India’s once-booming appetite for packaged snacks has reached a plateau in FY25, with average household consumption remaining unchanged at 12.8 kg, according to new data from market research firm Kantar, as reported by The Times of India. After years of steady growth, the sector now faces its first major slowdown since the pandemic.
Analysts attribute the stagnation to a combination of “consumption fatigue,” persistent inflation, and a lack of innovation in new product offerings. Kantar noted that snacking frequency — a key driver of volume — failed to grow in FY25 for the first time in years.
Biscuits, Noodles Take a Hit
Within the broader snack category, biscuits and noodles — two staple items — saw slight declines in household uptake. Biscuits, which make up more than half of snacking volumes, posted just 1% growth in FY25, down sharply from 10% in FY24. Instant foods like noodles, pasta, and vermicelli also registered decreased traction.
Overall, volume growth in the packaged snack segment dropped to 4% in FY25, down from 9% the previous year. Savoury snacks, which had grown 11% in FY24, rose by only 7% this fiscal.
Inflation, Shrinkflation, and Smaller Packs
Rising input costs, particularly a steep 40–45% jump in edible oil prices following a hike in import duties, have significantly impacted margins and pack sizes. Snack manufacturers were forced to reduce grammage in small packs, limiting value for consumers and discouraging repeat purchases.
“Nearly 80% of our volumes come from small packs. With elevated oil prices, we’ve had to cut pack sizes, which naturally reduces overall consumption,” said Mayank Shah, Vice President at Parle Products.
Although prices may stabilize, Shah noted that current levels remain high enough to constrain consumer spending.
Shift towards Regional and Value Brands
Economic pressures are also nudging consumers toward regional or unbranded alternatives. A 2024 survey by Mondelez revealed a growing trend of consumers switching to off-brand snacks, smaller pack sizes, and value-focused buying tactics like coupons and bulk purchases.
“Despite the slowdown, 86% of consumers still consider snacking a daily boost,” said Nitin Saini, Vice President (Marketing) at Mondelez India. He emphasized the need for dynamic pricing, flexible packaging, and continued innovation to maintain relevance.
A Post-Pandemic Reality Check
According to K. Ramakrishnan, Managing Director – South Asia, Worldpanel Division at Kantar, the slowdown reflects a “natural correction” after the pandemic-era spike in snack consumption.
Manoj Verma, COO of Bikaji Foods International, echoed the sentiment, stating that although growth has tapered, snacks remain among the more resilient segments within the broader food category.
As India’s snacking sector hits a pause, industry players may need to recalibrate their strategies, prioritizing affordability, variety, and innovation, to reignite consumer interest and appetite.