Halloween a sweet deal for Canada’s food manufacturers

During the month of October, approximately 4,121,299 Canadians will capture the imagination of every retailer in the country.

The demographic – children aged 5 to 14 years old — will be startlingly effective in motivating parents to purchase non-durable and in many instances, non-renewable goods. In October 2015, those parents spent $51 million on pumpkins, squash and zucchinis… and $418.8 million on candy.

There’s no indication 2016 will be anything less: for 20 years, candy sales at large Canadian retailers have grown faster than any other food. With $318.3 million spent on average each month in 2015, only December’s sweet blitz beats October’s.

This could be worrying, given the high sugar content of candy and its health consequences. But Canada’s candy is made from a variety of sweeteners, including honey, maple, sugar beets, sugar cane, and a variety of other fruits and vegetables.

The most recent addition to the list of sweetening sources? Trees.

Canada’s sweet on sweets

Over time, Canada’s sugar beet industry has increased yields through productivity gains, but has decreased harvested acres. Production of sugar beets has dropped 50% in the last 50 years. Still, the Canadian sugar industry is vibrant. It has generally enjoyed a far more competitive position in world markets relative to the U.S., where the large sugar sector is highly supported.

As a result, we export a lot of confectionery to global markets, the majority to the U.S., one of the world’s largest producers and consumers of sugar cane and sugar beets. With such a huge market right next door, Canada’s chocolate and confectionary products have become the country’s second largest export of manufactured food. Among all exporters in 2015, Canada ranked as the world’s eighth-largest exporter of chocolate and candy, with 5% of the global market.

Sugar prices are expected to rise from recent lows, having fallen by more than 30% in 2014. Not surprisingly, sugar production among major producers (e.g. the European Union and India) has declined, leading to a lower stocks-to-use ratio (PDF 3.4 MB) in 2016. I doubt higher prices will curb either demand or consumption of one of Canada’s favourite foods however: for more than 4 million candy-loving Canadians – and the businesses that serve them -- Halloween will always be a real treat.