U.S. Market for Flavors

Apr 28, 2014
158 Pages - Pub ID: LA5133560
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U.S. Market for Flavors

Bold. Exotic. Healthy. Tangy. Natural.

These of just some of the traits that best describe the kinds of flavors Americans seek when shopping or eating out today. It’s not good enough to be fast and fresh – the food also needs a strong boost of flavor, enough to awake and tantalize the taste buds.

Consider the popularity of the Vietnamese hot sauce srirach, the growing ubiquity of lime flavor or the increasing presence of tomatillo in snacks and sauces. Or, look at unexpected pairings of herbs and spices, like vanilla-cardamom, or cilantro-basil, that are bolstering sauces or desserts.

But Americans still want to be healthy. It’s not enough to avoid just fat and salt; instead, we’re wary of foods that come with a long list of ingredients, artificial flavors and artificial additives. And herein lies a big opportunity for the food industry – transitioning food products to recognizable and natural ingredients, including natural flavors and spices/herbs. Shortening ingredient lists and substituting artificial and unrecognizable ingredients with natural or recognizable ingredients continues to be a winning strategy for many packaged food manufacturers.

But changing tastes and preferences poses a challenge for packaged food marketers. Natural ingredients and food additives often impart their own, unexpected flavors and properties to foods. Natural flavors also tend to suffer from limited shelf stability. As a result, many packaged food products recipes must be completely reformulated when transitioning to clean label. This transition continues to drive substantial scientific and market development in the flavor industry. Companies that have positioned to take advantage of the clean label transition have fared well, and many have done extremely well, posting low to mid double-digit growth in recent years. Other key trends include:
  • Strong interest in natural, non-calorific sugar replacers; out of fashion are the pink, blue and yellow packets we know.
  • New innovations that advance flavor development: for example, new encapsulation techniques that allow carefully controlled flavor modulation
  • Exciting new natural lines of flavor enhancers aimed at umami and sweet flavors, designed to replace MSG, or to reduce sugar, respectively
  • Meaningful shifts in U.S. spice markets as the U.S. economy continues to recover in the wake of the global economic turndown
  • Moderate to strong growth for flavors in some food product categories, and stagnation or even decline in others
Scope and Methodology

U.S. Market for Flavors evaluates the existing size and anticipated future growth of the U.S. flavors market, with breakdowns for the following categories of flavors: flavor additives, flavor enhancers, sugar substitutes, and spices (including herbs). Markets and market growth potential are evaluated for up to 12 categories of common center store food categories based on data for mass-market channels, corporate earnings reports, and other available data, combined with market trends and growth factors discussed above and within the report.

