Australia's sweet tooth has kept the Ice Cream Manufacturing industry afloat despite rising input prices, changing consumer dietary trends and a recessive economy.
Melbourne, Australia (PRWEB) November 09, 2011
Far from melting in the heat of the global economic crisis, the ice cream industry is expected to remain resilient, according to IBISWorld, the nation’s largest publisher of industry research. Anticipated stability in milk prices, combined with increased volumes and a move toward high-margin, premium products is expected to sustain industry performance over the next five years. As global economic conditions began to improve toward the last quarter of 2009-10, the industry benefited from renewed consumer confidence and discretionary spending. IBISWorld estimates that industry revenue will increase until 2015-16 to a total of $540 million.
Australia's sweet tooth has kept the Ice Cream Manufacturing industry afloat despite rising input prices, changing consumer dietary trends and a recessive economy. There have been dramatic increases in milk and sugar prices in the past five years and falling production volumes, partly offset by an increase in average selling prices. The advent and subsequent growth of the health-conscious consumer has required producers to be innovative with their product lines and adapt them to changing consumer trends. In the five years through 2010-11, industry revenue is estimated to have increased at an annualised rate of 2.3% to total $485 million. Revenue growth of 3.6% is anticipated in the current year.
The ice cream industry's major players such as Nestle and Unilever are extremely well entrenched in the domestic market and their brands command enviable levels of loyalty. Consequently, they have had the ability to pass on unexpected cost increases down the supply chain during times of dramatic input price volatility, such as occurred in 2007-08. Despite a stagnant domestic market, industry exports have fallen over the past five years due to the appreciation of the Australian dollar, weak global demand and transport limitations imposed by the perishable nature of the product. In contrast, imports are expected to increase due to the volatility in domestic demand and supply conditions that forced producers to resort to overseas markets to source their products.
According to IBISWorld analyst, Paul Lyons, over the next five years, stability in input prices and a move toward the production of high-margin, premium products that address the trends of health and convenience. “Future growth is also tied to innovation and new product development,” says Lyons. “The emphasis on health and nutrition is expected to continue to drive new product choices with an increase in organic, soy, gluten-free and low-fat ice creams.” As global economic conditions improve, strong export growth, particularly within Asian markets, is also expected to drive general industry growth. Over the five years through 2015-16, industry revenue is expected to increase to total $540 million.
For more information, download the full report from IBISWorld on the Ice Cream industry
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