The bakery and pastry market - Italy (2023)

1.2 A Growing Global Market

In ****, global sales of bakery and confectionery products were estimated at $*** billion. The global bakery and confectionery market is expected to grow at a CAGR of *%, reaching an estimated market size of $***.* billion in **** .[***]

Global bakery market size World, ****-****, US$ billion

Europe holds the leadership in the sector, thanks to the presence in its territory of a large number of local bakeries (***), combined with the high demand of consumers who, even in the face of the spread of new work patterns based on smart working and demographic changes, continue to seek ready-made baked goods, sold in family packs and with a long shelf life.

Since the pandemic, a legacy has emerged that can encapsulate evolving consumer tastes and preferences in the production of an ever-expanding new offering .[***]

Global market trends

Demand for bread and greater varieties has steadily increased, leading to the production of specific types of products, such as ethnic breads, whole grain breads, oats, bran, seeds, etc. Sales are driven by the fact that these products constitute an essential diet for consumers. Regardless of the consumer's income, bread is an essential and primary product in the community diet. Bread manufacturers are leveraging the acceptance of regional specialty breads ...

1.3 Evolution of the Italian market

The bread and pastry market is facing a time of evolution in response to emerging trends and consumer preferences. The market for artisanal fresh bread production remains very popular in Italy, covering about **.* percent of the market. Average production stands slightly below * million units.[***]

For **** and ****, forecasts indicate growth in the Italian food market, with rates around * percent annually, although these figures could have changes caused by inflation affecting Europe. Specifically, in Italy, the flour and coffee sectors will achieve the best performance.[***]

Performance analysis - growth of (***) compartments Italy, ****, % Sweet Savory

As shown in the graph below, production in value (***) of bakery and pastry products has been growing in recent years, compared to the first available data from ****. Specifically, it can be seen that the growth, with the exception of ****, has been steady. From **** to **** , the percentage growth rate was +**.*%. In **** there was a decline of **.* percent, and then positive growth again in **** of **.* percent. Production in value and quantity of bakery and pastry products Italy, ****-****, € billion Istat

1.4 Imports and exports

To analyze Italy's trade balance for the bakery and confectionery market we will use HS Code ****: Bread, pastry, cakes, cookies, other bakery products, including those containing cocoa.

Imports, exports and coverage rate for HS Code **** Italy, ****-****, in billion dollars and % Source: ****

As shown in the chart above, Italy is a net exporter of bakery products, which is why the coverage rate has been on an upward trend in recent years. From **** to **** , a growth of **.* percent occurs. On the other hand, as far as imports are concerned, the values remain significantly lower, hovering around * billion euros (***).

Breakdown of bread and pastry imports, by main supplier countries Italy, ****, in % Source: ****

The main supplier countries of the product belonging to the analyzed category, as shown in the graph above , are Germany (***). Breakdown of bread and pastry exports, by main customer countries Italy, ****, in % Source: UN Comtrade In terms of consumer countries of the Italian product, France (***).

1.5 Impact of the derivative

Spending on cereal derivatives in **** grew at a low rate compared to other supply chains, only *.* percent, after a tentative *.* percent in ****. Weighing most heavily on the trend were bread sales, with spending down*.* percent in value and *.* percent in volume compared to **** , and the inevitable loss of the special occasion confectionery segment, which after an Easter and Christmas in "social estrangement" suffered sales losses of more than ** percent.

Snack purchases remained stable at last year's levels, holding up despite the partial closure of schools and the increased presence of mothers in the kitchen. On the other hand, the sector was positively driven by a surge in pantry sales.

The "star" product of **** remains flour, which was almost unobtainable on the shelves in some weeks due to supply difficulties after the unexpected rise in demand, touching peaks of *** percent of spending over similar periods in ****. The flour segment accounted for * percent of cereal derivatives sales during this period, and its value grew by ** percent overall[***].

Italian artisan bakers in this period of crisis have been working at full capacity between workshop activities and home deliveries. "Bread artisans," says Palmino Poli, president of Aibi, "have shown strong social sensitivity in this situation, ...

