New Zealand Sugar Market - Forecasts from 2022 to 2027

The New Zealand sugar market was valued at US$218.580 million in 2020 and is expected to grow at a CAGR of 1.57% over the forecast period to reach a market size of US$243.756 million in 2027.

Sugar is obtained from either extracting the sugar beet or sugar cane plant, after that it can be made into different forms. Many industries these days are increasingly using sugar for different purposes such as bakery, confectionery, canned food, frozen foods, pharmaceuticals, and so on. Also, many people consume a lot of sweet dishes and desserts so the demand for sugar is more which will augment the market growth. Additionally, increasing investment and product innovation by major players coupled with new product launches may further bolster the growth of the market.

Online channels to grow substantially

According to ecommerceDB in 2020, the eCommerce sector in New Zealand was valued at a figure of US$2 billion. Food and personal care were witnessed to be the largest category based on sales followed by shoes, consumer electronics and household appliances. Further, the presence of International E-commerce platforms including Amazon, eBay, and Alibaba in the country is very well-known to local purchasers. Thus, due to a huge e-commerce industry in the country, along with well-established players, online channels of distribution are expected to grow significantly in the forecast period. Further, in New Zealand, even most of the bricks and mortar retailers offer an online presence as well. TheMarket.com is a local platform which focuses on international and domestic FMCG products. Additionally, the government of New Zealand offers advice through a number of websites to support local businesses develop their online presence. This support of the federal government is thus further expected to drive online sales in the market.

Further, according to DataReportal, there were about 4.63 million internet users in New Zealand in January 2022, showing an increase of 1.7% between 2021 and 2022. Further, according to the data, internet penetration in the country stood at 86.9% in January 2022, with the number of mobile connections at a staggering 131.2% of the total population. Thus, this growing internet population in the country is further projected to drive the online channel of distribution in the projection period.

Restraints

People in the country have been experiencing a shift in their eating habits and growing diet consciousness, thus decreasing their sugar intake. This factor is expected to constrain the growth of the market. According to data by Google in 2019, New Zealand was found to be the 4th most diet-conscious country across the entire globe. Due to this factor, the Ministry of Health, of the country has been contemplating the feasibility of a sugar tax which would be applied to sugary products, in an effort to decrease their consumption and promote healthy dietary habits. If the government implements a tax like such, it is expected to act as a restraint towards the New Zealand sugar market.

COVID-19

The outbreak of the COVID-19 pandemic affected the market negatively. The pandemic resulted in the implementation of nationwide lockdowns and social distancing measures in the country, which affected the production, as well as the distribution of the crops to obtain sugar. Further, the lockdowns also mandated the shutdown of offline retail stores in the country, which are still a major source of distribution, thus making the market dip even further. However, the COVID-19 national and regional lockdowns in the country in 2020-21 spurred New Zealand consumers to increase their online spending, urging approximately 70% of New Zealand’s population to buy online, according to the ITA (International Trade Association). This development helped the sales of products through online channels of distribution, which helped in providing some growth to the market at a time like that.

Market Segmentation:

By Form

• Granulated
• Powdered
• Syrup

By Source

• Cane Sugar
• Beet Sugar

By Use

• Food and Beverage
• Pharmaceuticals

By Distribution Channel

• Online
• Offline