8 Top Ingredients Trends for 2008

By Kathryn Schuett


No matter what study you look at, today’s organic consumers are complex. They want their purchases to help save the world or at least preserve their own lives till a ripe old age. Others are clamoring to products that cater to needs like eating healthy on-the-go or avoiding allergens. They want trustworthy products that have scientifically proven benefits as well as an authentic story. Organic, fair trade, healthy, premium, local, non-GMO, low-glycemic, gluten-free, cage-free—they want it all and companies are filling their labels to capacity with certification seals and bulleted lists of benefits in order to reach out to these consumers.

While organic is still one of the most dynamically growing sectors, it’s important for those in organic to pay attention to the other trends around them. “Organic is typically a gateway into other product categories so it serves as the first step on a continuum to “eating better” in the words of consumers,” said Laurie Demeritt, president and COO of The Hartman Group. “Because of the growth of organic, however, it’s no longer enough for companies to simply introduce an organic product and think organic alone will make it distinctive.”

“As organic grows and evolves, consumers will start to look for “what’s next” in terms of additional benefits. It’s not that organic goes away or becomes unimportant, but that it must incorporate new areas of consumer interest as well,” Demeritt said.

With this in mind, Organic Processing Magazine took a close look at dozens of market reports and hundreds of statistics, as well as the innovative new products coming out on the market, and identified some of the top trends in ingredients, as well as some emerging trends that you’ll will want to keep a close eye on.

Of course many of these trends cross over—organic itself spans across several trends including ethical, eco-friendly, healthy and premium—but there are two main messages coming through. Consumers want products that are “Better For Me,” and “Better For The World.”

“Better For Me” Trends
Today’s consumers are looking at many ways to improve their quality of life through their food purchases. The healthy foods industry alone is worth $120 billon, according to Nutrition Business Journal’s “Healthy Foods Report 2007.” But “Better For Me” doesn’t have to mean healthy, it can also mean treating yourself to better quality products. Because consumers already see organic as “healthier” and “premium,” organic processors have a headstart in these categories, but there is an opportunity to improve your competitive advantage by following other trends with in these categories.

1. Functional Health
Thousands of years ago, Hippocrates said, “Let food be thy medicine.” Today, functional ingredients are making self-medicating through food as easy as snacking on an energy bar or drinking a bottle of flavored water. Functional ingredients, as their name suggests, serve many functions beyond just basic nutrition, from increasing energy and weight maintenance to longer-term benefits such as improving heart, bone, brain and digestive function, as well as warding off cancer and aging.

According to a study from Packaged Facts, functional foods and beverages brought in nearly $25 billion in 2006 and are destined to touch $39 billion by 2011. One of the fastest growing segments in this category is omega-3s, which are expected to reach a market value of $7 billion within the next three years. This “good fat” can be found in a range of organic ingredients including flax seed, hemp, algae and açaí.

Antioxidants, which became famous with the blueberry, are another of the fastest growing healthy trends. Green tea is one of the most widely recognized sources with a market of 160 million in the United States alone (Datamonitor) and other teas such as white, red rooibos and yerba mate are growing in popularity as functional ingredients as well.

But even more than tea, superfruits represent the largest areas of growth. According to Datamonitor, pomegranate alone has seen a 500 percent increase as an ingredient in new products since 2005. Rainforest-sourced superfruits are also seeing Amazonian growth; Mintel reports found that in just the first six months of 2007 there was over 70 percent growth in products featuring açaí and cupuaçu alone. Among some of these launches were Tesco’s private label guava-orange-açaí yogurts as well as a heart healthy burger from Sobey in Canada featuring garlic and açaí berry topping. Trader Joe’s also launched an organic pasteurised mango açaí juice.

Other superfruits that have appeared in products lately include goji, camu camu, lychee, noni, yuzu, tamarind, acerola, pomelo, seabuckthorn and mangosteen. Frutzzo also just introduced a beverage line featuring the yum yum berry.

The key to superfruits, and many other functional ingredients, is to keep an eye out for new discoveries. “These can go from a hot buzz to major commodity in just a year. Nowadays, açaí is almost an expected ingredient in a high antioxidant formulation,” said Kharta Purkh Khalsa, senior research scientist at Golden Temple, makers of Peace Cereals and Yogi Tea. One of his latest finds is amla, also called the Indian gooseberry, a powerful antioxidant with a host of other benefits.

