Recession drives shoppers back to white sliced

Sales of organic and ‘extra healthy’ bread plummetted 30% and 15% respectively, while white bread sales soared 13% in the year to July 2009, according to Warburtons’ latest bakery market review.

By volume, white bread sales were up 1.7% while brown bread volumes slumped 3.4%. However, volumes of breads with extra grains and seeds also grew 1.7%, showing that some premium products had managed to succeed during the recession.

Legislative changes enabling bakers to produce ‘non-standard’ loaves (300g, 600g, 1,000g etc) had also added fresh impetus to the market, said chairman Jonathan Warburton.

“The number of bakery products bought each day currently totals more than 12.1M and household penetration still remains at around 99.8%,” said Warburton. “However, reseach has shown that shoppers have been reducing the number of discretionary purchases and have instead opted for versatile staples and lower cost per serving products that meet the needs of the whole family.”

The strong growth in white sliced also reflected a growing trend to make more packed lunches and a rise in bakery products consumed at breakfast (mainly higher toast consumption), he said.

While total volume growth in wrapped bread declined slightly (-1.2%), sales values were up 7.4% to £1.9bn. The overall bakery category saw a 5% rise in value sales to £3.8bn.

Some of the biggest drops in sales were in wrapped rolls, where sales volumes slumped 6.8%. Again, organic and ‘for health’ products suffered the most, with volumes down 52% and 25% respectively.

However, there were strong performances from crumpets (up 10% by volume and 29% by value) and English muffins (up 10% by volume and 10% by value).

As for pricing, the market clearing price for the 2009 wheat crop is likely to be considerably lower than last year, offering potentially improved margins for manufacturers, City analysts are predicting. However, they claim retailers will also expect to share the benefits.

Warburtons is now the UK’s second largest grocery brand behind Coca-Cola and the number one selling branded bakery manufacturer. It has a 32.3% share of spend on wrapped bread, followed by Hovis (Premier Foods) at 22.7% and Kingsmill (Associated British Foods - ABF) at 16.9%, according to Nielsen data.

*The Organic Trade Board is holding a summit on October 8 at London Southbank University to explore how organic firms can work together to educate consumers about the benefits of organic food following recent sales slumps. For full details of Selling Organic: What’s the Story?​ click here​