The Ingredient Curve: More Food in Our Food

The Ingredient Curve

Mapping the use of added value ingredients against per capita spending on retail packaged food and beverage, a strong correlation emerges - higher spend means greater demand for added value ingredients.

More food in our food

At least that’s true until such time per capita spending exceeds US$1,500, when the proportion of added value ingredients in our packaged food and drink flat lines, and even declines. At the same time, sales of naturally healthy food can be seen to grow. This suggests there comes a time when worldly wise consumers want more food in their food.

Opportunities for ingredient players are significant

The position of a country on the curve suggests the type of opportunity it offers ingredient players, who themselves are looking to move out of commodity style ingredients into higher value propositions.

Emerging markets: strength in depth

Ingredient companies need access to future growth markets that their own customers are entering. Here there is a need for all types of ingredients as consumers start to buy increasing amounts of processed food and beverages.

Developing markets: health and wellness accelerates

Moving along the curve, as spending grows and basic calorific needs have been met, awareness of the benefits of added value ingredients becomes more prevalent. We expect uptake of these ingredients to be fast tracked as consumers’ aspirations are quickly met.

Developed markets: enhanced natural

In the most sophisticated markets, even as consumers coalesce around the trend for ‘natural’, opportunities exist for ingredient companies that can support clean label claims and the growing demand for ‘enhanced’ natural products.

The innovation imperative in our changing times

There’s an imperative for ingredient companies to innovate to meet the needs of increasingly demanding food and beverage manufacturers chasing cost optimisation, who in turn are trying to satisfy the needs of consumers with complex and diverse demands of their own.