Canada Food and Drink Report

The Canada Food and Drink Report provides independent forecasts and competitive intelligence on Canada's food and drink industry.

There has been minimal merger, acquisition, and expansion activity in Canada this quarter largely due to a slowdown in the economy. We forecast a real GDP contraction of 1.4% for 2009 and, as a result, many companies are cautious of committing to heavy investments during this period of economic uncertainty. As the recession deepens consumers are also feeling the pinch and many have turned away from premium products, as discussed in this newly published Canada Food and Drink Report Q2009.

Although some food and drink companies have posted positive results this quarter, in general earnings have suffered. Canada's largest dairy processing company Saputo announced this quarter that, in the nine months to December 31 2008, its earnings fell to CAD57.8mn (US$47.1mn). Canadian soft drinks manufacturer, Cott Corp, and Canadian based brewer, Molson Coors, have also reported a drop in earnings, with the former announcing a loss of CAD152.8mn (US$124mn) for FY08 and the latter a drop in earnings of 22% to CAD416.4mn (US$338mn) for the same period. In addition to the general economic conditions, it is thought that Cott Corp’s poor performance is likely to stem from a problem with its strategy and therefore the company needs to refocus its efforts on producing private label soft drinks. In light of the economic downturn, there is likely to be an increased demand for such products thus providing an opportunity for Cott Corp to reverse its fortunes.

Moving to the mass grocery retail sector, the situation is slightly different with many retailers posting positive financial results. Canada’s leading supermarket chain Empire announced that during Q308 net earnings increased 26.5% to CAD61.5mn (US$47.6mn), whilst Canadian retailer Metro Inc reported an increase in net earnings of 9.9% year-on-year (y-o-y) to CAD81.1mn (US$65.9mn) for Q109. As the economic situation worsens, consumers are becoming more price conscious and therefore eating out less, as such retailers are picking up the slack and benefiting from the increase in sales this brings them. However, retailers appear to be mindful of the pressures consumers are facing and Wal-Mart, Loblaw, and Metro have all announced various forms of price promotions this quarter to continue to attract customers.

With Canada’s GDP expected to rebound in 2010 to 2.9% the long-term outlook offers some positivity even if the short-term appears quite bleak. SHOW LESS READ MORE >

Executive Summary

Business Environment

SWOT Analysis

Food

Canada Food Industry SWOT

Drink

Canada Drink Industry SWOT

Mass Grocery Retail

Canada Mass Grocery Retail Industry SWOT

Macroeconomic Outlook

Table: Canada - Economic Activity

Food

Industry Forecast Scenario

Food Consumption

Table: Canada Food Consumption Indicators - Historical Data & Forecasts

Confectionery

Table: Confectionery Value/Volume Sales - Historical Data & Forecasts

Canned Food

Table: Canned Food Value/Volume Sales - Historical Data & Forecasts

Trade

Table: Food & Drink Trade Balance - Historical Data & Forecasts

Industry Developments

Market Overview

Food Processing

Food Consumption

Organics

Confectionery

Canned Food

Trade

Dairy

Drink

Industry Forecast Scenario

Alcoholic Drinks

Table: Alcoholic Drink Value/Volume Sales - Historical Data & Forecasts

Hot Drinks

Table: Hot Drink Value Sales - Historical Data & Forecasts

Soft Drinks

Table: Soft Drink Value Sales - Historical Data & Forecasts

Industry Developments

Market Overview

Alcoholic Drinks

Beer

Wine

Hot Drinks

Soft Drinks

Mass Grocery Retail

Industry Forecast Scenario

Table: Canada Mass Grocery Retail - Value Sales by Format - Historical Data & Forecasts

Industry Developments

Market Overview

Main Players

Table: Structure of Canada's Mass Grocery Retail Sector by Number of Outlets

Table: Structure of Canada's Mass Grocery Retail Sector - Sales by Format (US$bn)

Sales Breakdown by Retail Format Type

Competitive Landscape

Key Players

Food and Drink

Table - Key Players in Canada's Food & Beverage Sectors

Mass Grocery Retail

Table: Key Players in Canada's Mass Grocery Retail Industry

Company Analysis

Food

Saputo

George Weston Ltd

Maple Leaf Foods

Drink

Corby Distilleries Ltd

Mass Grocery Retail

Loblaw Companies Ltd

Metro Inc

Sobeys.

Wal-Mart

Appendix

Country Snapshot: Canada Demographic Data

Section 1: Population

Table: Demographic Indicators, 2005-2030

Table: Rural/Urban Breakdown, 2005-2030

Section 2: Education and Healthcare

Table: Education, 2000-2003

Table: Vital Statistics, 2005-2030

Section 3: Labour Market and Spending Power

Table: Employment Indicators, 2001-2006.

Table: Consumer Expenditure, 2000-2012 (US$)

Table: Average Annual Manufactuing Wages, 2000-2012

BMI Food & Drink Industry Glossary

Food & Drink

Mass Grocery Retail

BMI Food & Drink Forecasting & Sourcing

How We Generate Our Industry Forecasts

Sourcing