Market Research Reports - Ken Research Saudi Arabia Cereals Market Research Report

Evolution of Health and Wellness Food Products in Saudi Arabia to Amplify Growth of
Breakfast Cereals Market: Ken Research
Saudi Arabia’s unstable economy in the recent years has led to inflation of various grocery
products. Few grocery products in Saudi Arabia did not witness a decline in consumption;
however, a few other categories have slowed major fall in demand due to their high prices.
Breakfast cereals prices have risen due to the country’s slowed economy. Saudi Arabia ranks
20th in the bakery products market around the world while generating huge revenue for the
country. Mondelez International Inc is the leading international bakery company that
introduced bakery products sector in Saudi Arabia.
Saudi Arabia had witnessed a severe shortage of labour in the recent years and the government
started the Nitaqat program which had an inverse impact over the market. This program is an
initiative to encourage businesses to hire Saudi nationals and had a negative impact on the
traditional grocery retailers and bakeries. Traditional grocery retail market accounts for a major
share of bakery products causing it the biggest retail channel for bakery sales in Saudi Arabia
with products such as unpackaged breads, cakes, and pastries. The distribution channels of the
breakfast cereals in Saudi are through hypermarkets, supermarkets, convenience stores,
department stores, e-Retailers, and other general retailers.
Recent studies indicate that about 807 new bakery products were launched in Saudi Arabia in
the recent years. Out of these new bakery products, 45% are new products and rest are a
combination of new variation in the form of packaging, formulation, and variety of already
existing products. Within the 807 new products, the top five ingredients used were white sugar,
salt, wheat flour, sodium hydrogen carbonate, and emulsifiers. In 615 products white sugar,
salt, and wheat flour are the most commonly used ingredients along with vegetable oils, palm
oil, skimmed milk powder, and disodium diphosphate. Also, 47% of the new bakery products
were domestic, while other imported products were originated in the United Arab Emirates,
Italy or Turkey. Consumers are increasing their preference for international bakery products
rather than country made bakery products.
Awareness in health and wellness food products amongst Saudi consumers has increased and
consumers are modifying their diet accordingly. It was observed that there is an increase in
demand for whole wheat, reduced-sugar, and gluten-free bakery products by health-conscious
consumers. The domestic leading player in Saudi Arabia's bakery product industry is Almarai Co.
Ltd. The various bakery products in Saudi are crispbread, gingerbread, sweet biscuits, toasted
bread, rusks, wafers, waffles and other bakery products. The bakery products market in Saudi
Arabia is estimated to grow at a rapid rate due to the increasing population. The bakery product
is a subsector within bakery products category and witnesses a huge growth in terms of sales