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Ethnic foods drive innovation from manufactures, flavour cos

By Jess Halliday, 24-May-2007

Related topics: Flavours and colours, Market Trends

Growth in the retail ethnic foods in Europe is outpacing overall growth in the foods and drink sector, according to Leatherhead Food International, offers new challenges and opportunities to manufacturers and ingredient companies.

The new report, called The European Ethnic Foods Market, values the Western European market at €4.12bn in 2006. Of the countries included in the research (UK, France, Germany, Italy, Spain, Germany and the Benelux and Scandinavian countries), the UK was found to have the largest and most developed market, worth €2.34bn, followed by France and Germany.

 

 

 

Leatherhead last published a report on the topic in 2004, which valued the market at €3.4bn, but on that occasion Benelux and Scandinavia were excluded so the true figure would have been slightly higher.

 

 

 

Principle market analyst Jonathan Thomas told Food Navigator.com that the UK food sector at large is generally estimated to be growing at a rate of between two and three percent.

 

 

 

The growth in ethnic foods creates particular opportunities for flavour companies, given the strong association of certain taste profiles with oriental foods. Chinese/Oriental food makes up the biggest slice of the market, accounting for 42 per cent.

 

 

 

But other countries' foods are also garnering interest from European consumers, including Thailand, Japan, Malaysia, Indonesia, Vietnam, Morocco, North Africa and the US (such as Cajun). These give flavour companies a whole new set of challenges in developing authentic flavours.

 

 

 

There is some shift in product categories popular with consumers. For instance, frozen ready means and cooking sauces are said to be reaching maturity in developed markets,

 

 

 

"Manufacturers are now looking to develop into new areas," said Thomas, citing savoury snacks as a prime example. Nowadays there are considerably more products available on the snacks market than just crisps and nuts - such as organic snacks, tacos and tortillas that aim to capture the gluten and wheat-intolerant.

 

 

 

Leatherhead attributes the growth in ethnic foods to a number of factors, including the increasingly adventurous tastes of the younger generation. Moreover, as people are tending to travel more, they want to experience the same foreign foods back home.

 

 

 

Thomas said that food service outlets (restaurants) are likely to be the place where consumers try new ethnic foods for the first time, and indeed, food service is set to remain the leader and driver of the category.

 

 

 

"People are still cash rich and time poor, so the indication is that food service will continue," he said.

 

 

 

But it also depends how well the retail sector can compete. If people are able to make the same foods at home as they could buy from a take-away, they have the added advantage of knowing what is in them.

 

 

 

The new report is published in association with Food From Britain, a consultancy commissioned by the UK government to help UK food and drink producers find profitable new markets, both in the domestic market and overseas.