Snapshots of Food Industry News
Report on specialty food ingredients market
The market for specialty food ingredients is projected to reach USD 91.2 billion by 2020 and is expected to grow at CAGR of 5.5% from 2015 onwards. Speciality food ingredients are used in in Bakery & Confectioneries, Beverages, Dairy & Frozen Foods, Convenience Food, Meat Products, Functional Foods/ Beverages/ Dietary Supplements, Oils & Fats, Savoury snacks, Sauces, Dressings & Condiments so the speciality ingredient market has tremendous scope for growth. The main trend in the report emphasises that the demand is core-related to the increase in demand for convenience foods and this is likely to sustain the growth for speciality food ingredients. The application of speciality ingredients in food products is what makes their co-relation important to the food processing market.
The use of speciality ingredients by the food processing industry has also led to stricture regulations on food safety and shelf life. The food processing industry understands the pivotal role that speciality ingredients play in providing some of the best food products to consumers and so they want to get the formulation correct. Advanced technology, nutrition, taste, rise in convenience food sector are some factors that are pushing growth in this market. North America is the dominant player in the global specialty food ingredients market followed by Asia-Pacific region. Asia Pacific is gaining ground because there is a preference for healthy food choices in this region. Worldwide there is an increasing demand for processed foods and preference for quality products and so the speciality food ingredients market is quite optimistic about growth.
Twiss Drinks enter India with aerated juices
The UK beverages company, Twiss Drinks has announced their entry into the Indian beverage market. The company has tied up with India’s Amarjothi Group and will initially offer aerated natural juices as they feel that the Indian market is ready for these drinks. Twiss Drinks could get a further push because even the Prime Minister, Narendra Modi, has made a suggestion to include a minimum of 2 per cent of fruit juices in aerated drinks. This announcement was made with a view to help farmers find markets for their produce.
Twiss Drinks made their UK debut in 2011 and since then they have introduced a number of drink variants. Their juices in India will be manufactured in Pune. The aerated beverage will have just 10 per cent juice content and will be packaged in 250ml cans. Price for one can of fizzy juice drink is slated to be Rs.40 and the juices will be marketed through multiple channels.
Maggi controversy has brought gains for competitor Yippee
Nestlé’s Maggi controversy has allowed rival ITC’s Yippee to make immense gains in the noodle market. Sunfeast Yippee are close to reaching the Rs.1000crore mark and things are continuing to look bright for them. It has been five years since the roll out of ITC’s Yippee brand and the company were posting a growth of 40 per cent till the Maggi issue broke out after which Yippee noodles got a new lease of life.
The entire noodle industry was affected after the Maggie issue but ITC took advantage of the slack and launched innovative campaigns and provided proactive inputs like laying emphasis on their manufacturing process. Since then they have seen a surge in their market share. ITC had launched Yippee from their Pune plant five years ago but have since increased their capacity with plants in Kolkata, Haridwar and Bengaluru. The company say they will continue to make investments in this segment which will be in line with their future plans for the noodle category.
FSSAI’s new product approval norms could see rise in FDI
Union Minister for Food Processing, Harsimrat Kaur Badal, expressed the view that Foreign Direct Investment (FDI) in food processing could go up by 25 per cent because the FSSAI has eased product approval norms. The food processing industry had been emphasising the fact that if propriety food products use already approved ingredients then there should be no need for fresh regulatory approval. The new FSSAI product approval norms have catered to these concerns to a great extent which should also see an increase in FDI in a few months.
Earlier product approval was required for all products except those for which FSSAI had laid down standards. FSSAI had standards only for 370 products in the regulations so food manufacturers had to apply for product approval for all food products that were not categorised in this list of approved products. FSSAI has now notified that fact that if food products contain regulation permitted ingredients and additives then there is no requirement for fresh product approval from the Apex regulator. This change in product approval norms could see the market come up with innovative products while the traditional food product market could see a surge.
Casual dining chain, Barceló’s to set up 40 outlets in India
Barceló’s, South African casual dining chain, is planning to invest in India in a big way. By 2019 they mean to have 40 stores operating in India in cities like Delhi-NCR, Kochi, Chennai, Mumbai, Jaipur, Pune, Hyderabad, Bengaluru, Goa and Kolkata. Barceló’s will make an investment of USD 5 million by 2017 and is targeting a turnover of Rs.200crore in the coming four years.
Presently the brand owns only two outlets the second of which was recently opened in Delhi’s Hauz Khas Village. The company began with a single operation in 1993 in Pretoria and began franchising in 1998. It has now expanded to 17 countries and they have 120 outlets worldwide. In India they hope to set up stores through company owned and franchise mode.
A brief overview of India’s Annual Food Report
The 9th Annual Mega Congregation of India Food Forum was held recently in Mumbai. At the event, General (retd) V.K. Singh, Union Minister State for Statistics and Programme Implementation (independent charge) and Minister of State for External Affairs & Minister of State for Overseas Indian Affairs released India Food Report 2016. According to the Report, in the next six years, the food market is expected to register an average growth rate of 5.3 per cent per annum with an increase to 5.7 per cent by 2021. Food retail will see an increase in both the urban and rural arena. A number of leading organisations like Nielsen, A T Kearney, Accenture, PWC, PRICE, Wazir, Maple Capital Advisor etc. have contributed to making the Report.
The report gives a detailed size of the food manufacturing industry including the marketing and retailing sectors and contains detailed research on the food service industry and grocery retail. It highlights the areas that need impetus for sustained growth in all sectors related to food including food & grocery, food service, food retail, food processing, food logistics & support, food services, supply chain and technology. It offers insights for business opportunities, investment potential and challenges that the food sector faces. The report also offers inputs on consumer spending and food retail market and adoption of multi-channel marketing. Since the report has been written by experts in their field it offers useful inputs to those associated with the food processing as well as food retail sectors.