United Kingdom frozen food market: £5 billion industry in 2012

Press Release   •   Feb 19, 2013 17:20 GMT

Iglo Birds Eye Frozen Foods is expected to lead the United Kingdom frozen food market, with 13% share of value sales in 2012. Birds Eye has one of the widest ranges of frozen foods available in the UK market, including fish, vegetables, chicken, red meat, frozen meals, pies, potatoes and desserts. Birds Eye makes its branding message clear by stating "Fresh Frozen Food". The word "fresh" appears repeatedly on its packaging and on its website. Although the company holds a dominating lead in this sector, it has suffered repeated falls in value share as a result of the encroachment of private label in this area.

In general, frozen food has been adversely affected by global inflation and the higher costs of food and food processing. Meat in particular has become expensive and this has meant that margins are much tighter in this category than previously. The only declines in frozen foods in 2012 will come from frozen bakery products and frozen desserts, however, as well as frozen meat substitutes. Frozen desserts has seen a steep rise in prices which may have frightened off some consumers. It is also regarded as a luxury category, and therefore can easily be cut from the household shopping list when the consumer is looking to make savings. Frozen bakery has declined as consumers have continued to stick to fresh bakery and are perhaps doing more of their own home freezing of fresh bakery products.

Frozen food is expected to grow by 1% in volume terms between 2012 and 2017, but to see virtually static value growth in the same period. Frozen food has benefited in part from the economic downturn and may be able to hold on to some of these consumers as the economy picks up from 2013 onwards. However, the frozen food sector is still suffering from an image problem at the moment and is facing competition on many fronts, in particular from ready meals and from chilled foods which have recently been developing into areas traditionally held exclusively by frozen foods. It is therefore unlikely that growth can be maintained over the forecast period.

Key Headlines

- Frozen processed food grows by 2% to reach £4.7 billion in 2012
- Growth continues to be hampered due to aggressive price cutting in this sector
- Reduced fat frozen processed food sees the highest growth at a rate of 11%
- The unit price increases to £3.09 in 2012
- Igloo Bird's Eye Frozen Foods ranks number one with a 13% value share in 2012
- Frozen processed food is forecast to grow negligibly across the forecast period

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