Coated foods face new challenges as Europe’s increasingly affluent consumers turn towards higher-value fresh and chilled proteins.
The growth in demand for coated foods witnessed during the economic downturn now appears to have stalled. Despite relatively high levels of new product activity – which has included the development of more novel coatings, in response to changing consumer tastes – there is evidence that in larger markets such as the UK and Germany, consumers are now turning towards fresh and chilled products, which are perceived as offering higher quality. Nevertheless, many types of coated foods still retain a large and loyal following, especially now that nutritional profiles have improved.
Coated Fish & Seafood
Although sales of coated fish and seafood across Western Europe remain on the high side, growth has stagnated in some of the region’s largest markets of late. Despite the perception that fish represents a healthier protein source than meat, as well as the convenience offered by many coated products, sales have been adversely affected by the trend towards fresh and chilled fish in parts of Europe. The Western European market is dominated by a few large countries – for example, the UK and Germany account for the bulk of sales of fish fingers throughout the region, which were estimated at 375,000 tonnes in 2014.
Western Europe’s largest market for coated fish products is the UK, as might be expected given the position of fish and chips as one of the nation’s favourite meals. According to data from the National Federation of Fish Friers, 80% of UK consumers visit fish and chip shops at least once a year, whilst over a fifth (22%) do so on a weekly basis. An estimated 382 million meals are served via the UK’s fish and chip shops every year, a figure which equates to approximately six meals per capita. As a result, demand remains high for products such as frozen battered fish portions, which can help to replicate the ‘fish and chip shop’ experience in the home.
One of the largest sectors within the UK market for frozen coated fish and seafood is fish fingers, which remain especially popular with younger consumers. In 2014, sales were worth GBP124m, of which branded products accounted for GBP90m, or 72.6% of overall sales. Volume sales within the sector were worth an estimated 28,500 tonnes. Although fish fingers remain a staple of many UK meals, demand has fallen within the last year, with volume sales having declined by over 2%. Much of this has been attributed to growing competition from fresh and chilled fish, particularly tuna and salmon.
The UK market for battered and breaded fish has also suffered for similar reasons – as the economic situation improves, it appears that more people are turning towards higher-value fresh fish and seafood. In 2014, UK sales of frozen battered fish fillets were worth GBP140m, having fallen by 7% during the last year. During the same period, the market for frozen breaded fish fillets experienced a decrease of 3.5%, despite relatively high levels of new product activity from major suppliers.
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