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Pork demand picks up, outperforming rivals

Chloe RyanBy Chloe RyanOctober 27, 20174 Mins Read
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Pork sales have increased, with analysts suggesting the upturn could be linked to the current AHDB promotional campaign.

The latest figures from Kantar Worldpanel for the 12 weeks ending October 8 make positive reading for red meat and poultry, which returns to value and volume growth.

Beef is again in growth, whilst chicken volume gains continue year on year. Pork remains the ‘star performer’ in value terms, but rising prices haven’t driven a volume loss, with 4.5% more pork being bought compared to last year.

Inflation remains a significant force in the category, driving up the price of red meats, whilst chicken sees deflation stimulating volume growth. Chilled fish continues to struggle in the face of high inflation in natural and smoked fish – a consistent dynamic we’ve seen over recent periods.

Grocery inflation is currently 3.2%, although this is projected to fall in early 2018. The impact of this continued pressure on consumers in the Meat, Fish and Poultry (MFP) sector is a mixture of down trading and shoppers making more considered choices about the proteins and cuts they buy. The effect has widespread consequences, and we see shoppers moving their spend across proteins as well as into other more processed meals.

Nathan Ward, Business Unit Director for MFP said: “This update sees a really positive step for fresh primary meat and poultry, with value and volume leaping forward over the past latest weeks. Growth in the market has particularly been down to older and less affluent shoppers spending more.

“When we look at the proteins in more detail, pork continues to be the star performer. A recent AHDB marketing campaign on television and in-store promoted the use of pork at the mid week evening meal, and despite inflation pushing up prices, pork continues to grow volume as we see 2.28m more trips this year.

The growth is coming from a number of cuts, with leg roasts up 31% in volume, mince up 34% and steaks up 9%. Growth was not a result of promotions, which fell 27%, so the profile-raising AHDB campaign and the comparative value of pork compared with other red meat is likely to have had a positive impact. Beef has returned to volume growth as marinades and stewing beef drive growth for the protein. Mince volumes remain fairly flat, but rising prices have driven stronger value growth, up 7% on last year.”

“Promotional volumes continue to fall, but at a slower rate than previous updates, with deals only falling 6% on last year. We are seeing a change in the prevailing promotional mechanics. Price cuts are the most used promotion, and while retailers have pulled back significantly on volume-driving multi-buy deals over the last two years, we’ve seen a return to growth this period, with volumes up 8%. Retailers continue to look to this category to help drive bigger baskets for the store, and a resurgence in Meal Deals (up 18%) is helping to get more categories into our baskets.”

Despite recent stories about the poultry supply chain, we have not seen a huge impact as both primary and processed poultry are in growth. In primary chicken, this has been aided by increased promotional support (up 21%) which has helped to keep prices down and give a great value proposition. Chicken breasts are seeing volume growth of 5.4%, driven by an additional 380,000 shoppers, and prices down 1.7% in the latest 12 weeks. Whole birds are also seeing faster growth at 6.9% as prices fall by 4.1%, attracting 550,000 more shoppers over the period. Fresh processed poultry growth continues, driven by 6.9m more trips and 470,000 more shoppers buying into the quick, tasty and easy meals this offers.

We are quickly approaching the Christmas rush, with seasonal offerings hitting the store next to Halloween products. With all of the inflationary pressure in proteins will we see shoppers invest in having a great Christmas for everyone, or will we see the pressure on purses result in a more frugal feast for families?

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Chloe Ryan

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