Health trends to drive flavour innovation in 2006

By staff writer

- Last updated on GMT

Related tags Flavor

The growing demand for nutritional food has had a positive impact
on the demand for flavours, with consumers unwilling to compromise
on taste according to a market analyst.

And with strong growth predicted in the low fat and low sugar foods and beverages market in 2006, Frost & Sullivan says that global demand for flavours can only grow.

The consistent development of new and innovative flavours is also driving the growth of the flavours market. Consumers today are more receptive and appreciative of foods and ingredients from across the globe, and manufacturers are continually researching new products and tastes to tap into this market.

As a result, flavour houses are developing new exotic flavours such as lychee and guava as well as providing novel combinations of original favourites such as strawberry and mint. Furthermore, they are producing tools to help manufacturers precisely define the flavours they want and this extends to preferences in cooking techniques such as roasting, grilling, or frying for meat flavours.

"Considering the highly progressive nature of the flavours industry, major market participants are making significant investments in R&D activities in order to differentiate their product offerings,"​said Frost & Sullivan research analyst Kaye Cheung.

"Hence, the development of new technologies and delivery systems that improve the application of flavourings in food products is likely to be crucial to the future development of this highly competitive market."

Among the key challenges affecting the flavours market is the growing trend toward consolidation and the increase in price pressure. The top five market participants account for an estimated 54 per cent of total revenues and large flavour houses are expanding their application base by acquiring smaller specialised companies.

Smaller flavour companies are finding it difficult to stay competitive as a result and the trend toward consolidation is further spreading down the supply chain, reducing the customer base for ingredient suppliers.

On the other hand, pricing pressure is partially as a result of the increasing consolidation in the fast moving consumer goods (FMCG) market. Due to their heightened buyer power, large food manufacturers operating on a global scale are exerting pressure on flavour suppliers to reduce their prices.

In dealing with these challenges, collaborations with raw material providers may offer smaller manufacturers a competitive edge. Also, as the western markets are nearing saturation, expansion into developing markets such as those of Eastern Europe, the Middle East, and Asia is likely to provide more lucrative opportunities.

Frost & Sullivan says that the global flavouring market was valued at $4.80 billion in 2005 and is likely to touch $6.22 billion in 2012. Beverages are the leading application segment for flavours and represented a consumption share of 31.1 per cent in 2005.

Regionally, the United States, Japan, and Western Europe presently dominate flavour consumption. Most of the future growth is likely to be in the Asia Pacific region, particularly in developing countries such as China and India.

"Success and growth in the flavours market hinge on innovation, which is essential to meet the varied and fast changing needs of the customers in a cost-efficient and effective manner,"​ said Cheung.

Related topics Market Trends Flavours and colours

Related news

Show more

Related products

show more

Great taste remains with sodium & sugar reduction

Great taste remains with sodium & sugar reduction

Content provided by Lycored | 06-Oct-2023 | White Paper

Consumers want healthier labels with less sodium and sugar but aren’t willing to compromise the full sodium and sugar tastes they love. So what are you...

Related suppliers

Follow us

Products

View more

Webinars