Consumers had been lured away from cereal aisles in recent years by a fast-growing menu of other breakfast options, at restaurants and home.
The pandemic pushed U.S. cereal sales back above $9 billion in 2020 -- good news for the two Minnesota companies, General Mills and Post Consumer Brands, that together sell half of all ready-to-eat cereal in the U.S.
But as lockdown stockpiling eased from their heightened levels, sales slipped this year to $8.66 billion, according to Information Resources, Inc., a Chicago-based market research firm.
Still, General Mills has managed to increase its U.S. market share for 37 straight months, the company says, tightening its grip as the country's top cereal producer.
"Our performance is not driven by short-term competitive supply chain dislocations," said General Mills' president of North American retail, Jon Nudi. "It's the result of consistently bringing compelling consumer ideas, relevant innovation, strong levels of investment and excellent execution to the best brands in the category."
Over 52 weeks ending Oct. 31, General Mills sold $2.85 billion worth of cereal in the U.S., according to Information Resources. That was 4.4% lower than the year before, but sales fell further among its largest competitors, Kellogg Co. and Post Consumer Brands.
General Mills' Honey Nut Cheerios remains the top-selling cereal in the U.S., with the Golden Valley-based company's Cinnamon Toast Crunch in second.
According to Information Resources, Honey Nut Cheerios had higher sales than all store brands -- such as Target's Good & Gather or Costco's Kirkland Signature -- combined.
Private label, as the often less-expensive store brands are collectively known, saw a 15% drop in sales over the past year even as inflation caused a spike in food prices.
"People are not trading down to private label, people are going to brands they know and trust," General Mills chief executive Jeff Harmening said. "Eating at home raises all boats but we've done better than most."
Michigan-based Kellogg, which weathered a two-month strike at its cereal plants that recently ended, saw U.S. sales slip 8.8%. Its Frosted Flakes and Froot Loops are the third and seventh best-selling cereals, respectively.
The company in November blamed supply chain disruptions for its slower cereal sales, which represents 20% of Kellogg's global business.
"The performance of key brands in the U.S. has been impacted by supply complications in North America, but internationally, we're seeing good growth," Kellogg Chief Executive Officer Steve Cahillane told investors in November.
Post Consumer Brands makes the fifth-best-selling cereal, Honey Bunches of Oats, which saw a 10% drop in sales after enjoying a pandemic-fueled bump the year before.
Among the top 20 best-selling cereal brands, only Fruity Pebbles and Cocoa Pebbles saw sales increase from Oct. 31, 2020 to Oct. 31, 2021, according to Information Resources.
The outlook for cereal has been revived somewhat by the lasting effects of pandemic-era grocery shopping and a permanent shift to more people working from home.
"People will work at home more than they have before, once this pandemic hopefully ends," Harmening said. "Which is more people eating at home, which is great for us."