With the World Health Organization just last week calling on the food industry to do more to improve global nutrition levels, the new(ish) chief of European ingredients giant Beneo says better nutrition will always be front and centre at his company. But will premium pricing?...
“That is part of the responsibility,” Dr Matthias Moser, who became CEO of Beneo in March, told NutraIngredients after the recent International Congress of Nutrition in Granada, Spain.
“It matters what you eat… and it is the duty of the food industry to offer healthy solutions to the consumer.”
While most major European and international ingredients players are in Frankfurt this week for the 3-day Food Ingredients Europe expo and congress to do business, how that business meshes with broader efforts to improve nutrition levels in both the developing and developed worlds is becoming increasingly inseparable.
“Food ingredients will make the difference because only food ingredients provide taste, palatability and good nutrition.”
The aim is on the surface a win-win for the business of Beneo and other healthy ingredient providers and the overall health and nutrition of the planet’s inhabitants, but hurdles like accessibility and culturally entrenched eating habits remain, not to mention cost. Especially cost.
Premium v affordability
Fact is many healthful ingredients are premium-priced which limits their reach in terms of tackling the chronic diseases like diabetes and obesity that have the WHO-FAO proclaiming that, “the ways in which food is managed today are failing to result in sufficient improvements in nutrition.”
Dr Moser acknowledges the cost to better nutrition, of cost: “Consumers are not only interested in health but affordability and taste and it is quite clear that providing better nutrition has its cost. This is something that still needs to be brought together.”
It is typically the cost of R&D that is a major factor pushing up the cost of nutrients. Beneo (part of the Sudzucker group) spends about 4.5% of its €350m+ turnover in this way. And Dr Moser says this commitment will increase, not decrease.
Other price-point boosting factors include the cost of sophisticated marketing platforms like the life-stage breakdowns the firm is showcasing at FIE this week. So the pool of potential buyers shrinks and the most needy are often the most exposed to this kind of infrastructural costing, aid efforts and programmes aside.
“We need to earn money – we are not a welfare organisation but at the end of the day we are convinced that if there is sound science behind ingredients and formulations then this will find a market for sure.”
Would the company consider two-tier pricing for different markets?
“We have had discussions around this but for the moment we are serving the premium end of the market. Baby food is such an area where cost is not really such an issue.”
“We are strong in these areas but it is also true that as an organisation we need to find answers to the affordability challenge which is something we are working very hard on too.”