Natural Ingredients Gaining Ground
What began as a budding trend some time ago has now firmly established itself in the market: Demand for natural food ingredients is at an all-time high. With consumers becoming increasingly conscious of what they eat, foods based on natural ingredients clearly top their grocery shopping lists.
This is also reflected by current market data. Whilst food consumption in Western Europe remains virtually stagnant at 0.5 percent annual growth, the food ingredients market is showing constant movement, as reported by RTS Resource in a survey entitled “The future for natural and health ingredients.” The survey shows that more and more artificial ingredients are being replaced by natural substances—a development which producers of such ingredients can certainly feel in their day-to-day business. Accordingly, they are focusing their development efforts on an ever-growing number of solutions and ingredients to accommodate this market trend and thus create a strong buying incentive. The latest trends and innovations will be on display later this year at the Food Ingredients Europe (Fi Europe) trade fair in Frankfurt (November 19th to 21st).
One possible approach is to reformulate products by replacing artificial components with natural ingredients to make them more attractive for consumers again, and to thereby retain a competitive edge in a stagnating market. The exhibitors at Fi Europe have set their sights on just that, and will be presenting a wide range of natural and organic ingredients. More than 26,000 purchasing agents from around the world will attend the fair to review the palette at firsthand and determine how they can use these ingredients for their products to meet consumer demand.
Artificial flavoring additives can often be replaced by natural flavors. According to the RTS Resource survey, the market volume of natural flavoring agents in Western Europe amounts to EUR 563 million, with a projected growth rate of 3 percent. This already accounts for a 40-percent share of the total market in this segment. Companies like Sipal Partners offer flavors made from natural ingredients such as rice, wheat, and manioc, which are used for syrup production. Most of the raw materials are grown in Europe using environment-friendly, sustainable, and resource-conserving techniques, and are not refined. The resulting organic products therefore benefit from being labeled as containing, for instance, “non-refined rice syrup” instead of “sugar” or “glucose syrup.”
Barry Callebaut takes things even one step further. The company offers handpicked cocoa fermented by using a method that is one hundred-percent natural. The process allows the complex aroma of the cocoa beans to fully develop. In addition, farmers receive training in cultivation methods so that sustainable production is ensured. The program also improves the farmers’ living and working conditions and provides easier access to educational and health resources. The company’s approach to sustainable production and the natural fermentation process therefore yield a natural, sustainably produced end product of the finest flavor. This is an absolute advantage when it comes to the customers’ buying decision.
Equally impressive growth is seen in the market for natural food coloring agents. The share of EUR 327 million of the total market for coloring agents in 2005 has increased by 68 percent to date, and now amounts to EUR 551 million. Aicacolor SAC, for example, is a company that utilizes annatto seeds for its products. Even the Maya used the seeds of the tropical Bixa orellana tree for coloring and dying. Today, natural processes are employed to extract the pigments and to provide a palette of natural food colorings ranging from light yellow to dark red.
Another trend is the coloration of food products based on the natural colors found in other foods. Instead of artificially extracted pigments, the natural coloring agents contained, for instance, in powdered spinach or carrots, red cabbage, beetroot, or paprika and other spices, are utilized. The stability of the end product can be an issue with this method of food coloration, and is the reason why the process is currently used primarily for rice, noodles, yogurts, desserts, and soft drinks. To date, these products have gained a market share of EUR 192 million in Western Europe, with forecasts predicting a rising trend. This is another indication that growing customer demand is forcing companies to focus more strongly on natural colors and to gradually replace the synthetic coloring agents.