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Customized Report Services – Canadian meat and beef trends

September 2019

Sector overview – Meat in Canada

The Canadian meat sector based on retail sales (including beef, chicken, lamb, pork, packaged or fresh turkey and other similar meat categories) is expected to grow from US$18.7 billion in 2018 to US$22.2 billion in 2023. Beef represented a retail sales value market share of 29.1% of the overall Canadian retail meat sector in 2018.

In volume terms, the meat sector is expected to grow from 1,461.8 million kg in 2018 to 1,565.6 million kg by 2023, registering a 10-year (2014-2023) compound annual growth rate (CAGR) of 1.7% in Canada. The Canadian meat sector is forecast to register an overall retail value growth of 3.5% and volume growth of 1.3% between the 2019 to 2023 period. In comparison to the United States, the overall value and volume growth within Canada will grow faster, whereby the US holds a significant value (90.7%) and volume (92.3%) share of the meat market in 2018 and the American market is expected to grow by a value of 2.0% and a volume of 1.2% during the same period.

In terms of retail sales, purchasing fresh meat from over the counter was the largest preferred consumer choice, followed by chilled raw packaged and processed meat. Furthermore, frozen meat is expected to be the fastest growing category in volume terms with a CAGR of 2.6%, followed by continued growth in the fresh meat – counter (1.7%) and chilled raw packaged and processed meat (1.7%) during 2018-2023.

Per capita consumption of meat in Canada is higher than the global level (16.7 kilograms) standing at 39.4kg in 2018, yet is lower when compared to the North American regional level (52.1kg) and is expected to reach 40.7 kilograms by 2023. Per capita expenditure of meat in Canada stood at US$594 in 2018, which was higher when compared to both global (US$180.1) and North American regional (US$557.6) averagesFootnote 1.

The top distribution channels in the Canadian meat sector were hypermarkets and supermarkets, accounting for a value share of 72.8% in 2018, followed by food & drinks specialists (20.6%) and convenience stores (4.0%). Key packing material used were rigid plastics by a 65% share.

Retail market in the beef industry

In 2018, the beef industry reached retail sales of US$5.4 billion with volume sales of 298.9 million kilograms within Canada. Beef represented a sales value market share of 29.1% of the overall retail Canadian meat sector, which is equivalent to a retail volume share of 20.4%. This segment category has been increasing at a CAGR of 2.3% from 2014 to 2018 and is expected to continue to expand by a CAGR of 2.4% between 2019 and 2023.

Fresh beef from over-the-counter is the largest category with US$3.3 billion in retail off-trade sales. The "other shelf-stable" beef category, containing products like dried beef jerky, sausage or beef snack sticks, have shown significant growth between the 2014 to 2018 period and is expected to continue increasing by a CAGR of 10.2% from 2019-2023.

In the "meat substitute" industry, soy-based was the top category consisting of 41.9% tofu products such as burgers and grills, meatballs, sausage and other portions (also including any other soy based products other than tofu), which represented total soy based sales of US$102.0 million in 2018. When compared to the entire meat sector with similar products such as burgers and grills, meatball and sausages, the demand for "meat substitute" (plant/based or vegetarian) products was low representing total sales of US$158.9 million in 2018, which held a 0.9% market share. Nevertheless, the sales of "meat substitute" product categories are all growing faster than sales of most meat product categories by CAGRs greater than 8.3% between 2014-2023.

Canadian retail sales of the meat sector – beef, historical and forecast using fixed exchange rates (2018), off-trade sales, US$ millions
Category 2014 2018 CAGR* % 2014-2018 2019 2023 CAGR* % 2019-2023
Meat - beef total 4,968.5 5,439.8 2.3 5,516.2 6,060.3 2.4
Shelf-stable beef 43.9 49.1 2.8 51.1 58.6 3.5
Canned beef 40.3 42.7 1.5 44.1 48.3 2.3
Other shelf-stable beef 3.6 6.3 14.7 6.9 10.3 10.2
Chilled raw packaged beef - processed 610.6 696.5 3.3 717.5 808.0 3.0
Burgers and grills - beef 199.9 229.2 3.5 236.0 266.1 3.1
Coated portions - beef 298.0 338.2 3.2 348.3 391.7 3.0
Meatballs - beef 13.5 15.4 3.3 15.9 17.8 3.0
Sausages - beef 99.1 113.7 3.5 117.3 132.3 3.0
Chilled raw packaged beef - whole cuts 570.4 620.1 2.1 626.5 685.8 2.3
Cooked beef - counter 137.4 152.5 2.6 156.7 176.2 3.0
Cooked beef - packaged 397.1 429.2 2.0 434.3 472.1 2.1
Fresh beef - counter 3,042.0 3,299.6 2.1 3,330.7 3,634.7 2.2
Frozen beef 167.2 192.8 3.6 199.5 225.0 3.0
Processed beef 107.8 124.3 3.6 128.7 145.1 3.0
Whole cuts of beef 59.4 68.5 3.6 70.9 79.9 3.0

