Canada's Latest Food Manufacturing and Food Services Industry - PowerPoint PPT Presentation

Canada's Latest Food Manufacturing and Food Services Industry Outlook Jean-Charles Le Vallée, PhD Associate Director, Centre for Food & Food Horizons Network The Conference Board of Canada May 4, 2017 – SIAL Toronto @CBoC_Food conferenceboard.ca

Outline. • Introduction to the Centre for Food –plus Canada’s Food Performance • Canadian Consumers • Trade Indicators • Food Manufacturing • Food Services • 6 th Annual Canadian Food & Drink Summit – Calgary, December 5-6, TELUS Convention Centre 2

The Centre for Food. 3

Advanced Food Performance Monitoring and Reporting Expertise. • International and domestic comparisons. • Food industry performance. • Benchmarking. • Third-party monitoring. • Food policy analysis. 4

The Canadian Food Strategy. -Launched March 2014. -20+ Research Reports. -3 Summits (1500 participants). -Nation-wide Consultations with Industry, Government & Canadians (2000 responses). - 2 National Surveys with Industry and consumers (2200 responses). - 5 themes, 8 goals, 62 desired outcomes. 5

Guided by Five Strategic Food Themes. 6

25+ Research Reports. 7

Global Report Card on Food Performance. • 17 OECD countries. • For Canada: • Food Safety: A • Health & Diets: B • Food Security: B • Industry Prosperity: B- • Environmental Sustainability: C+ 8

2014 World Ranking of Food Safety Performance. • Evaluates and ranks common elements among global food safety systems. • 17 OECD countries. • 10 performance indicators. • 3 food safety risk governance domains: assessment, management, and communication. 9

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2017 Provincial Food Report Card. 12

2017 Provincial Food Report Card. 13

Presentation Outline. • Centre for Food • Canadian Consumers • Trade Indicators • Food Manufacturing • Food Services • 6 th Annual Canadian Food & Drink Summit – Calgary, December 5-6, TELUS Convention Centre 14

Consumer Attitudes Vary Widely by Province. Index of Consumer Confidence, year-over-year per cent change, 2016 Atlantic Provinces Quebec British Columbia Saskatchewan-Manitoba Canada Ontario Alberta -50 -40 -30 -20 -10 0 10 20 Source: The Conference Board of Canada. 15

Food Inflation Has Been Strong. Consumer prices for select products, year-over-year per cent change, 2015 Meat Vegetables Fruit, fruit preparations and nuts All Food Food purchased from restaurants Bakery and cereal products Fish Dairy products 0 1 2 3 4 5 6 7 8 Sources: Statistics Canada; The Conference Board of Canada 16

Food Sales Remain Steady. Retail sales index Jan. 2010=100 All Retail Food and Beverage Stores 130 120 110 100 90 2010 11 12 13 14 15 16 Sources: Statistics Canada; The Conference Board of Canada. 17

Annual Canadian Household Expenditures. 18

Average Annual Food & Beverage Expenditures. 19

Debt Burdens Are a Concern. share of disposable income used to service debt, per cent 16 15 14 13 12 11 10 1990 92 94 96 98 00 02 04 06 08 10 12 14 Source: Statistics Canada. 20

Growth in Real Spending on Food and Beverages Softening. real spending on food and non-alcoholic beverages, per cent change 2,0 1,5 1,0 0,5 0,0 -0,5 2006 07 08 09 10 11 12 13 14 15 16 Sources: The Conference Board of Canada; Statistics Canada. f = forecast 21

Consumer Tastes Can Change. per capita meat consumption, kg/year 60 50 40 Chicken 30 Pork Beef 20 10 0 1960 65 70 75 80 85 90 95 00 05 10 Source: Statistics Canada; The Conference Board of Canada. 22

Drop in Liquid Refreshment Beverage Consumption. 23

Outline. • Centre for Food • Canadian Consumers • Trade Indicators • Food Manufacturing • Food Services • 6 th Annual Canadian Food & Drink Summit – Calgary, December 5-6, TELUS Convention Centre 24

Population Growth Will be Strongest in Emerging Markets. increase in population 2014-2024, millions More developed Least regions; 27 developed regions; 237 Less developed regions; 537 Source: UN population database. 25