It used to be that organic versions of functional ingredients were hard, if not impossible, to come by—and some still are—but there are more and more certified organic options coming to market every day. To illustrate this, Cell-nique, a new certified organic “physician formulated” functional beverage, is made with over 31 superfoods and herbs, with the benefits of each detailed on the company’s website. A few of these good-for-you ingredients include grape seed extract, licorice root, ginko, garcinia cambogia, olive leaf, gotu kola, goji, açaí, noni, bilberry, alfalfa, green-blue algae, green tea, chlorella, spirulina, hemp and brown rice protein. Oh, and by the way, this concoction tastes great too, which is not always an easy accomplishment when it comes to adding functional ingredients.

With this constantly evolving category, keeping up with what’s new may seem overwhelming. The real challenge, however, will be on the supermarket shelf. In this saturated environment, products with health claims supported by sound science will distinguish themselves from the crowd.

2. Premium/Gourmet/Specialty
Packaged Facts estimates that U.S. retail sales of gourmet, specialty and premium foods and beverages through all retail channels rose to $59 billion in 2007, an increase of 10.9 percent over the previous year’s sales. In the next five years, this number is expected to top $96 billion.

2007 has seen a particularly large jump in premium product launches. Over 15 percent of all new food and beverage introductions in 2007 involved gourmet products, up from 10 to 11 percent during each of the four previous years, according to estimates based on Datamonitor’s Productscan Online service. The organic new product development within this trend is growing even faster though—nearly doubling this year.

“Organic is tied to premium because it’s seen as having been produced in a ‘special’ way because of extra care taken in the growing process, more handcrafted production, smaller scale production, etc,” said Demeritt of The Hartman Group.

Since organic is often seen as synonymous with premium, organic processors have a starting advantage in the gourmet category. Adding more specialty ingredients allows organic processors to take this to the next level. One way to do that is to add higher quality ingredients that taste better or have a better mouthfeel—for example there are now organic chocolate chunks that stay soft in ice cream or a frozen coconut milk which maintains more flavor than canned coconut milk.

With the growing fascination of world flavors, ethnic ingredients are also a part of this trend. Amy’s, Seeds of Change, Devya and others have launched specialty Indian sauces recently and REI even introduced a dehydrated meal called “Thai Fusion” for the backpacker with a more refined palate. Old-world ingredients are making a resurgence as well, including heirloom tomatoes and herbs and heritage grains like kamut, quinoa, amaranth and millet. One other trendlet within premium we are likely to see more of as well are name brand ingredients. Sambazon Açaí, Amazing Grass and Dagoba chocolate are leaders in this, but more companies like gourmet fruit grower Frog Hollow Farms are joining this trend as well.

One thing to keep in mind is that for consumers premium is not only about the flavor or the quality. The Hartman Group’s new study, “Premium Experiences: Understanding the Consumer Redefinition of Quality,” found that premium ingredients tend to be more about the narrative or story behind the ingredient than just the ingredient itself. For example, “65 percent pure cacao from Brazil”, “cranberries picked at the height of the season in Massachusetts”, “raw honey from rare blue honeysuckle bees.” Many premium ingredient suppliers can offer you intriguing stories to go along with their products.

3. Allergy and Special Diet Alternatives
“Free-Froms.” Sometimes it’s not what your product has in it, but rather what it doesn’t have. The International Food Information Council has reported that an estimated 11 million Americans have a true food allergy. In response to this many companies are formulating products know as “free-froms.” According to Mintel, the two largest areas of new product development in this category are gluten-free and dairy-free. Gluten-free products alone are expected to reach over $1.3 billion in sales by 2010. In addition, The Natural Marketing Institute(NMI) found that 46 percent of integrated users of organic products (those who use organic products at least once a day) are looking for dairy-free products and 42 percent of integrated users of organic products are looking for gluten-free products.

Going allergen-free can be challenging though. Gluten, for instance, is found in all forms of wheat as well as rye, oats and barley—which severely limits options for formulators. However, creative processors have found ways to swap these out with ingredients made from white and brown rice, potato, corn, quinoa, almonds, beans, buckwheat and more. Oats may soon be an option as well. Although oats are naturally gluten-free, most are contaminated with wheat in the growing and processing stages. However, there are now conventional oats available that have been grown and processed in a controlled environment. Bob’s Red Mill uses these in their gluten-free oats, and has seen an amazing consumer response. They are currently working toward developing the product in organic as well.

Whether it is for gluten or any allergen, finding ingredients made in a “dedicated facility” that doesn’t process foods with allergens that you are seeking to avoid is certainly an important step in ensuring safety.

