Bakery has recorded fantastic growth rates in the Middle East over the years, but complexities, diets and rising prices have changed the baking landscape. Jamie Knights investigates

Last year Caterer Middle East featured an article on the changing face of bakery in the region. A year on we re-visit the complex sector to establish if there have been any changes, whether the fortunes of the industry have risen and what trends are dominating the market.

Research by Euromonitor International sheds vital light on the changing face of bakery, in terms of cost, health and a more knowledgeable consumer base.

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Baked goods saw retail value sales growth of 7% in 2011, compared to the corresponding figure of 6% seen in 2010. Baked goods saw retail volume sales growth of 5% in 2011 to reach 386,900 tonnes, compared to the corresponding growth of 6% seen in 2010.

Much of the higher sales growth can be attributed to the recovery in the economy alongside the fall in rental prices.

Consumers continued to limit their expenditure on eating out in 2011, preferring instead to allocate their rising disposable incomes towards purchasing higher quality grocery products, good news for the retail sector, not so good for the outlets.

Last year there was a focus on the rising costs associated with bakery and despite continued intervention from the government, the average unit price of baked goods increased by 2% in 2011.

Euromonitor International stated that while some manufacturers complied with the new official price lists, others kept their prices the same.

But there were additional factors in the rise, one of which was consumer health concerns, whereby more expensive whole grain products saw gains in market share over white bread.

Outlets benefitted from offering a wide variety of baked goods at competitive prices, but there was increased competition for standalone bakeries in the form of in-store bakeries which became increasingly popular in supermarkets.

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