JAMS MARKET IN UKRAINE: SITUATION AND FORECAST

Jam or confit is a jelly-like sweet treat made of fruits or berries. Jam was invented in England around the XIII century. Confitur is considered to be a French variety of jam. Marmalade is a dessert made of fruit cooked with sugar and a thickener that gives it a jelly-like shape. Jam is a Slavic and Transcaucasian dessert. It is made of fruit boiled with sugar. Nuts, rose petals and spices may be added.

The last time the market for canned fruit and berry production showed growth was in 2011. However, the decline in the following years was not too big either. In total , according to the State Statistics Service of Ukraine in 2015, 2153 thousand tons of fruits and berries were harvested (excluding the territory of ATO and ARC). This is slightly more than in 2011 (1896 thousand tons). Data for 2016 have not yet been released by the State Statistics Service.

Classification of jams

Consistency:

• homogeneous (homogeneous);
• heterogeneous (with berry pieces).

By temperature stability:

• thermostable;
• unstable.

By method of packaging:

• sterilized jams, including those packed by “hot bottling” in hermetically sealed containers;
• unsterilized jams packed in small thermoformed hermetically sealed containers;
• unsterilized semi-finished jams packed in large leakproof containers.

Jams and jams production market: raw materials

In Ukraine, orchards occupy 727.2 thousand hectares , and 206 thousand hectares of fruit-bearing plantations (data as of January 1, 2016 from the State Geocadastre). The leader in cultivation of fruit crops is apples. In 2015, their gross yield amounted to 1.18 million tons. They are followed by other stone fruits: cherries, plums, cherries, apricots and peaches. The total harvest of stone fruits in 2015 amounted to 548 thousand tons. Among berries, the first place and most of the volume falls on strawberries and strawberries – a total of 64 thousand tons. Next comes raspberries, currants and gooseberries.

Sugar production in Ukraine is sufficient, it is one of the top sectors of the agro-complex. However, in 2015, sugar production decreased by a third compared to the previous year. Experts say that Ukraine can produce up to 3 million tons of sugar per year. However, this requires modernization of production.

Fruit and berry products market: imports and exports

Below is the schedule of imports and exports of processed products of vegetables, fruits and nuts (UKTVD code – 20) in thousand dollars. Data taken from the website of the State Fiscal Service of Ukraine.

The graph shows that year after year, exports in this category exceed imports. The surplus is beneficial for the economy, but after the peak in 2013, there is a significant decline in exports. This is the impact of the crisis. There is a possibility that the results of total exports in 2016 will be lower than in 2015. However, perhaps the New Year’s Eve months will allow to catch up with the figure of 184152. dollars.

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Analysis of jam consumption and consumer portrait

Consumers of jams are urban dwellers with average and above average income. This is due to the fact that in the rhythm of life in a big city people do not have enough time and desire to preserve products.

The main consumers are women, from 25 to 55 years old. Men also buy jams, but less often. The main factor in choosing confitures and jams is product quality.

Canned sweets belong to the category of spontaneous purchases. Their purchase is influenced by the season. In summer, jams are bought much less often than in winter.

In addition to retail, there are companies that produce jams for HoReCa and for use in the food industry (toppings for baked goods, ice cream, etc.). Seasonality is less important for them. Sales of jams and jams always increase before the Shrovetide holiday.

If you’re in the sweet business, check out our analytical longread on the art of confectionery branding.