Low Sugar/Low Glycemic. Even though the low-carb craze has slowed down, with obesity and diabetes on the rise, many consumers, including children, are watching their sugar intake. Research from NMI found that 29 percent of primary grocery shoppers who also buy organic are looking for foods that provide a low glycemic index and 42 percent agree completely/somewhat that they prefer foods with no sugar added. Processors such as French Meadow Bakery have responded to these requests by creating an organic low-glycemic bread, which actually features the “Low-Glycemic for Diabetics” seal, certified by the Glycemic Research Institute. Organic Bistro has also come out with a low-gycemic, gluten free line of frozen meals.

To lower the glycemic effect, try swapping out sugar with agave nectar, fruit juices or erythritol. Adding high fiber ingredients can also help curb the glycemic effect.

4. Emerging Trend—Non-GMO Verified/Identity Preserved
Today, it’s estimated that more than 90 percent of conventional soybeans and more than 50 percent of conventional corn in the United States is grown from genetically modified seed. GM versions of canola, papaya, zucchini and yellow squash have also been introduced and soon “Round Up Ready” sugar beets will be coming onto the scene.

The biggest problem with genetically modified organisms (GMOs) is that we don’t know the problems they might cause. The fact is that GMO seeds were put on the market without any testing for health or environmental side-effects—and now everything from the dramatic rise in allergies to the creation of superbugs is being linked to these man-made crops. In Europe there has been a huge backlash, with countries like Italy actually legally banning GMOs altogether and EU labeling laws identifying products with GMOs. This anti-GMO trend is likely to cross overseas soon, thus many U.S. companies are taking proactive steps.

“Although USDA regulations prohibit GMOs, as more conventional farmers start using GMO seed, there is an increasing chance of organic fields getting contaminated,” said Ken Roseboro, editor of The Organic & Non-GMO Report. “It’s becoming a real threat and the organic industry really needs to protect its integrity.” To ensure products are GMO-free, many ingredient manufacturers including Northland Organic, SK Food, Briess, Cargill and others have already created their own programs to protect the organic/non-GMO identity of their products.

The latest step in this movement is the creation of The Non-GMO Project, a non-profit group supported by Whole Foods, Organic Valley, United Natural Foods, Good Earth, Nature’s Path, Lundberg Farms, Eden and many others. This group is aimed at educating the organic and natural industries on GMOs and creating a standard and verification process to help protect our GMO-free integrity. The standard, developed by over 40 industry leaders, is set to be released at Natural Products Expo West in March of this year. Manufacturers are encouraged to get involved by submitting product information at www.nongmoproject.org.

“Better For The World” Ingredients
We may not all be able to join the Peace Corps or Greenpeace but, as consumers, many of us feel that we can make a difference with our dollar.

In “Sustainability: Understanding the Consumer Perspective,” The Hartman Group reported that 93 percent of Americans have some sort of sustainability consciousness, and out of that 75 percent think their purchases have an impact on society.

And this belief is making it all the way to the check out lane. In “The Future of Ethical Food and Drinks,” Global Business Insights reported that over 25 percent of U.S. consumers bought more socially responsible groceries in 2006 than the year before, and this trend is expected to have grown even more in the last year.

Within the trend of ethical, feel-good products, organic is already a key player but organic processors have a huge opportunity to take their authenticity to the next level by supporting other socially responsible initiatives in their product development.

5. Fair Trade
According to Global Business Insights, the combined total of the European and North American fair trade markets is $2.6 billion and the overall market is growing fast with a compound average annual growth rate (CAGR) of 38 percent between 2001 and 2006. Research from Mintel supports these findings as well. In this past year alone, they forecasted 57 percent growth of fair trade beverages and a 150 percent increase in fair trade food introductions.

One of the biggest launches this year was Ben and Jerry’s fair trade vanilla and chocolate ice creams, but many other companies are leading this charge as well. Simply Organic introduced four new baking mixes including chai scones, cocoa biscotti, carrot cake and banana bread, all of which feature organic, fair trade ingredients such as sugar, vanilla and chocolate. Their sister company, Frontier Co-op, has been making organic, fair trade teas for a while, but they wanted to go beyond just tea.

“There is a general excitement in being able to incorporate these ingredients in more products, and finding another way to include fair trade in everyday life,” said Steve Krusie, marketing director. “And it’s not just about doing it for the sake of it. These are quality ingredients. Sales have been greater than what we expected and we are staying focused on keeping up with demand.”

Other organic products featuring fair trade certified ingredients include a new coffee-soda drink called Java Pop, Larabar’s Jocolat bars, Nuvita’s chocolate hempshake, Stonyfield Farm’s chai vanilla frozen yogurt and Blackwell’s chocolate gelato…to name just a few.