1.6

2.1 Demand characteristics and factors influencing demand

Bread and baked goods are booming in Italy as more and more people turn to their local bakery or supermarket instead of baking at home. Italy's milling industry processes *,***,*** tons of soft wheat annually, which enables the production of about *,***,*** tons of flour, ** percent of which is used for the production of breads (***), and ** percent for the production of pizza, confectionery or pastry products. Annual per capita consumption is around ** kg in Italy.[***]

According to the latest survey conducted by Italmopa, **% of Italians surveyed habitually consume bread and its derivatives, while **% of respondents say they do not cons ume it or consume it occasionally. The main reason for excluding bread consumption from the diet is dietary and health-related.[***]

Drivers of choice in the purchase of bread and its derivatives

The main factors influencing consumption of the product are taste and freshness, which in bakery products are essential; fresh foods are understood to be of higher quality, although (***) the perception of quality in packaged foods is steadily increasing. Another driver in recent years is craftsmanship, with ** percent of the sample knowing and appreciating sourdough. Beyond that, an important trend in the sector is related to health and wellness, which inevitably translates into ...

2.2 Geographical distribution of demand

As can be seen from the graph below, there is not a big difference between the different macro regions in terms of average monthly household spending on bread and cereals. However, it is worth noting that the Northwest presents the highest expenditure on these products.

Regarding consumption habits, even at the time of the Coronavirus, Italians confirmed their preference for bread made from selected raw materials. Consumers in this country do not always want the same bread, they like to change and seek quality, authenticity and nutritional value. Therefore, products made with ancient grains, unrefined, stone-ground or whole grain flours, with seeds, fiber and low glycemic content, spelt, soy, rye and multigrains win."[***].

2.3 Curiosity and the search for a healthy diet drive consumption

The main drivers of consumption in this market are as follows[***]:

Healthy Diet: Growing orientation toward products made with unrefined raw materials and no chemical additives. Curiosity: Consumers are attracted to novelty, are curious and want to experience new, well-presented and narrated offerings. Reduced weights: Demand is oriented toward small-sized bread that reduces waste and is more versatile (***) and toward bread that is curated in shape. Attention to origin: Greater attention to the origin of raw materials, which explains the success of supply chain operations that enhance Km * productions. Rediscovery of traditional flavors: Preference toward bread and pastries that have taste, are made with natural leavening, with sourdough and baked in a wood-fired oven. Freshness: implying the availability of fresh product throughout the day.

In general, consumers are willing to pay a premium price for a product they offer:

Wellness-Healthy products since proper nutrition influences both fitness and health "Free From" products chosen even in the absence of specific ailments as a promise of greater health and control: free of sugar, lactose, salt, gluten, yeast, and hydrogenated fats; Functional products containing protein, fiber and nutrients (***); More digestible products: for an aging population (***). Safety-Natural products: information and transparency about raw materials and ...

2.4

2.5

3.1 Market structure and dynamics

Italy has always been a key player in the sector, being endowed with a significant number of enterprises producing bakery and pastry products, even considering the value of exports, it can be seen that this market is essential for the Italian economy. However, it shows a decline in the number of active enterprises from **** to date, by about **.* percent. The decline has been gradual from year to year, starting in **** where a decrease of *.* percent is attested.

Evolution of the number of active enterprises in the production of bakery and confectionery products Italy, ****-****, in number of enterprises Source: ****

Another important figure to analyze in order to understand the structure of this market is the legal form of the enterprises that comprise it. On the production side, **.* percent of bakery and pastry businesses are owned by sole proprietors, freelancers or self-employed workers, as is the case for most artisan sectors in Italy. This makes this particular sector of the market extremely fragmented and not controlled by any major player.

Legal form companies active in the production of bread, fresh bakery products sector Italy, ****, % Istat

3.2 Geographical distribution specialty stores

Another important sector of the market is the retail sector consisting of stores specializing in breaks, cakes, sweets and confectionery. As can be seen from the map below, the geographic distribution of these stores is fairly aligned with the distribution of the Italian population. From this it can be seen that bakeries and confectionery shops are really widespread nationwide as well as evenly distributed with respect to the Italian population.

With the graph below, we highlight the breakdown in percentages, going to denote how the Northwest territories represent the player with the most active businesses in the sector taken into analysis.