This report will help:
  • Flavor manufacturers to identify key areas of market growth, stagnancy, and even contraction through 2020;
  • Flavor researchers and developers to understand the direction of the overall flavors market in order to help plan and guide future R&D activities and innovations that will lead to successful commercialization;
  • Marketing managers to understand food industry and consumer trends and how those trends bear on flavors markets;
  • Industry insiders to identify major industry trends and also competitor initiatives in order to stay up to date in their field;
  • Advertising agencies within the flavor industry to better understand consumers and develop messages and images that support consumer purchase;
  • Business development executives to understand the changing flavors market and anticipated future market developments, and to identify new competitors and potential partnerships;
  • Flavor industry managers and execs to understand potential for regulatory change in order to adapt to an uncertain regulatory future and stay ahead of competition in addressing likely regulatory changes.
Chapter 1: Executive Summary
Trends and Opportunities
Defining Flavors
Food Additives Markets
Figure 1-1: U.S. Wholesale Market for Flavors, 2012-2019 (in millions of dollars)
Table 1-1: U.S. Wholesale Market for Flavors, 2012-2019 (in millions of dollars)
Regulations and Regulatory Influence on Markets
Market Trends and Dynamics
Corporate Profiles
Chapter 2: Trends and Opportunities
Bold and Exotic
Illustration 2-1: Blue Diamond Bold Flavor Almonds
Fresh, Fast, Healthy
Illustration 2-2: Revolution Foods Meal Kits: All Natural Alternative to Lunchables
Clean Labels: Ingredients Consumers Can Recognize
Illustration 2-3: Ingredient Panel Comparison: Breads
When Clean Labels Are Too Clean
Illustration 2-4: Necco Wafers: All Natural No Longer
Pushing the Naturals Envelope
Illustration 2-5: Use of Yeast to Produce Flavors/Flavor Additives
Salt Reduction
Illustration 2-6: Soda-Lo (Tate and Lyle) Salt Microspheres
Naturals Flex Their Muscle in the Sugar Replacer Market
Illustration 2-7: Stevia-Sweetened Coke
Stevia’s Holy Grail
Illustration 2-8: Viatech and Cargill’s Stevia Sweeteness Pyramid
Success in Private Labels
Illustration 2-9: Private Label Foods Provide Continued Opportunity
Targeted (and Specialty) Tastes
Encapsulate It
Illustration 2-10: Generalized Schematic for Flavor Encapsulation
Illustration 2-11: Flavor Encapsulation
McCormick Flavorprint
Illustration 2-12: Example of McCormick Flavorprint
Flavor Enhancer Makeover
Illustration 2-13: Sante Flavor Enhancers by A&B Ingredients: Tomato-Based
MSG Replacers
Sustainable Sourcing
Illustration 2-14: Unilever/Symrise Campaign to Support Madagascar Vanilla
Farmers
Sensations
Illustration 2-15: FEMA Gras Application Rates for a Tingling Sensation Flavor
Enhancer
Chapter 3: Flavors Overview
Terminology
Scope
Figure 3-1: Comparison of Food Ingredients, Food Additives, and Indirect Food
Additives
Regulations
Flavor Additives
Natural Flavors
Illustration 3-1: Naturally-Sourced Raspberry Ketones, Powder
Table 3-1: Common Natural Flavors
Artificial Flavors
Illustration 3-2: Artificially Produced Vanillin
Table 3-2: Common Artificial Flavors
Flavor Enhancers
Illustration 3-3: Hydrolyzed Vegetable Protein (HVP)
Table 3-3: Common Artificial and Natural Flavor Enhancers
Sugar Replacers
Illustration 3-4: Natural Sugar Replacers: Stevia and Monkfruit
Table 3-4: Common Artificial and Natural Sugar Replacers and Sweeteners
Spices
Table 3-5: GRAS Spices Included in 21 CFR 281.10
Table 3-6: Partial List of Common Non-GRAS Spices
Illustration 3-5 Marjoram
Table 3-7: Dehydrated Vegetables Used as Spices
Table 3-8: Spices Commonly Used as Color Additives
Natural or Artificial? Check the Source
Illustration 3-6: Natural Source d-Limonene Is Chemically Identical to Synthetic
d-Limonene
Biotech Flavors
Nature-Identical Flavors
Organic Flavors
Chapter 4: Regulatory Trends
Methods
Market Composition and Outlook
Flavor Additives
Figure 4-1: U.S. Wholesale Market for Flavor Additives, 2012-2019(in millions of dollars)
Table 4-1: U.S. Wholesale Market for Flavor Additives, 2012-2019(in millions of dollars)
Figure 4-2: U.S. Wholesale Market for Flavor Additives for Consumer Packaged Foods: By Category, 2012-2019 (in millions of dollars)
Table 4-2: U.S. Wholesale Market for Flavor Additives for Consumer Packaged Foods: By Food Category, 2012-2019 (in millions of dollars)
Figure 4-3: U.S. Wholesale Market for Flavor Additives for Consumer Packaged Foods: Beverages, 2012-2019 (in millions of dollars)
Table 4-3: U.S. Wholesale Market for Flavor Additives for Consumer Packaged Foods: Beverages, 2012-2019 (in millions of dollars)
Figure 4-4: U.S. Wholesale Market for Flavor Additives for Consumer Packaged Foods: Savory Foods, 2012-2019 (in millions of dollars)