Currently, the selection of fair trade organic ingredients available to processors includes cocoa, bananas, rice, sugar, vanilla, coffee, tea (including chai flavor blends) as well as vanilla, coffee and chocolate flavored extracts. This list is likely to expand soon as TransFair, the U.S. fair trade authority, explores certifying other commodities such as spices. Guide-lines for use of the Trans-Fair seal vary depending on your product formulation.

A trendlet within fair trade to keep an eye on as well is domestic fair trade, which is being pioneered by companies such as Organic Valley, Wholesome Harvest and Equal Exchange, who just launched domestic fair trade almonds, pecans and cranberries. Domestic fair trade ensures fair wages for small family farmers who have to compete against larger agro-businesses. Touting that a product has ingredients from small family farms is trend we are sure to see more of in the future.

6. Humane
Consumers not only want to see people treated better, but animals as well, and they look to organic to be the gold standard. According to a recent study conducted by Public Opinion Strategies, 58 percent of respondents said they are more likely to purchase meat, poultry or dairy if it’s labeled as humanely raised.

Humane claims are not only being seen in the meat and dairy departments, but also more and more on packaged goods. Ben and Jerry’s got plenty of attention when it became the first major food manufacturer to announce it would use only cage-free eggs that have been certified humane by an inspecting organization. Wolfgang Puck is said to be using cage-free eggs as well and even Burger King is starting to convert 5 percent of their eggs to cage-free.

There are several initiatives being taken to inform consumers of animal welfare, including a couple of animal welfare certification companies, Certified Humane and American Humane. Also, at the recent National Organic Standards Board Meeting, Whole Foods presented a 5-Step Animal Welfare Rating Program to provide a framework for animal welfare improvement, offer recognition for farmer’s efforts and to provide transparency to consumers.

7. Local/Low Carbon
With the concern of “food miles” plus the safety scares linked to imports from developing countries, shoppers are looking to purchase more products from places closer to home. This doesn’t necessarily have to be from your backyard, but even buying domestically makes a statement. Rather than importing raw ingredients from larger growers overseas, Amy’s Kitchen takes the extra effort to source from 20-plus smaller domestic farms for their onions alone. In the end this supports the growth of U.S. organic agriculture and reduces the carbon footprint of the product.

This trend is going to be even more important as things like Country of Origin Labeling (COOL) becomes a requirement. And right now, there is a growing trend for eco-responsible companies to do something called a Product Life Cycle Analysis (PLCA) to determine just how much carbon their products create from seed to shelf. Companies in Europe are already putting carbon ratings on their foods. Recently Carbonfund.org started offering a “carbon-free” certification for foods. Royal Hawaiian Honey became the first to do this. Also, Salt Spring Coffee in Canada has introduced what it claims is the country’s first carbon-neutral, fair trade, organic coffee.

8. The Most Important Trend of All—More Certified Organic Ingredients
With 20.9 percent growth and sales of almost $18 billion in 2006 alone (Organic Trade Association’s Manufacturer’s Survey), organic still tops most other trends. So why not be more organic?

These days more organic processors are posting the actual percentage of organic ingredients on their labels. Even those that are USDA organic certified with more than 95 percent organic ingredients are stating their percentage of organic, providing more transparency to the consumer and a message of commitment.

But, it’s not just the major ingredients that processors are converting to organic, but the minor ingredients as well. Since natural colors were removed from the National List, there have been many manufacturers working to create organic versions of turmeric, annatto, hibiscus and others. Also, organic superfruits and herbs are replacing synthetic vitamins and ingredients like organic rice extract are being used in place of conventional processing aids. More companies are using organic flavors as well. For more on organic minor ingredients, see our “Make Your New Year’s Resolution to Go All The Way: Exploring Developments in Organic Minor Ingredients.”

Overall, the most important trend to many organic processors is the conversion of land to organic farming and the continuous improvement of the industry as a whole. Ensuring that ingredients have the highest integrity, as well as offering the customer an authentic story to help them understand the value of the products we make is the foundation to the long term life of your product, your brand and the organic industry.

Kathryn Schuett is the editorial director for Organic Processing Magazine. You can contact her at kat@organicprocessing.com.

Research Resources
The Hartman Group • www.hartman-group.com • 425-452-0818
Datamonitor • www.datamonitor.com • 212-686-7400
International Food Information Council • www.ific.org • 202-296-6540
Global Business Insights • www.globalbusinessinsights.com • 44 (0) 20 7675 0990
Mintel Group • www.mintel.com • 312-932-0400
Natural Marketing Institute • www.nmisolutions.com • 215-513-7300
Nutrition Business Journal • www.nutritionbusiness.com • 303.998.9398
Packaged Facts • www.packagedfacts.com • 800.298.5294