Source: GlobalData Intelligence Center: Consumer, 2019

*CAGR: Compound Annual Growth Rate

Canadian retail sales of the "meat substitute" sector, historical and forecast using fixed exchange rates (2018), off-trade sales, US$ millions
Category (segment) 2014 2018 CAGR* % 2014-2018 2019 2023 CAGR* % 2019-2023
Meat substitute total 112.0 158.9 9.1 174.6 245.6 8.9
Grain-based (Seitan, other) 14.4 20.5 9.2 22.4 30.9 8.3
Single cell protein (Fungi - Mycoprotein/algae) 1.5 2.2 11.0 2.5 3.6 9.4
Soy-based (tofu, other) 74.0 102.0 8.3 111.3 153.8 8.4
Vegetable/plant based proteins (legume or pea based, yam/sweet potatoe, other) 22.1 34.2 11.5 38.4 57.3 10.6

Source: GlobalData Intelligence Center: Consumer, 2019

*CAGR: Compound Annual Growth Rate

Foodservice distribution of beef (on-trade)

The beef foodservice industry in Canada pulled in US$2.6 billion in 2018, which includes the on-trade of beef varieties such as burgers and grills, meatballs, ribs, sausages and other beef products. Foodservice profit operators selling beef products represented 87.0% of the market share distributed mainly in the restaurant services, while institutional non-profit operators held the remaining market share of 13.0% distributed mainly in the education services in 2018.

Distribution channels of the Canadian beef sector by outlet type, sales value in US$, volume (millionss of kilograms) and market share (%) in 2018
Distribution channel type OBP* sales value (US$ millions) OBP* volume (million kg) Market share %
Foodservice (profit operators) 2,286.2 236.7 87.0
Accommodation 137.0 14.1 5.2
Leisure 43.9 4.6 1.7
Mobile operator 16.1 1.6 0.6
Pub, club and bar 20.8 2.1 0.8
Restaurant 1,961.6 203.2 74.6
Retail foodservice providers 40.3 4.1 1.5
Travel 21.9 2.3 0.8
Workplace 44.7 4.6 1.7
Institutional (cost operators) 342.6 35.2 13.0
Complementary services 2.5 0.2 0.1
Education 221.0 22.8 8.4
Healthcare 76.2 7.9 2.9
Military and civil defence 22.4 2.3 0.9
Welfare and services 20.5 2.1 0.8
Beef foodservice total 2,628.8 271.9 100.0

Source: GlobalData Intelligence Center - Consumer, 2019

*OBP: Operator Buying Price

Competitive landscape in the meat sector and beef industry

Leading brands in the meat sector in 2018 include Maple Leaf (10.3%) value share, Schneiders (5.2%) Marcangelo (2.3%), and Lilydale (2.2%). Private labels held a 4.0% market value share within the overall meat sector at a CAGR of 3.7% between 2013 and 2018, whereas 'name-brand' (trademark) brands registered a CAGR of 3.3%.

Schneiders (6.3%) and Marcangelo (4.4%) are brands that are also found within the top 10 leaders in the beef industry, yet private labels (2.9%) and other non-trademark (86.4%) companies represent the bulk of the beef market share by approximately 90% in 2017.

According to GlobalData Intelligence, the frozen meat category is a less diversified category in the Canadian meat sector with the top three brands accounting for a combined value share of 52.9% in 2018. Furthermore, in the packaged cooked meats category, the top three brands accounted for a combined share of 49%. There is high fragmentation among the shelf-stable and cooked meat over the counter categories at a combined share of 17.9% and 12.3%, respectively, in 2018. This is creating opportunity for several privately-labelled products to succeed in the market, where these latter mentioned categories are below the global average share of 33.7% across all meat categories, standing at an average share of 29.1% in 2018.

Leading companies and market shares for beef products in Canada, historical retail value sales in current prices, US$ millions and % breakdown
Category and company name 2014 2015 2016 2017 Market share % in 2017
Chilled raw packaged meat - processed (burgers and grills) 898.8 940.5 980.4 1,025.9 11.8
Others 341.3 361.7 378.1 397.3 4.6
Marcangelo 344.2 356.2 369.5 384.4 4.4
Schneiders 170.0 177.7 186.2 195.7 2.2
Private label 43.4 44.9 46.6 48.5 0.6
Chilled raw packed beef - whole cuts 1,701.3 1,716.3 1,773.1 1,802.8 20.7
Others 1,511.1 1,520.7 1,569.9 1,594.9 18.3
Private label 190.2 195.6 203.2 207.8 2.4
Cooked beef - packaged 974.5 988.2 1,013.8 1,033.6 11.8
Others 713.5 698.4 693.1 682.8 7.8
Schneiders 261.0 289.8 320.7 350.7 4.0
Fresh beef - counter 4,585.0 4,631.8 4,776.6 4,859.8 55.7
Others 4,585.0 4,631.8 4,776.6 4,859.8 55.7
Beef total 8,159.6 8,276.9 8,544.0 8,722.1 100.0
Source: GlobalData Intelligence Center - Consumer, 2019

Canadian and global consumption trends

According to global survey results, Canada follows closely with several meat consumption trends whereby females are more likely than men to limit their intake or replace meat with plant-based alternatives. The consumption of meat is slightly higher among males by 51.6% and 48.4% women. Survey results show that older consumers (55+ years) accounted for the highest consumption of meat with a 35.4% volume share in 2016. Generally, consumers (45+ years) are most likely to stick to familiar brands.

