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Cereal Production in Canada Industry Market Research Report from IBISWorld Has Been Updated
Date:7/19/2014

New York, NY (PRWEB) July 19, 2014

Conflicting trends over the past five years hampered the Cereal Production industry. Wary of the economy, many turned to cereal as an inexpensive breakfast option. In 2009, however, revenue dropped due to a flood of US imports, followed by the consumer shift to pricier breakfasts as disposable incomes recovered. Moreover, as people returned to work they had less time to prepare breakfast. Instead, Canadians opted to buying food at cafes or coffee shops, decreasing demand for cereal. However, by 2012, households had evened out spending to include branded and more expensive healthy cereals. This trend is expected to lift revenue in 2014. Overall, revenue is expected to fall over the five years to 2014.

According to IBISWorld Industry Analyst Britanny Carter, “profit has proved volatile over the past five years due to fluctuations in commodity prices.” For example, the price of wheat dropped in 2009 only to surge over 2011. Other major industry inputs, including barley, sugar and corn, experienced similar price jumps due to supply shocks. Although unable to fully pass on these cost hikes to price-conscious consumers, industry profit margins are expected to grow slightly due to improved demand conditions for price-premium cereal. Moreover, smaller operators that have been unable to turn a profit have exited the industry. Consequently, the number of cereal production companies is expected to decline over the five years to 2014.

Over the next five years, recovering disposable income will encourage consumers to purchase brand-name, high-end cereal, which is expected to improve industry returns
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