Geographical distribution of bread, pastry, candy and confectionery specialty stores Italy, ****, % Istat

3.3 Market value chain

The value chain and operation of the bakery and pastry market in Italy is presented below.

3.4 Innovation in Italian industry: Baker_Eat

Rino Mini, an Italian entrepreneur known as "the king of water" for his role in the historic Galvanina brand, has decided to embark on a new business in Emilia Romagna in Covid's time. His idea is to open a chain of outlets that will be born under the new brand name "Baker_Eat" where flour produced from ancient and, when possible, indigenous grains will act as a collector. It is a mix between the "American bakery" and the "French boulangerie," with Italian style and local flour from ancient and, when possible, indigenous grains.

The entrepreneur plans to open a total of ** locations and the first three of the new network have already been planned: in Rimini, in the very central Corso near the Teatro Galli; in Santarcangelo di Romagna, in Piazza Ganganelli, with the transformation of the well-known restaurant "Ferramenta" into a "Baker Eat"; and on Mount Titano, inside the prestigious outlet "The Market," which will be inaugurated on June **.

Other openings are planned in Ravenna, Forlì, Cesena, Savignano, Cesenatico, Riccione, Cattolica and in Emilia (***), but the entrepreneur does not stop here: the plan is to expand throughout Italy, with solid bases in Rome and Milan

The entrepreneur also explains that ...

3.5

4.1 Overview of the offer

A varied and constantly updated supply stimulates additional purchases, offsetting the decline in traditionally understood bread and helping to shift sales to more profitable products. Diversification is increasingly practiced and is effective throughout the country, including small towns.

The gap between North and South has narrowed in recent years: bakers in the Central and South are becoming more receptive and responsive to change and are adapting their offerings to attract customers. In the North, bakers aim to include/enhance cafeteria offerings (***) and bakery production, even in the evenings, which favors gourmet take-out.

Pizza and focaccia have slowed the growth recorded in the past two years. Among the main causes, especially in large cities, is the crowding of offerings, often at very competitive prices, as well as the choice of alternative, less caloric meals that are also readily available in supermarkets. Demand for pizza is better in the south, thanks to evening takeout.

On the other hand, bakery is growing steadily.

Type of supply

The fresh pastry market in Italy consists of:

Artisan bakery: Bread (***) Pizza and focaccia Pastries

Homemade pastries: Cakes: Holiday desserts (***) Everyday desserts (***) Cakes for special occasions (***) Small pastries: filled with cream/chocolate, with fruit, etc. Cookies Brioches

Offer ...

4.2 Wheat: The main driver of supply

Soft wheat is the basic raw material for the domestic milling industry, which processes it into flour for bread and other baked goods. The Italian industry's supply depends on domestic production and international supply.

In **** , soft wheat sowings are expected to be about ***,*** hectares in total, an increase of *.* percent, or **,*** hectares more than last year. All areas show positive signs: +*.* percent in the Northwest (***).[***]

Wheat flour (***) production Italy, ****-****, in tons (***) Istat

As can be seen in the graph above, the trend in wheat i (***) flour production in tons in **** has declined, which is relatively low when considered compared to ****, and larger when **** is also considered. Specifically, we refer to a value of -*.**% from **** to **** and -*.**% when analyzing the last two years. Picking up on what was anticipated above, an increase in soft wheat production is projected for ****.

4.3 Prices

The Ukrainian conflict is fueling the economic crisis, especially in terms of rising costs of basic necessities (***), while the average price is about €*.**/kg. The situation does not improve in Forlì, where the maximum price is, again, around €*/kg. Then we move on to Venice, with a cost of €*.** , and to other Italian cities, such as Bologna, Trento, Udine, Modena, Macerata , and Ancona, where the price, at times, can exceed even €*/kg. Given the decline in the price of flour and the increase in the price of bread, we are in front of the clear example of how energy, real estate rent and labor costs rather than agricultural raw material weigh more than ** percent on the final price. [***]

The consumer price index for the bakery and confectionery products segment is shown below, and there is a noticeable growth over the past ** months, registering an increase of about *.* percent.

