According to new research from IGD, China is set to overtake the US for the first time as the largest grocery market in the world by 2014. IGD analysts forecast that the Chinese grocery market will be worth €761 billion, outstripping the U.S., which is set to be worth €745 billion in four years' time.
IGD says the three top drivers for this change are: The U.S. was more significantly affected by the recession than China; IMF predicts that the Chinese market could grow nearly three times faster than the US over the next four years; and investment and consumer spend has increased in China and private sector demand has been driven by the Government's stimulus package.
Additionally, China's population growth rate is expected to be double that of the US during the period between 2010 and 2014.
Joanne Denney-Finch, chief executive, IGD comments: "Chinese population growth and economic prosperity are contributing to the rise of China as an important grocery market on the world stage. The US and key European markets still offer an important source of growth for food and grocery businesses, but it is becoming harder to ignore the BRIC (Brazil, Russia, India, China) countries.
"Many retailers and manufacturers are already leading the way, building a strong presence in China and other emerging markets. Those who have not yet invested in these markets should start planning ahead now because the pace of growth for emerging markets will continue to outstrip that of the developed world."
IGD also forecasts growth for other BRIC markets with India becoming the third largest food and grocery market in four years' time, while Russia and Brazil rank fifth and sixth respectively. IGD also predicts that Indonesia will enter the top 10 list for the first time.