Key market players

1. “Veres”. The group of companies has been operating on the Ukrainian market of fruit and vegetable preservation since 1997. Now it is number one among similar Ukrainian producers. Preserves of TM “Veres” can be found in more than 20 countries of the world. The product range includes more than 100 items. The company has a closed cycle of production, which allows to control the quality of products at all stages. Jams are represented by 3 positions: peach, strawberry and apricot, there is also cherry confit and several variations of fruit with sugar (in doy-packs).
2. “Geisyn.” Gaisyn Canning Plant Ltd. is an enterprise that specializes in the production of fruit and berry preserves. The company is the industry leader in the assortment of jams. It has 24 varieties of jams, as well as a variety of jams. The company has products with fructose instead of sugar. It will be of interest to people who care about their health. The manufacturer positions its jams and jams as a premium-class product.
3. “Dari laniv”. The company’s products are manufactured at PJSC “Mogilev-Podolsky Canning Plant”, which is located in Vinnytsia region. Fruits and vegetables are grown there. More than 80 items are produced under TM “Dari laniv”. The company exports products to Belarus, Canada, Hungary, Kazakhstan and Moldova. There are 4 types of jams produced under Dari Lanov TM : currant, apricot, cherry and strawberry jams.
4. “Pani Kristina.” The company has existed since December 1997 and produces products under 3 trademarks. In 2012, a new line of equipment was purchased, after which the production of jams and juices began. The company “Pani Kristina” has its own land on which employees grow vegetables and fruits. Six varieties of jams are produced under “Holiday” TM. The assortment of TM includes unusual flavors (compared to Veres and Dari Laniv): pumpkin and apple-pear.
5. «Тотал». ООО «Тотал» из города Днепропетровска на рынке уже 12 лет. Предприятие производит плодово-ягодные наполнители для кондитерской и молочной отраслей, и разнообразные джемы и топпинги для HoReCa. Также предприятие выпускает джемы в баночках под ТМ «Еммі».
6. “Saffron Elite.” The company has been in existence since 2008. It produces and sells toppings, jams, fillers and syrups for confectionery, dairy and bakery production. Its jams are used as additives/fillers in ice cream, yogurt, smoothies, cheesecakes, confectionery and bakery products.
7. “Askania-Pac.” The national diversified company has been operating in the market since 2002. It is engaged in the production of portioned single-use products. In addition, Askania-Pak is a trader with a wide range of products on the market of flexible packaging materials.
8. “Korisna Konditerska.” “Korisna Konditerska is a new brand on the Ukrainian market. “STEVIYASAN CORPORATION, which produces sweets under the brand name Korisna Konditerska, has existed since 1993. Instead of sugar in their products, manufacturers use stevia. TM has a line of 7 jams, including blueberry and bilberry jams.

Market overview of jams: own brands

Supermarket chains produce their own lines of jams. Nowadays they can be found at every large retailer. For example, for the Furshet chain, jam is produced by Gopak LLC, and for METRO – by Askania-Pak. These products are characterized by a low price and a simple line of flavors (cherry, strawberry, apricot, etc.).

Imported jams

50% of shelves with fruit and vegetable preserves in supermarkets and stores are occupied by imported jams. They cost more expensive than Ukrainian products and stand out with original design. Such jams are designed for customers with high income. Their undoubted advantage is the wide variety of flavors and additives.

Many imported jams do not contain sugar. For example, French St. Dalfour, Italian Bioitalia, German SCHNEEKOPPE, Greek Helios, British JimJams and Wilkin & Sons.

In Ukraine you can buy:

• French Jardin Bio (certified organic jams);
• French Bonne Maman (jams cooked according to traditional recipes);
• Israeli Hadarom (low-sugar jams with a fructose-based line);
• Greek Zolote Yabluko (traditional Greek confitures);
• Georgian Kula (a large selection of jams, there is a kosher and diabetic line);
• Polish Helcom (13 types of jams, including orange and pineapple jams);
• German Zorbiger (classic jams and confitures based on Zuegg family recipes);
• Austrian D’arbo (classic jams, the company has been around since 1879).

Manufacturing

The wave of fashion for made in Ukraine has given birth to many small artisanal enterprises. Among them, a decent share was taken by the production of food products: jams and jams, sauces, nut pastes. Some of the new producers managed to build a successful brand positioning strategy and find their consumers.

Confiture Gastronomy. At the end of 2011, the first batch of jams and jams from Confiture gastromastery was released. Now the assortment already numbers 34 items. In addition to 11 jams and confitures, you can also find spicy tinctures, cookies and chocolate. Now the gastromaster’s shop has its own two mono points of sale in Kiev and a network of partner retailers (e.g. Good Wine). Ryabata also managed to cooperate with illustrator Yevgeniya Gapchinskaya. Her works decorated one of the brand’s lines.

