in the market are international companies that directly import finished baby food products in the UAE. The domestic companies which are selling baby food products have a negligible market share.

The majority of the market shares were held by Nestle, Danone and Abbott. The remaining market share was captured by companies such as Kraft Heinz Co., HiPP GmbH & Co Vertrieb KG, Hero Group GmbH, Hain Celestial Group Inc, DMK Deutsches Milchkontor GmbH, Holle Baby Food GmbH and United Pharmaceuticals.

UAE baby food market future outlook
In the near future, it is anticipated that the UAE Baby food market will increase at an significant revenue CAGR (compound annual growth rate) until 2022. In case of market segmentation by food category, the demand for conventional milk formula is expected to fall by the end of the year 2022.

In case of types of milk formulae, the demand for follow-on milk formula is expected to fall from slightly from 2017 to the end of the year 2022 while the demand for other milk formula like special baby milk formula, standard powdered milk formula, and especially growing-up milk formula is expected to rise.

The UAE Baby food market is expected over the forecast period due to increase in women’s participation in the workforce, rising per capita income and GDP (gross domestic product) of the country and increasing awareness among new parents to complete the nutritional requirements of their children.

Key segments covered
    • Food category (dried baby food, prepared baby food, milk formula and other baby food)
    • Types of milk formula
    • Age group
    • Nature of food (Inorganic and organic baby food)
    • By region (Abu Dhabi, Ajman, Sharjah, Dubai, Fujairah, Ras Al Khaimah and Umm Al Quwain)
    • By channels of distribution (hypermarkets, supermarkets, independent small grocers, health and beauty specialist, other foods and non-grocery specialist and Internet retailing)

Key target audience
    • Baby product manufacturers
    • Baby product distributors
    • Government agencies
    • Baby food store retailing
    • NGOs (non-governmental organisations) supporting baby food and care
    • Pharmaceutical stores
    • Online sales and retailing agencies

Companies covered
    • Nestle SA
    • Danone Group
    • Abbott Laboratories Inc
    • Others (Kraft Heinz Co, Hipp GmBH & Co Vertrieb KG and Hero Group GmbH)

Key topics covered in the report
    • Executive Summary
    • Research Methodology
    • Stakeholders in the UAE Baby Food Market
    • UAE Baby Food Market Overview and Genesis
    • Value Chain Analysis in the UAE Baby Food Market
    • UAE Baby Food Market Size, 2012-2017
    • UAE Baby Food Market Segmentation, 2013-2017
    • Trends and Developments in the UAE Baby Food Market
    • Issues and Challenges in the UAE Baby Food Market
    • Snapshot on Emerging Baby Foods in the UAE Baby Food Market
    • Decision Making Criteria for Consumers
    • Government Regulations in the UAE Baby Food Market
    • SWOT Analysis of UAE Baby Food Market
    • Competitive Landscape in the UAE Baby Food Market
    • UAE Baby Food Market Future Outlook and Projections, 2017-2022
    • Analyst Recommendations in the UAE Baby Food Market
 
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