Proteins Are the Key Area for Demand Growth. average annual growth in per capita demand, 2014-2024, per cent Vegetable oils Fish Developed countries Dairy Meat Other developing countries Other Least developed countries Sugar Cereals -5 0 5 10 Source: OECD-FAO. 26

Exports Account for Significant Share of Industry Sales. share of 2015 sales, per cent 69 Domestic United States 23 China 31 Japan 2 2 Other 5 Exports Sources: The Conference Board of Canada; Statistics Canada; Industry Canada. 27

Real Exports of Food Products Continue to Climb, While Imports Have Stagnated. exports and imports of food products, $ billions 2007 Exports Imports 22 20 18 16 14 12 10 2004 05 06 07 08 09 10 11 12 13 14 15 Sources: The Conference Board of Canada; Industry Canada. 28

Export-Intensive Segments Should Benefit Most From a Weaker Currency. share of 2015 manufacturing shipments exported, per cent Fruit and Vegetable Seafood Products Manufacturing Sugar and Confectionery Grain and Oilseed Food Manufacturing Bakeries and Tortilla Meat Products Animal Food Dairy Products 0 10 20 30 40 50 60 70 Sources: Industry Canada; The Conference Board of Canada 29

Outline. • Centre for Food • Canadian Consumers • Trade Indicators • Food Manufacturing • Food Services • 6 th Annual Canadian Food & Drink Summit – Calgary, December 5-6, TELUS Convention Centre 30

About the Canadian Food Manufacturing Industry. 31

Breakdown by Food Manufacturing Subsector. 32

Food Manufacturing Distribution by Province. 33

Food Manufacturing by Segment. share of GDP, 2015 Other Food; 15 Meat Products; 25 Sugar and Confectionery; 5 Seafood Products; 5 Animal Food, 6 Dairy Products; 13 Fruit and Vegetable ; 9 Grain and Bakeries and Oilseed; 11 Tortilla; 12 Sources: The Conference Board of Canada; Statistics Canada. 34

Seafood Product Manufacturing Expected to Remain Industry Growth Leader Near Term. GDP, per cent change 2013 – 15 2015 – 17f Seafood Other food Bakeries and tortilla Grain and oilseed Sugar and confectionary Food Manufacturing Average Animal food Dairy Meat Fruit and vegetable -2 0 2 4 6 8 10 12 Sources: The Conference Board of Canada; Statistics Canada. 35

Entering Canada’s Next Trade Era. • Canadian economy is entering a new trade era characterized by: – lower commodity prices – a weaker Canadian dollar – strengthening demand from south of the border. • Food manufacturing among the very few manufacturing industries that are poised for success in upcoming trade era. • Geographic advantage and a strong food safety record. 36

Food Manufacturing Exports to EU. 37

Food Processed Imports from EU. 38

Outline. • Centre for Food • Canadian Consumers • Trade Indicators • Food Manufacturing • Food Services • 6 th Annual Canadian Food & Drink Summit – Calgary, December 5-6, TELUS Convention Centre 39

About the Canadian Food Services Industry. 40

Food Service Industry Distribution by Province. 41

Food Service Industry Breakdown by Segment. 42

Food Service Industry Profit Margins. 43

Restaurant Prices. 44

Summary. • Canadian consumer will be hard pressed to increase their current pace of spending. • Food manufacturing industry less sensitive to economic conditions than other industries. • Food service industry sensitive to elevated consumer debt and aging population who may dine more at home and spend less eating out. • Weak growth in domestic consumer spending on food means that exports will be a key source of growth. • The U.S. recovery, weakness of the Canadian dollar, and trade agreements offer opportunities for industry. 45

6 th Annual Canadian Food & Drink Summit. • December 5-6, Calgary TELUS Convention Centre • 200+ delegates, high profile speakers • Explore the future of Canada’s food sector, and leverage new opportunities to enhance the food sector’s performance — both provincially and globally • Sponsorships, panel speakers, exhibits available • Current food industry topics; healthy food and diets; food safety; sustainability; and food security • conferenceboard.ca/conf/foodsummit/ 46

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