South America Pasta and Noodles Market - Growth, Trends, COVID-19 Impact, and Forecasts (2023-2028)

The South American pasta and noodles market is projected to register a CAGR of 3% during the forecast period.

The COVID-19 pandemic significantly affected the market. This was because consumers were locked in their homes, due to which the consumption of ready-to-eat products drastically increased. Pasta's extended shelf life made it a popular choice for consumers looking to stockpile when stay-at-home orders lingered longer than a few weeks. According to the annual report of Barilla America Inc., America's largest producer of spaghetti/macaroni/pasta, sales accounted for USD 644 million in 2020, up 3.2% from 2019.

With the rising work culture, consumers are moving toward foods that can be consumed with convenience and require lesser time to prepare. For instance, in Argentina, the total labor force accounted for 20.9 million in 2021, while in 2020, it was 19.2 million. The urbanized population, due to their hectic schedules and higher discretionary spending, drives the market for pasta and noodles. The availability, accessibility, affordability, and flexibility associated with the consumption of pasta and noodles further drive the market's growth.

Packet noodles are the most common type of noodles that are consumed worldwide. It comes with reasonable pricing and is easy to prepare. Further, packet noodles are convenient to carry and are cheaper when purchased in high volumes. This makes its purchase profitable for users like cafes, canteens, families, and others. Also, these noodles are preferred during gatherings, birthdays, and other occasions. Thus, the demand for noodles is rising and driving the market.

South America Pasta & Noodles Market Trends

Increasing Demand for Organic or 'Free-from' Pasta and Noodles

The increase in demand for gluten-free, clean-label products has boosted the marketplace for gluten-free pasta and noodles. It has been stated that a majority of consumers are choosing the 'free-from' idea to include a balanced lifestyle. Millions of people in South America have commenced ingesting gluten-free products not only because of celiac disease but also due to a trendy notion of retaining or maintaining good health. Thus, companies involved in pasta and noodles production have taken initiatives to invest in the development of native technologies in order to gain consumers' attention. For instance, in June 2021, Argentina's National University of Patagonia San Juan Bosco, after obtaining financing of USD 740,000, developed noodles made of algae that shall taste like squid. These are noodles with a 30% substitution of wheat flour for algae, which achieves the manufacture of “pasta” with 14% fewer calories, 16% fewer lipids, 23% fewer carbohydrates, 65% more minerals, 12% more proteins, and 158% more fiber than traditional ones.

Consumption of packaged meals amongst millennials and Gen-Zs in South America is one of the key elements facilitating the boom of gluten-free pasta. With the developing fitness consciousness, the demand for food products with nutritional benefits is increasing, which is propelling the growth of gluten-free pasta in South America.

Supermarket/Hypermarket Holds a Prominent Share

The distribution channels in the South American pasta and noodles market include hypermarkets and supermarkets, convenience stores, online retail stores, and other distribution channels. Hypermarkets and supermarkets are the leading distribution channels in the South American pasta and noodles market. The wide product visibility at supermarkets/hypermarkets further boosts the consumer base, leading to escalated sales. Acts such as business expansions and the rising number of hypermarkets and supermarkets add to the sales of these retail formats and significantly contribute to the market's growth​. For instance, in March 2021, Carrefour SA bought Walmart Inc.’s former Brazil unit to cement its position as the country’s largest supermarket operator.

According to a survey by Associação Brasileira de Supermercados, Grupo Pão de Açúcar (GPA) owned 809 retail food stores in 2021, making it the second company with the highest number of establishments in the Brazilian industry, right after AM/PM Comestíveis Ltda.

South America Pasta & Noodles Market Competitor Analysis

The pasta and noodles market is highly competitive in nature, with many regional and international competitors operating in the market. The major players are General Mills Inc., the Kraft Heinz Company, Barilla Holding SpA, BRF SA, and M. Dias Branco SA. Companies compete based on different factors, including product offerings, quality, taste, flavors, price, functionality, size, packaging, and marketing activities, in order to gain a competitive advantage in the market.

Key players are now focusing on social media platforms and online distribution channels for the online marketing and branding of their products to attract more customers. Major players focus extensively on providing consumers with innovative and exotic flavors as well as attractive packaging. The sustainable competitive advantage through innovation is resulting in the growth of the market share of major players worldwide. For instance, in August 2020, Productos Fernandez in Chile launched a pasta line.

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