ROCKVILLE, MD. — While North America may have the largest share of the breakfast cereal market, its dominance is slowly being challenged by Asia, Europe and Africa, according to a new report from market research firm Packaged Facts.

In its ”Global Breakfast Cereals” report, Packaged Facts said the global breakfast cereal market is forecast to expand 3% per year to $40 billion by 2023, led primarily by sales growth outside of North America.

Packaged Facts said North America accounted for $12 billion of the $35 billion global breakfast cereal market in 2018. The region has the highest penetration of breakfast cereals in the world, with per capita consumption of both hot and ready-to-eat cereals exceeding that of other regions. But increasingly busy lifestyles and a plethora of other breakfast options have contributed to a decline in per capita consumption in recent years, the report noted.

As a result, Asia, Europe and Africa — regions where breakfast cereal sales are growing at rates outpacing the United States and Canada — are slowly gaining ground. The United Kingdom and Australia are the only two regions that have breakfast cereal consumption rates that currently approach those of the United States and Canada, according to Packaged Facts.

“While breakfast cereal penetration is much lower in the rest of the world, consumption rates are rising as cereal companies target these areas,” said David Sprinkle, research director at Packaged Facts. “In these nations, instead of breakfast cereals being an entrenched product that competes with new breakfast options, cereals are being introduced as an alternative to traditional fare. The Westernization of the diet in many of these areas also makes breakfast cereals a novel and enticing food option.”

To prevent breakfast cereal sales from eroding further, Packaged Facts has identified six trends cereal makers are focused on.

  • Harvesting a health halo. Companies are using healthier ingredients, including ancient grains, seeds and nuts, and are adding pro-health ingredients such as probiotics and prebiotics.
  • Creating novel flavors. Limited-time flavors such as maple bacon donut and chicken and waffles are being introduced that can offer one-off sales. Post Maple Bacon Donut cereal and Honey-Maid S'mores Cereal
  • Marketing cereal beyond breakfast. Companies such as Post Holdings (through its "Dream Cereals" product line) are repositioning cereal as a snack or dessert instead of strictly a breakfast food.
  • Capitalizing on convenience. More companies are introducing single-serve packaging to encourage on-the-go consumption.
  • Adding value with add-in ingredients. Companies are including fruit, nuts and other add-in ingredients in separate packaging for inclusion in the cereal.
  • Paying attention to packaging. The presence of enhanced packaging components, including smart labels, is allowing more interaction with consumers and serving to enhance the breakfast experience.