In addition, the company cooperates with Ukrainian goods stores and expands its sales territory. In addition to Kiev, branded points of sale have opened in Odessa and Kharkiv. The brand’s strategy is to create simpler packaging (currently gift packaging is presented) and to appear on the shelves of supermarkets.

Jam packaging design: trends

The positioning of jams and confitures can be divided into several groups:

• emphasis on ‘home’ production.”
• emphasis on brand personality, gourmet flavors;
• emphasis on appetizing product presentation.

Each approach implies a particular style of packaging.

1. Labels of homemade jams are often made of kraft material, over the lid of the jar wrapped with cloth or paper, for a greater association with jam from grandma. Fonts mimic handwritten fonts in every way possible. All of this reinforces the image of traditional handmade products.
2. The second type usually belongs to the premium category. Their labels can be minimalist or brightly decorated. The word that best suits their characterization: noble. They stand out on the shelves with unusual colors, carefully designed finished images.
3. The third type is jams of the mid-price segment. Their packages are very traditional, the labels are bright, they most often depict fruits. Often on the label you can see a photo or illustrations with additional attributes: bread, tea, a knife that spreads butter on toast. Examples include JimJams, the UK market leader in jams. Or Ukraine’s Veres and Holiday.

You can read more about candy packaging design in our article.

 

Forecast for the jams market in 2017

1. Small Business Development. Small home-based businesses that managed to survive the crisis will continue to grow. They will not be able to displace the big market players because of the higher price of their product. However, this will not prevent them from developing the direction of “special” sweet preserves.
2. Merger strategy. Big companies can fight the crisis and sales decline by joint advertising with other TMs. The strategy of combining advertising campaigns of flour and jams (for winter period), ice cream and jams (for summer period) can be interesting.
3. Everyone to the fairs. Exhibitions and fairs can help you find new customers. The International Sweets and Biscuits Fair has been bringing together manufacturers from all over the world since 1971. It is the largest specialized exhibition of sweets, snacks and confectionery industry. In Ukraine there are also enough variants of this kind, they are less large-scale and suitable for beginners. The fair “In Poshukki made in Ukraine” and “VsiSvoy” have become especially popular.
4. European Perspectives. The European market of “niche” products may become promising for Ukrainian jam producers. The demand for berries and products made from them in Europe is now enormous. If positioning is properly developed, organic jams can find a buyer in Europe. Already now Ukrainian farmers supply organic berries to the EU. Jams have every chance to repeat their success. In Europe, one jar of organic jam costs from €6 to €8. The catch here lies in the size of the supply. Young companies are not able to produce large quantities for large customers. The solution may be the creation of producers’ cooperatives.
5. Market Instability. Weaker businesses with small shares or unrecognizable brands may exit the market. There may be takeovers of companies that are mired in loans or with declining financial performance.
6. In addition, there is a high probability of re-profiling of production facilities. For example, instead of producing batch products, it is possible to supply jams for the bakery sector, sign contracts for direct deliveries to large enterprises or produce products for HoReCa.
7. After signing the Free Trade Agreement with the EU, Ukrainian jam producers will gradually enter the European market. The main thing is to obtain European quality certificates.Ukrainian products are cheaper than French, Austrian or Greek ones. Its quality is not inferior to European goods. However, logistics eats up the difference in price. This is the problem of supplying Ukrainian goods to the EU. Companies from western Ukraine (due to territorial proximity to the border) are better able to cope with this problem.

Market analysis of jams: results

1. Due to the shaky dollar exchange rate and rising prices for raw materials, those enterprises that have their own agricultural land are in a good situation.
2. Specialists forecast a slight increase in the consumption of fruit and vegetable preserves in general and jams in particular. However, it is difficult to guarantee this; in an unstable situation everything can change quickly.
3. Exports of Ukrainian sweet preserves are forecast to grow and warm up to the figures of 2013.

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