Consumer price index-other bakery and pastry products Italy, ****-****, base ****=*** - monthly data Istat

The table below shows the average prices of a one-pound loaf of bread in major Italian cities. As is evident, prices are highly variable, suggesting that bread price trends are only marginally dependent on the cost of wheat, with ...

4.4 The best bakeries and pastry shops in Italy

In the wide range of bakeries in Italy, Gambero Rosso has compiled a list of the best bakeries, divided by region, awarded the Tre Pani[***] recognition:

Piedmont: Vulaiga, Fobello (***). Lombardy: Voglia Di Pane, Brescia (***). Veneto: Olivieri ****, Arzignano (***). Trentino Alto Adige: Panificio Moderno, Isera (***). Friuli Venezia Giulia: Jerian, Trieste (***). Emilia Romagna: Forno Brisa, Bologna (***). Tuscany: Pank La Boulangeria, Florence (***). Marche: L' Assalto ai forni, Ascoli Piceno (***). Latium: Panificio Bonci, Rome (***). Campania: La Francesina Boulangerie, Ercolano (***). Puglia: Panificio Adriatico, Bari (***). Basilicata: Pane e pace, Matera (***). Sicily: Panificio Guccione, Palermo (***). Sardinia: PBread Natural Bakery, Cagliari (***).

Gambero Rosso compiled the same list covering the best pastry shops in Italy, awarded the Tre Torte recognition. Below is the list:

Piedmont : Dalmaso (***) Lombardy : Pasticceria Veneto (***) Veneto : Biasetto (***) Trentino-Alto Adige: Acherer Patisserie.Blumen (***) Emilia-Romagna: Gino Fabbri Pasticcere (***) Tuscany : Nuovo Mondo (***) Latium : Bompiani (***) Campania : Maison Manilia (***) Puglia : L'Arte Bianca (***) Sicily : Sciampagna (***)

4.5 Key supply trends

Healthy products

The healthy trend has also hit pastry and bakeries in Italy. Manufacturers have responded to the trend and implemented seasonal and healthier ingredients in their kitchens. Initiatives taken by bakeries and pastry shops include the following:

avoidance of certain ingredients, such as palm oil in favor of sunflower oil, compliance with recent regulations on nutrition labeling and decoration, a wider range of special/specialty breads according to the season, giving more space to healthy products in spring/summer.

Traditions

The concept of Made in Italy is very much present in the industry, and many producers are reviving it in an effort to increase the perceived quality of their products. This trend includes the rediscovery of typical local traditions and historical types of bread in the region, such as biove, michette, etc.

Wide range of offerings

The latest trend means that every bakery has the widest possible offer: regular white bread is no longer enough, as customers increasingly like more specialty products with different flavors. For this reason, bakeries have begun to:

offer small bread (***) but also ***-gram bread made with sourdough starter that can keep the sourdough starter for up to * days, give more and more space to the ...

5.1 Regulations

Bill No. *** on the production and sale of bread was filed on Dec. **, ****. Structured in ** articles divided into various sections, the legislative proposal aims to reorganize legislation regarding the production, marketing and sale of bread. Specifically, the first ** articles focus on aspects related to production, introducing key definitions such as that of "bread"; defined, therefore, as a product obtained from the total or partial baking of a dough, adequately leavened, prepared from wheat or other cereal flours and water, with or without the addition of sodium chloride or common salt, spices or herbs. Also outlined are the characteristics and types of bread, as well as the use of specific ingredients and products used for leavening in bread-making. Articles **-** deal with aspects related to the marketing and sale of bread;Article **, in particular, defines "bakery" as an enterprise that has a bread production facility and carries out the entire production cycle, from processing of raw materials to final baking. This section also deals with how bread is sold and transported. Articles **-** deal with the rules on supervision, from the adaptation of regional regulations and repeals, to the entry into force of the law. Supervision will be exercised by local health ...

5.2

6.1 Segmentation

• PaneAlba
• Morato Pane
• Grissitalia
• Roberto Industria Alimentare
• Bimbo Qsr
• Dolceria Alba
• Pasticceria Quadrifoglio
• Dolcificio Gi&sse
• Dulcistar
• Zero+4