27 May, 2020 Global meat industry to decline by 5.3% to US$1.3 trillion in 2020 due to COVID-19 pandemicPosted in Consumer
The activity of meat manufacturers across North America continues to generate a lot of noise, with some processing plants from major companies such as Tyson and JBS resuming operations. Continued turbulence among meat packing players is likely to damage consumers’ trust in associated food products, says GlobalData, a leading data and analytics company.
According to the company’s latest COVID-19 adjusted forecasts, the global meat market will value US$1.3 trillion by the end of 2020, reflecting a year-on-year (YoY) decline of 5.3%*. This is a stark contrast to the expected robust baseline growth the industry was experiencing pre-pandemic. Prior to COVID, the global meat industry was expected to grow at an annual rate of 2.6% over 2020 to reach a value of $1.4 trillion**.
Carmen Bryan, Consumer Analyst at GlobalData, comments: “Meat is a staple food in many cultures worldwide, thus the global downturn is evident of the current uncertainty and supply disruptions many markets are facing. Although production will stabilize in the long-term, a full recovery to a pre-COVID-19 value is unlikely.”
COVID-19 is reported to have originated from a wet market in Wuhan, China. As a result, animal-borne diseases have been put under the spotlight, which will influence consumers purchasing habits, particularly in terms of supply and distribution of meat-based products. In fact, 85% of global consumers are heavily influenced by how trustworthy a product or a service is***.
Bryan continues: “Demand for transparent and clean practices from consumers has gained a lot of traction in recent years, and is leading to significant change across nearly all FMCG markets. A crisis such as this is likely to shape the meat industry off the back of consumer demand, particularly as it involves public health and safety.”
Furthermore, since the virus outbreak, 44% of global respondents admitted that they do not trust products that are made or imported from China at this time****. Meat products in the US could follow a similar trend should the current crisis and infection rate not be quelled.
Bryan adds: “The fast rate of infection that meat processing facilities have exhibited, combined with the seemingly powerlessness from players to stop it, will play into current concerns over meat related diseases and packaging. As a result, some consumers may opt to avoid buying meat products, at least whilst under lockdown. The threat is that, should these challenges persist, it may lead to new buying behaviors, with consumers increasingly turning to meat alternatives, and sticking with them in the long-term.”