The Asia-Pacific baby food market is shrinking as milk formula consumption continues to fall, according to a report by Euromonitor International. This trend is pushing manufacturers to explore new strategies for growth.
Milk formula, which made up 82% of the region’s baby food retail sales in 2024, is expected to drop to 79% by 2029. The most significant losses are anticipated in China, where the market is projected to decline by $4.8 billion during this period.
China, which currently accounts for 65% of Asia’s baby food sales, is forecasted to see its share decrease to 56% by 2029. In response, manufacturers are focusing on other key markets in the region. India is set to experience a 6% compound annual growth rate (CAGR) in baby food retail sales from 2024 to 2029, while Indonesia and the Philippines are each expected to grow at 3% CAGR.
To counter declining sales, manufacturers are introducing science-based products that cater to health needs. For example, Nestlé’s Nan Infinipro now features six human milk oligosaccharides (HMOs) and probiotics to support digestion and cognitive health. Premium products, including organic and allergy-friendly formulas, are also performing better, with a modest annual growth rate of 1% projected through 2029.
Non-formula baby food is poised for slight growth, with a 1% CAGR expected from 2024 to 2029. Dried baby food is leading this segment, especially in Vietnam, where it accounts for 93% of baby food retail sales in 2024. The popularity of dried ready meals in Vietnam aligns with this trend.
India and Indonesia are predicted to lead dried baby food growth with CAGRs of 7% and 6%, respectively. Meanwhile, prepared baby food is expected to grow more rapidly in Thailand and South Korea, with 6% and 5% CAGRs, reflecting local preferences for convenient options.
Declining birth rates are also prompting brands to diversify into products targeting older children and even adults, according to the report.
Overall, the Asia-Pacific baby food market is expected to contract by 2% annually through 2029. Despite the challenges, larger brands are strengthening their market share, now holding 41% of the market compared to 36% in 2019, as smaller competitors exit the industry.
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