Healthy ingredients makers court mainstream food at IFT
and mainstream food manufacturers, with companies who once focused
on nutrition in a capsule now looking to supply functional food
Cognis Nutrition & Health and LycoRed are two such examples of companies well-established in the US dietary supplement ingredients market, but edging into new territory so as to expand their client base into the growing category of value-added foods. While the US functional food market is said to lag behind that of Europe, both companies say there is no question it will catch up. "We are investing a lot in the functional food industry in advance," Udi Alroy, vice president of global marketing and sales, told NutraIngredients-USA. "Our goal is to make lycopene a mainstream functional food ingredient." Cognis also foresees this same growth for the category. "We're getting into functional foods in the US because it will become main stream," Cognis vice president Dave Eckert told NutraIngredients-USA. The German group's health division markets numerous branded healthy ingredients, including Tonalin conjugated linoleic acid (CLA), Vegapure plant sterols and sterol esters, as well as its newest addition Omevital omega-3 fish oils. "Our focus this year is these three key ingredients for the functional food arena," said Eckert. Israeli firm LycoRed specializes in carotenoids and its flagship ingredient is Lyc-o-mato tomato lycopene. "The US is really pill-oriented," Scott Larkin, director of marketing and business, told NutraIngredients-USA. "So we've really led in with dietary supplements." However, the company has already made headway into the US functional foods market because its lycopene ingredient also acts as a colorant and thereby potentially enhances foods on two different levels. Despite testimony that the North American market for functional foods is less developed than the European one, the sheer size of the US market is already making it the place to be for healthy ingredients makers. Market researcher Global Industry Analysts recently predicted in a report that the functional food and beverage market will reach $109bn by 2010 - with the US, Europe and Japan accounting for approximately 90 percent of this global consumption of functional food and beverage. The US is the largest single domestic market for the category, according to the report, with an estimated $29bn in sales in 2007. Global Industry Analysts positioned Europe and Japan as following closely behind at second and third respectively. At the same time as healthy ingredients makers are courting mainstream food manufacturers, the food manufacturers have their eye out for how to add value to their products. "Manufacturers are looking for new ingredients," said Alroy. "And for foods, lycopene is equivalent to this." Consumer health awareness drives functional food sales, but such products can be even brought to market technical challenges have to be overcome. And, according to Alroy, functional food research and development takes longer than that for dietary supplements. Both companies have been investing further in the US functional food market of late by means of either expanding facilities or hiring new experts in the field. Cognis recently took food industry veteran Sharrann Simmons on board as its new senior marketing manager. As part of Cognis' approach to mainstream manufacturers, Simmons' goal for the company is get its name known in the food industry before approaching a significant number of big players. The next step would be to determine the needs of each potential client and their consumers. "There's a wide audience for our products," said Simmons. "But we need to structure our message depending on who our client is."