June 17, 2015

17/06/2015: The flour market

First published in Milling and Grain, April 2015

The flour market in terms of revenue and volume is expected to reach USD 245.82 billion and 183,100.0 kilo ton respectively in 2020

Increasing demand for bread and bakery products and convenience staple food is the major factor driving the flour market globally. With the rise in per capita income and increasing awareness towards convenience food staples, demand for bread and bakery products has increased in recent years. Rising consumer awareness towards low protein gluten free food items is positively driving the consumption of non-wheat flours (rye, corn and rice) in the form of gluten free food items. Expansion of the aquatic feed industry in Asia Pacific has increased the flour consumption in the form of animal feed. These factors are considered to positively drive the growth of flour market during the forecast period from 2014 to 2020.


The global flour market, by application is divided into six application segments: noodles and pasta, bread and bakery products, wafers, crackers and biscuits, animal feed (including pet food), non food application (including bio plastics, biomaterials, and glue), and others (including roux and baby food). Both by revenue and volume, bread and bakery products were the largest contributor in global flour market in 2013, accounting for a market share of 38.73 percent and 35.61 percent respectively.
Generally, wheat flour is being used as principal ingredient for bread and bakery products. With the rise of per capita income and increasing awareness towards convenience food staples, demand for bread and bakery products has increased in recent years. Growth in consumption of bread and bakery products is triggered by factors such as increase in penetration of fast food industry in Asia Pacific and rising demand for convenience food due to lifestyle up gradation.

The global flour market has been segmented into four broad regions: North America, Europe, Asia Pacific and RoW. By volume, Asia Pacific contributed the largest market share in 2013, accounting for 37.32 percent of the overall market. Low average selling price of flour and high population density are key volume growth driver for Asia Pacific flour market. By revenue, Europe contributed the largest market share in 2013, accounting for 32.32 percent of the overall market. High per capita consumption of flour in the form of bread and bakery products and increase in average selling price of flour are key revenue growth drivers for Europe flour market.

Some of the leading players in the market are Ardent Mills Canada (Canada), Archer Daniels Midland Company (US), Associated British Foods plc (United Kingdom), ConAgra Foods, Inc. (US), General Mills Inc (US), King Arthur Flour Company, Inc. (US), Hindustan Unilever Limited (India), Hodgson Mill, ITC Limited (US), White Wings (Australia) and Wilmar International Limited (Singapore) among others.

Global Flour Market – Flourishing Animal Feed Market in Asia Pacific to Lead to Market Growth
The global flour and flour milling market is an important part of the global food industry and is a connecting link between farmers and food processors. The market has come a long way from the days when the use of water-and wind-driven mills was a norm. The modern flour market uses a combination of highly developed technology and skilled manpower and functions as a continuous-flow operation industry. Many large global mills operate 360 days a year.

Recent years have seen a huge expansion in the global flour market, both in terms of production capacity as well as increased global demand. Flour, a fine or coarse powder made by grinding grains, seeds, roots and a variety of cereals, is paramount to the global food industry. The use of flour as a base product in a variety of foodstuff makes the issue of quality and safety of raw materials a vital factor for the global food industry.

Thus, the global flour and flour milling market mostly utilises raw materials supplied by reliable sources that can guarantee excellent standards of food safety and crop protection, coupled with independent inspections at the processing end. Global import and export of food grains and a variety of flours is crucial to the operation of the global food industry. The flour market serves the food industry at all verticals: a bulk of it goes to larger food manufacturers and bakers, some amount is sold to in-store bakeries and craft bakeries, and some portion of the total global flour production is retailed directly to the consumers.

Increasing Consumer Preferences for Bakery Products Driving Demand
Rising urbanisation across the globe, increased health concerns related to high-protein flours, rising per-capita income of the global population, and changing customer taste are some of the key trends shaping the current state of the global flour market. The increased consumption of bakery and dough-based products to suffice the mounting global population is also a chief trend driving the global flour market.

While changing customer preference has led to a global rise in demand for previously regionally popular flours such as soya, corn, and rice flour, mounting concern about allergies and health issues associated with the use of high-protein flours has created significant opportunities for the market in the form of gluten-free, low-protein alternatives of popular flours. Deregulation of flourmills by government bodies across the world has also led to a flourishing market for privatised flourmills in Asia Pacific.

Asia Pacific and Europe Lead Global Flour Market
The global flour market serves a variety of food-and non-food-based industries through its products. Key applications of the flour market come in the manufacture of pasta, noodles, wafers, biscuits, crackers, bread and bakery products, animal feed, and in non-food applications such as biomaterials, glues, and bioplastics.

Rising consumer preference towards ready-to-eat foodstuff such as a variety of breads and bakery products, and the increased penetration of the fast food industry across the globe have made the global flour market an essential element in the global food chain. With rapidly modernising lifestyles and a constant rise in urbanisation across the globe, demand for easy-to-make staple foods has increased on a global level, providing an enormous thrust to the global flour market.

The flourishing aquatic feed industry and the expansion of commercial farmlands in Asia Pacific have also proved to be highly significant for the overall growth of the flour market due to an increased demand for flour used in animal and aquatic feed.

In 2013, the Asia Pacific market took up the largest market share of the global flour market in terms of demand by volume. Meanwhile, Europe led the global flour market in the same year in terms of revenue.

Source: Transparency Market Research

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which is published by Perendale Publishers Limited.

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