The value of China’s ice cream sector is set to grow by more than US$1bn in the next three years despite falling per capita consumption, according to research.

GlobalData, the London-headquartered research and analysis organisation, suggests by 2023 the market will be worth CNY59.3bn (US$8.8bn), compared to CNY49.8bn in 2018.

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That is an increase of more than $1bn and amounts to an annual growth rate (CAGR) of 3.5%.

The report – China Ice Cream – Market assessment and Forecasts to 2023 – says that, in volume terms, the sector is expected to grow from 2,260m kg in 2018 to 2,267m kg by 2023.

However, per capita consumption of ice cream in China, which stood at 1.62kg in 2018, is expected to decline and reach 1.59kg by 2023.

In 2018, impulse ice cream – single-serve was the largest category with value sales of CNY40bn. However, the artisanal ice cream category is forecast to register the fastest value growth at a CAGR of 4.2% in the period covering 2018 to 2023. It will be followed by take-home and bulk ice cream and impulse ice cream – single serve with CAGRs of 3.53% and 3.49%, respectively.

Impulse ice cream – single serve was also the largest category in volume terms, with volume sales of 1,811.9m kg in 2018. However, the take-home and bulk ice cream category is forecast to register the fastest volume growth at a CAGR of 0.13% during 2018-2023, followed by artisanal ice cream (0.06%) and impulse ice cream – single-serve (0.05%).

In terms of product distribution, convenience stores has been the largest distribution channel in the Chinese ice cream sector. It accounted for a value share of 45.3% in 2018, followed by food & drinks specialists and hypermarkets & supermarkets with shares of 27.7% and 26.2%, respectively.

Yili Group, Unilever and China Mengniu Dairy are the top three companies in the Chinese ice cream sector by market share. Yili Group accounted for a value share of 11.9% in 2018, while Anglo-Dutch consumer goods giant Unilever and China Mengniu Dairy held shares of 9.3% and 5.8%, respectively.

The trend towards better-for-you ice cream seen elsewhere in the world is expected to have an impact on China between now and 2023, GlobalData –’s parent company – suggests.

Health and wellness attributes such as ‘food minus’ and consumer benefits such as weight and shape management are expected to contribute the most towards the growth of the health & wellness market in the Chinese ice cream sector during 2018–2023, its report said.

Sales of take-home and bulk ice cream with health and wellness claims are forecast to grow at a CAGR of 3.6% during 2018-2023.