German Market – Higher Quality Offerings Shape Demand

In 2012, frozen processed food in Germany registered a 1% decline in current value terms, while retail volume sales stagnated. This performance was mainly due to price competition in a highly competitive landscape and the development of organic and other health and wellness frozen processed food types.

While consumers in other European countries may have reduced their spending in response to the euro crisis, German consumers continued to consume higher quality foods in 2012. Frozen processed food has long been celebrated for its high level of convenience among German consumers. However, 2012 saw growing concerns about the chemicals used to produce these products. This was due to multiple food scandals in 2010 and 2011, which negatively affected demand.

Average unit price declines by 1%

Average unit price in frozen processed food declined by 1%, in current terms, in 2012. However, average unit price in frozen processed red meat and frozen bakery registered a stronger decline. These price movements were related to the fall in global prices of necessary raw materials. Furthermore, the decline in average unit price in frozen processed food was also due to the low prices of private label products and the strong retail value share held by discounters. Frozen meat substitutes posted strong year-on-year double-digit growth in both retail volume and current value terms over the review period. Manufacturers and retailers have become aware of the strong potential of frozen meat substit...