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United States bread production market: $39.0 billion industry by 2018
Bread Production in the US - Industry Market Research Report - a new market research report on 2014-04-28 12:36:03
Changing nutrition trends have adversely affected the United States Bread Production market over the past five years. Popular diets have left some consumers with a negative image of this industry´s products, and operators have responded with innovations to attract newly healthconscious consumers. The industry has also faced volatile input costs.

Bread producers have attempted to keep up with America´s ever-changing and diverse palate. Operators have gamely developed products to cater to consumers´ love of low-calorie foods, whole grains, low-carb products and the latest widespread food trend, gluten-free products. This fad diet and its kin have even turned a small number of Americans away from the flagship products of this industry altogether.

These sometimes costly innovations have introduced Americans to products from "sandwich thins" that are low in carbohydrates and calories, to gluten-free pretzels and crackers. These new products have raised demand for the industry´s products some, but not enough to raise revenue. Industry revenue fell at an annualized rate of 1.0% to $36.9 billion during the five years to 2013, including a 0.8% increase in 2013.

Another challenge the industry faced was rising input costs, namely wheat and sugar. Skyrocketing costs for these inputs decreased profit for firms that were unable to pass them on to downstream buyers such as grocery stores in the form of higher prices. This was particularly true during the recession, when consumers shifted from name brand to private-label, i.e. generic, brands to save money. Private-label sales jumped 7.4% in 2009, according to the Nielsen Company. These challenges, coupled with the added cost of continued product innovation to create food products that cater to shifting diet trends, led to falling profit. Profit represented 7.2% of revenue in 2008 but is expected to have fallen to 6.0% of revenue in 2013.

In the next five years, consumers will continue to become more health conscious. In response, firms will continue innovating healthy products by, for example, reducing the amount of carbohydrates per serving while adding more wholesome ingredients (e.g. barley and oats). Also, portable products will be designed to appeal to the time-poor consumer. As a result of meeting changing consumer trends, revenue is projected to grow 1.1% per year on average to $39.0 billion during the five years to 2018.

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