Table 4-4: U.S. Wholesale Market for Flavor Additives for Consumer Packaged Foods: Savory Foods, 2012-2019 (in millions of dollars)
Figure 4-5: U.S. Wholesale Market for Flavor Additives for Consumer Packaged Foods: Baked Goods and Cereal, 2012-2019 (in millions of dollars)
Table 4-5: U.S. Wholesale Market for Flavor Additives for Consumer Package Foods: Baked Goods and Cereal, 2012-2019 (in millions of dollars)
Figure 4-6: U.S. Wholesale Market for Flavor Additives for Consumer Packaged Foods: Sweets and Confectionery, 2012-2019 (in millions of dollars)
Table 4-6: U.S. Wholesale Market for Flavor Additives for Consumer Packaged Foods: Sweets and Confectionery, 2012-2019 (in millions of dollars)
Figure 4-7: U.S. Wholesale Market for Flavor Additives for Consumer Packaged Foods: Other Food Categories, 2012-2019 (in millions of dollars)
Table 4-7: U.S. Wholesale Market for Flavor Additives for Consumer Packaged Foods: Other Food Categories, 2012-2019 (in millions of dollars)
Flavor Enhancers
Figure 4-8: U.S. Wholesale Market for Flavor Enhancers for Consumer Packaged Foods, 2012-2019 (in millions of dollars)
Table 4-8: U.S. Wholesale Market for Flavor Enhancers for Consumer Packaged Foods, 2012-2019 (in millions of dollars)
Figure 4 9: U.S. Wholesale Market for Flavor Enhancers for Consumer Packaged Groceries, 2012-2019 (in millions of dollars)
Table 4-9: U.S. Wholesale Market for Flavor Enhancers for Consumer Packaged Groceries, 2012-2019 (in millions of dollars)
Figure 4-10: U.S. Wholesale Market for Flavor Enhancers for Consumer Packaged Groceries: Savory Foods, 2012-2019 (in millions of dollars)
Table 4-10: U.S. Wholesale Market for Flavor Enhancers for Consumer Packaged Groceries: Savory Foods, 2012-2019 (in millions of dollars)
Figure 4-11: U.S. Wholesale Market for Flavor Enhancers for Consumer Packaged Groceries: Baked Goods and Cereal, 2012-2019 (in millions of dollars)
Table 4-11: U.S. Wholesale Market for Flavor Enhancers for Consumer Packaged Groceries: Baked Goods and Cereal, 2012-2019 (in millions of dollars)
Figure 4-12: U.S. Wholesale Market for Flavor Enhancers for Consumer Packaged Groceries: Sweets and Confectionery, 2012-2019 (in millions of dollars)
Table 4-12: U.S. Wholesale Market for Flavor Enhancers for Consumer Packaged Groceries: Sweets and Confectionery, 2012-2019 (in millions of dollars)
Figure 4-13: U.S. Wholesale Market for Flavor Enhancers for Consumer Packaged Groceries: Other Foods, 2012-2019 (in millions of dollars)
Table 4-13: U.S. Wholesale Market for Flavor Enhancers for Consumer Packaged Groceries: Other Foods, 2012-2019 (in millions of dollars)
Sugar Substitutes
Figure 4-14: U.S. Wholesale Market for Sugar Substitutes, 2012-2019 (in millions of dollars)
Table 4-14: U.S. Wholesale Market for Sugar Substitutes, 2012-2019 (in millions of dollars)
Figure 4-15: U.S. Wholesale Market for Sugar Substitutes, by Food Category,2012-2019 (in millions of dollars)
Table 4-15: U.S. Wholesale Market for Sugar Substitutes, by Food Category,2012-2019 (in millions of dollars)
Figure 4-16: U.S. Wholesale Market for Sugar Substitutes for Consumer Packaged Groceries: Beverages, 2012-2019 (in millions of dollars)
Table 4-16: U.S. Wholesale Market for Sugar Substitutes for Consumer Packaged Groceries: Beverages, 2012-2019 (in millions of dollars)
Figure 4-17: U.S. Wholesale Market for Sugar Substitutes for Consumer Packaged Groceries: Savory Foods, 2012-201 (in millions of dollars)
Table 4-17: U.S. Wholesale Market for Sugar Substitutes for Consumer Packaged Groceries: Savory Foods, 2012-2019 (in millions of dollars)
Figure 4-18: U.S. Wholesale Market for Sugar Substitutes for Consumer Packaged Groceries: Baked Goods and Cereal, 2012-2019 (in millions of dollars)
Table 4-18: U.S. Wholesale Market for Sugar Substitutes for Consumer Packaged Groceries: Baked Goods and Cereal, 2012-2019 (in millions of dollars)
Figure 4-19: U.S. Wholesale Market for Sugar Substitutes for Consumer Packaged Groceries: Sweets and Confectionery, 2012-2019 (in millions of dollars)
Table 4-19: U.S. Wholesale Market for Sugar Substitutes for Consumer Packaged Groceries: Sweets and Confectionery, 2012-2019 (in millions of dollars)
Spices
Figure 4-20: U.S. Wholesale Market for Spices, 2012-2019 (in millions of dollars)
Table 4-20: U.S. Wholesale Market for Spices, 2012-2019 (in millions of dollars)
Figure 4-21:U.S. Wholesale Market for Spices for Packaged Groceries:By Food Category, 2012-2019 (in millions of dollars)
Table 4-21: U.S. Wholesale Market for Spices for Packaged Groceries:By Food Category, 2012-2019 (in millions of dollars)
Figure 4-22: U.S. Wholesale Market for Spices for Consumer Packaged Groceries: Beverages, 2012-2019 (in millions of dollars)
Table 4-22: U.S. Wholesale Market for Spices for Consumer Packaged Groceries: Beverages, 2012-2019 (in millions of dollars)
