Sweets Losing Their Place in Household Baskets as Confectioners Face Rising Costs and Falling Demand

Declining consumer purchasing power, rising raw material costs and increasing operational expenses have placed Iran’s confectionery sector under significant pressure. As a result, sweets have gradually shifted from being a regular household purchase to a product mainly associated with special occasions, creating additional challenges for confectionery businesses.

The increase in the prices of key inputs such as sugar, confectionery oils, flour, eggs, dairy products, nuts, cocoa and packaging materials, alongside higher costs for wages, insurance, taxes, energy and rent, has significantly raised production expenses. However, reduced consumer purchasing power has limited the ability of producers to increase prices accordingly, leaving confectioners under pressure from both rising costs and weaker demand.

One of the clearest signs of the sector’s slowdown is the change in consumer behavior. Sweets, which were previously part of routine household purchases, are now increasingly reserved for celebrations and special occasions. This shift has not only reduced sales but has also put long-established and traditional confectionery businesses at risk.

To overcome these challenges, industry representatives emphasise the need for a more stable and transparent supply system for essential raw materials, particularly sugar and confectionery oils, as well as reducing cost pressures related to taxation, insurance and production expenses.

The confectionery industry is an important part of the food value chain and plays a significant role in employment. Ensuring its sustainability requires policies that address the root causes of rising production costs rather than focusing only on the final consumer price of products.