Developing markets will lead the next wave of chocolate and nut growth: ofi

By Oliver Morrison

- Last updated on GMT


Related tags ofi Chocolate Confectionery Nuts hazlenuts

The humble hazelnut is poised to tap into a host of new applications, trends and markets, says ingredients giant ofi (olam food ingredients).

As well as supplying cocoa, coffee, dairy and spices, the company (the new operating group born out of Olam) is the number one supplier of all seven major nuts and the world's largest independent hazelnut supplier. Such is its scope, it claims to supply enough hazelnuts to make 673 million jars of hazelnut spread every year.

From ofi’s sourcing and processing operations in Turkey (which accounts for nearly three-quarters of global production) its hazelnuts are exported all over the world as an ingredient in various sweet and savoury products from chocolate and pralines, to spreads and oils. Doing so requires an extensive range of nuts and flavours in customized formats (including natural, blanched, sliced, diced, slivered, roasted, organic, paste and oil) to accommodate modern consumer preferences.

The Singapore-based company is therefore confident it is well positioned to capitalise on the ‘health halo’ enjoyed by nuts among end consumers thanks to high amounts of unsaturated fats, fibre, calcium, iron potassium and protein. Nuts can also support front of pack labelling too. Nutrition-based schemes such as Nutri-Score consider nuts as having a positive impact on the overall nutritional score. There is also an opportunity to use them in savoury snacks in the UK, due to their exemption from the country’s HFSS regulation.

Heath and indulgence

Crucially, though, nuts can provide both health and indulgence, and the importance of the hazelnut is linked to chocolate and confectionery, where it dominates the category and is the top flavour for launches in Europe. Ofi is busy unleashing sensory and functional benefits to new or existing products. It sees classic combinations like chocolate and hazelnut evolving to include extra flavour notes, like salt or spice. Think of a bar with hot honey coated hazelnuts, for example.

Exciting as this type of innovation is, three quarters of hazelnut production is for the chocolate category, said Swaroop Joshi, ofi Vice President, Sales and Marketing. Categories like ice cream, muesli, protein powder, nut milks are all 'slowly growing' he said "but today the industry is still dependent on the chocolate confectionary consumption​”.

Developing market growth key

The company has observed steady annual hazelnut consumption growth of around 4-5% growth in the last few years. The company is now keen to exploit the enormous growth potential it sees in the chocolate category in developing markets. "I come from India myself and the first time I saw a hazelnut was when I was in mid 20s,” ​revealed Joshi. “I didn't know there was something called a hazelnut which is made into a paste and added to chocolate spread.”

He expects growth in chocolate and hazelnut consumption to accelerate as consumers in developing markets discover a taste for it. Europeans typically eat 6-7 kilos of chocolate a year, he claimed. In China, that number is currently just 100 grammes. “In markets like China, India, Brazil, Pakistan – that is where the growth will come.”

There also growth potential for hazelnuts in the snacking category, he said. In Turkey, for example, it is common to see salted or caramel hazelnut eaten as a snack.

"Across most of the globe you've not seen hazels on the snack shelf along with cashews and peanuts and almonds,”​ he noted. “We believe that's an unexplored market and we are trying to make some inroads into that to see if that can be explored better.

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