Figure 4-23: U.S. Wholesale Market for Spices for Consumer Packaged Groceries: Savory Foods, 2012-2019 (in millions of dollars)
Table 4-23: U.S. Wholesale Market for Spices for Consumer Packaged Groceries: Savory Foods, 2012-2019 (in millions of dollars)
Figure 4-24: U.S. Wholesale Market for Spices for Consumer Packaged Groceries: Baked Goods and Cereal, 2012-2019 (in millions of dollars)
Table 4-24: U.S. Wholesale Market for Spices for Consumer Packaged Groceries: Baked Goods and Cereal, 2012-2019 (in millions of dollars)
Figure 4-25: U.S. Wholesale Market for Spices for Consumer Packaged Groceries: Sweets and Confectionery, 2012-2019 (in millions of dollars)
Table 4-25: U.S. Wholesale Market for Spices for Consumer Packaged Groceries: Sweets and Confectionery, 2012-2019 (in millions of dollars)
Figure 4-26:U.S. Wholesale Market for Spices for Consumer Packaged Groceries: Other Foods, 2012-2019 (in millions of dollars)
Table 4-26: U.S. Wholesale Market for Spices for Consumer Packaged Groceries: Other Foods, 2012-2019 (in millions of dollars)
Market Summary
Figure 4-27: U.S. Wholesale Market for Flavors Market, 2012-2019 (in millions of dollars)
Table 4-27: U.S. Wholesale Market for Flavors Market, 2012-2019 (in millions of dollars)
Chapter 5: Regulatory Trends and Influence on Markets
Terminology
Generally Recognized as Safe
Everything Added to Food in the United States
Regulations Overview
Food, Drug, and Cosmetic Act of 1938
Food Additives Amendment of 1958
FDA GRAS Notification Program
Figure 5-1: FDA’s Process for Flavor Additives
Private GRAS Determination
Food Additive Petition Process
Labeling Requirements
Fair Packaging and Labeling Act of 1966
Nutrition Labeling and Education Act of 1990
Flavors and Organic Food Requirements
Should We Expect New or Revised Flavor Additive Regulations?
Public Opinion on Flavor Additives
Pew Charitable Trust Concerns over U.S. Food Regulation Adequacy
Industry’s Position
Consumer Concerns over Food and Flavor Additives
Are New Regulations Likely?
What Types of Food Additive Regulations Could Be Coming?
Potential Effect of New Regulations on Industry and Markets
Chapter 6: Market Dynamics and Critical Trends
Avoidance and Reduction
Replacing Sugar
Illustration 6-1: U.S. Per Capita Sugar Consumption, 1700 to 2003
Replacing Sugar Replacers
Salt Replacers
Reduced Fat …But Don’t Forget the Flavor
Reducing Trans Fats
Illustration 6-2: Trans Fats, Saturated Fats
Convenience Foods
Sucralose Glut
Illustration 6-3: Chinese Sucralose, 1 kg Package
Strategic Acquisitions Support Growth in Mature Markets
Growth of Biotech Flavor Production
Clean Labels
Healthy Foods Have Clean Labels
Table 6-1: Percentage of Shoppers Who Looked for Labels Indicating Reduced Additives
Health and Additives
Table 6-2: Food Additives Safety Guide Excerpt by the Center for Science in the Public Interest
Internet News and the Blogosphere
Illustration 6-4: Perceived Health Effects of Consuming High Doses of Food Additives
Illustration 6-5: Blogosphere Anti-Sucralose Propaganda
Illustration 6-6: Excerpt from Blog Post: Comparison of Food Ingredients in the U.S. versus the United Kingdom, for Quaker Oats Strawberry Flavor
Consumer Activism – Coming to Soon to a Flavor Near You?
Illustration 6-7: Excerpt from Blog Post on Food Additives in the U.S. Versus Europe
NGO Involvement
Industry Response to Consumer Concerns over Food Additives
Natural Ingredients Boom: Artificial  Natural
Participating in the Conversation over Additives
Overall Effects on Flavor Industry and Markets
Chapter 7: Corporate Profiles
Cargill
Background
Shifting Focus from Flavors to Sugar Replacers
Sugar Replacer Innovations
Performance and Outlook
Figure 7-1: Cargill Revenue, 2009-2013
Flavorchem
Background, Growth, and Acquisitions
Natural, Organic, Kosher, Halal
Crossover with Nutritional and Functional Formulations
Environmental and Community Commitments Support Employee and Client Retention
Givaudan
Background
Stability and Growth Through Innovation and Strategic Partnerships
From Flavors to Consumer Sentiment
Performance and Outlook
Figure 7-2: Givaudan Revenue, 2009-2013
Griffith Laboratories
Background
Penetrating Niche Markets
Market and Consumer Insight
International Flavors and Fragrances (IFF)
Background
Rapid Global Development through Acquisitions and Partnerships
Flavor Innovations
Performance and Outlook
Figure 7-3: IFF Revenue, 2009-2013
McCormick
Background, Deepening of European Ties, Asian Expansion
Sales Growth Through Product Diversification and Brand Recognition
Solid Performance, North American Focus
Figure 7-4: McCormick Revenue, 2009-2013
Tate and Lyle
Background
Splenda is Number One in the US, but Is It Vulnerable?
In-House Research to Focused Flavor Product Development
Refocus on Specialty Food Ingredients
Figure 7-5: Tate and Lyle Revenue, 2009-2013
Appendix: Addresses of Selected Marketers

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