The report, available via Companiesandmarkets.com, says that sugar confectionery is expected to experience a negative compound annual growth rate (CAGR) from 2013-2018.
Any growth is expected to come in Eastern Europe while government and social pressure on sugar is expected to impact marketing of sugar confections elsewhere.
Unhealthy image
Tosin Jack, research analyst at Frost & Sullivan told ConfectioneryNews: “The challenges faced by the confectionery product market are predominantly due to the health and wellness trend. …The sugar confectionery market is likely to experience the biggest growth challenge of the three segments, as it increasingly becomes more challenging for manufacturers to innovate and communicate the functional benefits in a sugar product.”
The overall confectionery market (chocolate, sugar confectionery and gum) market is expected to reach €61.87bn ($72.94bn) based on a negative CAGR of 0.3%. But the sugar confectionery is projected to register a negative CAGR 1.7%.
Jack said the negative outlook was predominantly due to a health and wellness trend.
“The increasing prevalence of diseases such as obesity and diabetes has led to more health conscious consumers, as various governments step up to deal with the issue by creating awareness through campaigns," she said.
"In particular, there have been increased reports and media attention on the reduction of sugar in children’s diet as concerns about child obesity continue to grow. This poses a considerable challenge for sugar confectioneries given that they are generally targeted towards younger consumers."
The analyst said this meant consumers were demanding foods with less or no sugar, even in their confectionery products.
Marketing constraints
Companiesandmarkets.com added that growing concerns on child obesity had resulted in regulatory limitation on related advertisements, which had constrained market growth in sugar confectionery products that are generally directed at kids.
“The UK government are concentrating on clear labelling legislation combined with health education and are waiting on the way taxation impacts on other markets,” said Mike King, director of Companiesandmarkets.com.
France, Mexico and Hungary are among the countries that have imposed taxes on sugary goods, though these are mostly on soft drinks.
Sugar in the diet
According to a UK National Diet and Nutrition survey from 2008 to 2012, overall confectionery accounted for 9% of an adults sugar intake, 13% for teenager and 14% for children aged 4-10.
For children, the amount of sugar coming from confectionery was evenly split between chocolate and sugar confectionery. That made overall confectionery the second largest source of sugar for children and teenagers behind soft drinks, which accounted for 30% of sugar intake for teens and 17% for children.
In the past year, sugar confectionery and chocolate have been removed from many checkout aisles in the UK at retailers such as Aldi and Lidl and Tesco convenience stores.