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SIAL Canada - Exporting to the EU
Anne-Sophie Hottiaux, Agri-Food Trade Commissioner, Canadian Consulate, Düsseldorf, Germany
The recent seminar by Anne-Sophie Hottiaux emphasized the export opportunities available to Canadian suppliers in the health and wellness market of the European Union (EU). Anne-Sophie began by providing an overview of the European market, and how it stacks-up against other major markets in the world. While Europe was notable on several aspects, where the market really stood out was in its impressive $13.1 trillion GDP. Anne-Sophie highlighted the EU as the largest market on earth, encompassing 27 countries, with 500 million inhabitants, a significant middle-class and a well-educated consumer-base. These factors, combined with an aging population, make the EU a particularly attractive market for Canadian health and wellness products and ingredients.
Within the EU, the top three largest markets include Germany, with a population of 82.3 million, followed by the United Kingdom (UK) with a population of over 60 million, and France with 63.4 million consumers. Core EU countries have world-renowned agriculture sectors that are vital to their economies. Despite this the EU purchases more than $150 billion of food/seafood imports from non-European countries annually. In 2009, Canada's largest food export market in the EU was Italy, receiving $456 million in exports, the UK with $401 million, and Belgium with $369 million.
An interesting point Anne-Sophie discussed was the factors that are impacting the consumer market and increasing demand for healthy products in the EU, and thus creating growth opportunities for Canadian exporters. Globalization is driving increasing availability of products, as well as interest in ethnic food and a movement toward simplicity. At the same time, environmental factors are fuelling demand for ethical food, regional/local products, and perhaps even increased vegetarianism. Demographic and lifestyle changes have also led to increasingly busier consumers, who have less time and are less active. Lastly, Europe's ageing society is greatly impacting consumer trends and market demands, particularly with regards to health-related products. These factors have helped to move the health and wellness sector in the EU out of a niche category, and into the mainstream market.
Not surprisingly, Anne-Sophie pointed out that the LOHAS (Lifestyles of Health and Sustainability) consumer market segment in the EU has been growing. Consumers are also showing increasing interest in honest and authentic food products, such as products that are free-from additives or artificial ingredients, as well as organic and regional products. As a result, the top trends in health and wellness listed by Anne-Sophie are: organics, functional food, food intolerance, authenticity, and "better-for-you" products. Vegetarianism has also been gaining increasing awareness and prominence in the market.
Following are some facts from the presentation which further highlight the strength of the health and wellness market in the EU. There has been a strong decrease in foods that contain preservatives or high levels of sugar or sodium, while expenditures on health and wellness increased more than 17% in Western Europe, from 2005 to 2009. The categories with the highest expenditures in 2009 were "naturally healthy", followed by "better-for-you", and fortified/functional.
Italy, Germany, France and the UK have been experiencing promising retail value growth in the health and wellness sector, with Germany being the largest market. Functional foods have seen particularly strong growth in Western Europe, with the UK the largest market for this sub-sector, as well as for "better-for-you" products. Organics having been driving growth in health and wellness, and have become increasingly available in the EU. Germany represents the largest market, with 5.8 billion EUR in sales in 2010. The food intolerance market is the smallest sub-sector within health and wellness, comprising mostly gluten- and lactose-free products. However, in Germany the gluten intolerant population represents 15% of consumers, and the third largest market in the EU, after the UK and Italy. Germany also has a noticeable vegetarian population of 6 million, providing opportunities for meat alternatives, while Switzerland has the second highest rate of vegetarianism in the EU, and the UK the third. Products which combine a number of popular trends, such as health and wellness and sustainability, have also been growing in presence.
While the EU presents a number of opportunities for Canadian exporters, Anne-Sophie also touched on various challenges that companies should take into consideration when planning to enter the EU market. Despite the EU's 27 countries sharing a number of commonalities, a challenge is the large differences that do exist within consumption trends and habits, as well as how food is perceived and marketed. The high standards and strict regulations on ingredients, claims and labelling should also be taken into consideration in developing a strategy, as well as the fact that Europe is a competitive market with consumers who have discerning tastes.
Despite some challenges, high average incomes, a well-educated and aging population make the EU an ideal destination for Canadian health foods and ingredients. Canada benefits from a strong image in the growing EU market, and some of the export opportunities include ingredients, reformulated, specialty and convenience products, functional foods, GMO-free and organic products, as well as fruit and vegetable products. Canadian companies interested in exporting to the EU were recommended to utilize the Trade Commissioner Service available to them and visit the European market information section on the ATS website.
If you have any further questions regarding this information shared during this presentation, please contact:
Agri-Food Trade Commissioner, Canadian Consulate
Until next time,
Project Officer, ATS
Bones // 1-July-11
"It's much easier to understand when you put it that way!"
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