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Snack sales boom in Chile sparks calls for investment

By Oliver Nieburg , 29-Nov-2011

Photo credit: Flickr - erjkprunczyk
Photo credit: Flickr - erjkprunczyk

Chile has achieved record snack sales in 2010 leading a pro-Chile group and a market analyst to say there could be potential for food manufacturers to tap into high domestic demand for functional foods.

ProChlie, the export promotion bureau of the Government of Chile and a market analyst from Mintel told BakeryAndSnacks.com about prospects for food companies in healthy snacks as the Chilean snacks industry recorded sales of $256m (€191m) in 2010, its highest ever.

Healthy snacks

Sebastian Concha, an analyst for Mintel based in Santiago, told this site: “As in most countries in Latin America, snacks still have a large potential in Chile.”

“Most food and drink categories had a positive performance in Chile during 2010 and are expected to have a good 2011 as well. The economy has been growing and bakery and snack are accessible indulgence for lower and mid income families,” he said.

Cristián López the director of ProChile, London said: “The potential of what Chile can offer lies in healthy snacks or those with added value.”

He gave the examples of healthy snack companies like Tika Chips, Nutra-Bien, Sur Fruit and CCU’s Calaf brand that had been experiencing strong sales.

“These are sectors that are currently being developed in Chile because of the global trend towards eating healthier foods with lower sodium levels, and which at the same time offer preventative health benefits,” he said.

Concha from Mintel added: “Breden Master is a good example of a success story in bakery, as they run almost alone in the industrial and food service supply of bakery. While they do have some presence on retail, this is an area that is almost non-existent in the country (frozen bread, etc.) and while it holds a big potential it will require a strong investment to make sure people understand their offer.”

Key export markets for Chile include Mexico, Venezuela, Bolivia, Paraguay, Ecuador and Cuba, countries which at the moment “prefer conventional snacks”, according to López.

ProChile said total food exports from Chile amounted to around $12bn (€8.9bn) per year.

Barriers

Concha said the big players in the snacks market included Pepsico and Watt’s, but independent bakeries were also performing well.

“Bakery in particular is dominated by small corner bakeries offering bread and pastries that are consumed in record levels in the country,” he said.

“Bakery will see, with the continued extension of supermarkets and smaller formats, an increasing challenge to smaller and fragmented neighborhood bakeries,” he continued.

He added that the main barrier for the sector was the possible increase in regulation toward ‘junk food’ by through laws designed to tackle obesity.

ProChile is hosting the private talk on Investment Opportunities in the Food Industry in London on 7 December.

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