Meat with 'food minus' product attributes are expected to significantly contribute to the increased growth within the health and wellness sector with retail sales value expected to reach approximately US$381.6 million from 2018-2023. Other important claims on meat products such as 'weight and shape management', 'food intolerance', 'free from', 'health management' or 'general well-being' consumer benefits are expected to contribute to a combined total of approximately US$645.2 million during the same period.

Growth for deli meat in Europe was below the global average of 4% from 2013 to 2018, which was somewhat due to the strong and growing demand in China. Fastest-growing European markets with CAGRs from 2013-18 include Sweden (5.8%), Italy (4.8%), Switzerland (4%), Austria (3%) and the UK (2.6%).Footnote 2

Results from a 2014 European survey, indicate the following consumer trendsFootnote 2:

Product launch analysis of beef and meat trends

According to Mintel, there were 1,674 beef products launched in Canada compared to 5,060 beef products launched in the United States (US) between the period of January 2014 to June 2019. In North America, 62.3% of these beef products were either new product launches or of new variety/range extensions. Tailoring to opportunities such as using smartphone apps, positioning claims on meat as sports nutritional products, and using online subscription services appeal to premium consumers.

There are five main trends in processed meat that were identified in a reported European survey in 2014:Footnote 2

Convenience

Many consumers are time-poor and require packaging formats that make meat preparation and consumption easier. About 37% rely heavily on time-saving products and services and 38% claim that they would not have time to read food labels when shopping. Consumers like easy to open, re-closable packaging. Including utensils within packaging for ready-to-eat products is also a convenient trend. About 13% of consumers cook an evening meal from scratch every day and an additional 29% claim that they cook a meal from scratch almost every day. The remaining 58% of consumers cook from scratch either a couple of times a week, once a week or less often.

Clean labeling

Resonating highly with consumers is the presence of clean labels on meat products that claim to contain natural ingredients and/or that come from a trusted and traceable source. Food safety issues often impact consumer confidence in the meat market where between 20-30% of survey responders say that they distrust claims about ingredients and manufacturing methods used and that consumers often distrust efforts made by retailers to ensure that the 'farm-to-plate' supply chain in production is safe for consumption.

Known product scandals include the labelling claiming that the beef product contained 'lean, finely textured beef', where instead critics in the media dubbed as "Pink slime" (US, 2012); horse DNA found in processed meat products and ready meals (Europe, 2013), and a McDonald's scare where the company was accused of falsifying sell-by dates on expired meat (China, 2014). As a result, manufacturers should be prepared for consumers to increasingly scrutinize the safety standards of meat they purchase as consumers will often conduct their own research instead of relying on manufacturer and retailer claims. 67% of European consumers will pay more for added trust and transparency claims found in premium brands.

Functional (ready-to-eat or 'on the go') protein meat snacks

These snacks go beyond the meat aisles and appeal to more than just athletes and weight trainers. Offering these products in convenience stores or other readily available distribution channels, helps to encourage impulse purchases. An average of 58% of high meat consumers in Europe find new and exotic flavors appealing like President's Choice bacon marmalade (made in Canada) and Hommond's Pigs N' Taters milk chocolate bar with crispy bacon bits and potato chips (made in the United Kingdom). A bacon sundae as a desert is popular in the US sold at Burger King.

Online Subscriptions

Straight to your door delivery through online service subscriptions offers ultimate convenience and tailoring to consumer's personal tastes. Also, offering dietary preferences along with healthy snack box options are positive opportunities.

Meat flavors

A variety of new meat flavors are entering the energy drink category like the 'Cue currywurst-style energy drink'.

Number of beef products launched in North America, total product item count (6,734), historical (January 2014-June 2019)
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2014 2015 2016 2017 2018 2019 (January-June)
United States (5,060) 1,000 720 896 1,004 1,098 342
Canada (1,674) 437 363 314 259 250 51

Source: Mintel, 2019

Number of beef products launched in North America, by launch type, historical (January 2014-April 2019)
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  • New product: 1,734 (25.7%)
  • New variety / range extension: 2,467 (36.6%)
  • New packaging: 1,997 (29.7%)
  • New formulation: 69 (1.0%)
  • Relaunch: 467 (6.9%)

Source: Mintel, 2019

Number of beef products launched in North America, by country and launch type, historical (January 2014-April 2019)
Country New product New variety / range extension New packaging New formulation Relaunch
Canada 420 587 554 17 96
United States 1,314 1,880 1,443 52 371
Total 1,734 2,467 1,997 69 467
Source: Mintel, 2019

Resources

Customized Report Services – Canadian meat and beef trends
Global Analysis Report

Prepared by: Erin-Ann Chauvin, Senior Market Analyst

© Her Majesty the Queen in Right of Canada, represented by the Minister of Agriculture and Agri-Food (2019).

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