MANILA -Sales of baked goods in the Philippines are projected to reach $2.5 billion by 2027 amid the steady rise in prices on account of the growing population, according to the US Department of Agriculture (USDA).
The USDA’s Foreign Agricultural Service said sales of baked goods were seen to grow at a compound annual growth rate (CAGR) of 5 percent by 2027, driven by moderate inflation, population growth and urbanization.
In 2022, the retail value of baked products was estimated at $1.9 billion. Of the amount, the industry spent $1.5 billion on ingredients, with more than 75 percent of these imported.
“Traders believe the United States is well-positioned to increase its exports of baking ingredients to the Philippines in the coming years by leveraging the Filipino consumers’ general preference for high-quality US-origin products,” the report said.
The USDA said flour was the most significant import. It accounts for 70 percent of the cost of baking pan de sal, the staple salt bread in the country commonly eaten for breakfast. For other baked goods, flour comprises up to 50 percent of the cost.
“The Philippines does not cultivate wheat, but wheat flour is an important part of its people’s diet,” it said.
In the last five years, exports of milling wheat to the archipelago expanded at a CAGR of 11 percent to nearly $1.3 billion in 2022.
America held 78 percent, equivalent to $1 billion, of the market. Approximately $760 million worth of US wheat entered the baking industry.
The USDA also said fruits, nuts, chocolates and other ingredients accounted for up to 15 percent of local bakers’ costs. INQ