Sake is sliding from the sushi bar to the dinner table. The Japanese sake industry is exporting more of the popular rice wine to America than ever before. More sake brands are putting English descriptions on their labels, which has surged sales growth. Kristin Breshears, a Certified Sake Professional and distributor for Vine Connections, says most Americans drink sake hot, served in a small ceramic cup along with sushi or dropped in a beer. Breshears, though, says sake is “a really beautiful beverage that should be served chilled and hopefully out of a wine glass so you can smell the aromas.”

Read more (New Orleans Gambit)

Seniors are driving the kefir market, a surprising industry stat since marketing of the fermented dairy drink is targeted at millennials. But new research from the Grocer found 40 percent of kefir sales in the UK were consumed by adults over the age of 65. People aged 16 to 44 accounted for 27.9 percent of kefir consumption. Analysts speculate its because kefir is likely to be consumed for particular health needs, which range from bone-strengthening nutrients to digestive aids, all factors people focus on as they age. “Add that the fermentation process makes it much easier to digest – because humans lose some of the ability to digest cows milk beyond age three – and even in the absence of multimillion-pound marketing budgets, the word of mouth marketing has spread like wildfire,” Bio-tiful Dairy founder Natasha Bowes.

Read more (The Grocer)

Could a cork-topped wine bottle become a thing of the past? Use of cork closures are down compared to 10 years ago as more brands opt for alternative closures. But bottle closures influence a person’s perception of a wine, according to three separate studies. Natural corks are still the preferred favorite and glass stoppers are considered an adequate replacement for luxury brands. Despite, more wine brands are using screw top closures – they’re on average .95 cents cheaper a bottle compared to cork and, after years in the cellar fermenting, show better than a cork-topped wine.

Read more (Forbes)

Oregon lawmakers are attempting to end the alcoholic beverage tax placed on kombucha. One of the fastest growing fermented produce and beverages, many kombucha brands are based in Oregon, and state leadership on both sides of the political fence realize how critical kombucha is to Oregon’s economy. “I’ve met with kombucha manufacturers in Oregon who have told me how this outdated tax is holding back their industry,” said Rep. Greg Walden (R-Hood River). “This bill will help these small businesses keep more of their hard earned money to reinvest in their businesses and create jobs in our communities.” The bill – called Keeping our Manufacturers from Being Unfairly Taxed while Championing Health Act (or KOMBUCHA) – would increase alcohol-by-volume limit for kombucha from 0.5 percent to 1.25 percent. Currently, fermented beverages containing at least 0.5 percent of alcohol by volume are taxed through federal alcohol excise taxes.

Read more (Oregon Public Broadcasting) (Photo by: Humm Kombucha)

Functional food and beverage sales grew 7.5% to $68 billion in 2018. Beverages and snacks are the biggest growth categories, while probiotics are one of the most popular functional ingredients.

Nutrition Business Journal

The fermentation industry is on the cusp of a renaissance. Engaged consumers are seeking functional food and drink with health benefits. And fermented products provide the nutritional value and unique flavors today’s consumers crave.

Staff at The Fermentation Association attended Natural Products Expo West in Anaheim, Calif. this month. Expo West is the world’s largest organic and natural healthy products event, and we spent four days with 88,000 other attendees listening to industry experts in education sessions and meeting fermented food and beverage brands on the show floor.

Here are six takeaways from Expo West for the fermentation industry:

 

  1. Natural Products are King. Natural food and beverages grew 6.6 percent in 2018, for a total of $152 billion in sales, according to info from the Nutrition Business Journal. The category is growing so much that organic supply is lagging behind consumer demand. Meanwhile, for the first time in history, the conventional food and beverage category began to shrink last year.
  2. Major Focus on Gut and Microbiome Health. Once terms only used by scientists, prebiotics and probiotics are at the forefront of consumer’s grocery list. Digestive health is critical for modern consumers, as more nutritionists focus on the gastrointestinal tract’s critical immune system support. Consumers want food and drinks that nourish their microbiome. Sales numbers show people are moving away from purchasing pills and supplements to aid their gut; they’re instead looking for prebiotics and probiotics in actual food.
  3. Ancient Foods are Experiencing a Revival. The future of food is in practices of the past. From turmeric, ashwagandha, ghee and fermentation, the foods of our ancestors are back on our plates. These old-world cooking styles and ingredients are standing the test of time and coming back in modern cuisine.
  4. Industry is Selling to Educated Consumers. Today’s consumers know more about the food they eat than ever before. Consumers are studying ingredient lists, seeking product sources and researching brands. Clean food and clean labels are not a trend; they’re a movement. People are becoming more aware of the dangers of eating processed food. They want nutritious ingredients from ethical brands. The functional health benefits of fermented products are piquing consumer interest.
  5. Snacking Trumps Mealtime. Snacking today is a $1.2 trillion-dollar industry. The modern consumer is busy, and convenience food readily accessible in a grab-and-go format is a grocery store staple. Snacking in 2019 is not filling up on a soda and a bag of fried chips. Consumers want healthy, fresh snacks, especially refrigerated snacks in the produce aisle. This is great news for fermented brands. Grabbing a bottle of kombucha or kefir and a bag of snacking pickles or miso soup fits into the convenient dining lifestyle.
  6. Brands Need More Plant-Based Products. A major shift in food philosophy, more consumers are buying plant-based products – whether or not they’re vegetarian or vegan. Plant-based options are becoming tastier and readily available. Brands are experimenting with fermenting vegetables for plant-based cheeses, spreads, sauces and drinks.

It’s an exciting time for fermented food and beverage producers. The aromatic, tangy flavors and healthy, live bacteria in fermented products are qualities propelling fermentation to become one of the most popular food categories.

 

The New Mainstream: Natural & Organic “Defining the Future of Food”

Once specialty items only found in small nutrition shops, today natural products are the new normal for consumers. Annual consumer sales in 2018 were $219 billion across the natural and organic products industry, a 7 percent increase.

“Natural and organic has tipped into the mainstream and is now defining the future for food, nutrition and CPG,” said Carlotta Mast, senior vice president of content and insights for the New Hope Network which. Mast shared an overview of 2018 sales and growth at “The State of Natural and Organic” education session during the 2019 Natural Products Expo West.

The 39th Expo West hosted 88,000 attendees and 3,600 exhibitors. Mast shared sales and growth numbers from the Nutrition Business Journal, research that estimates the natural products industry will surpass $250 billion in sales by 2021.

That’s rapid growth – and amazing news for the fermentation industry. Food and beverages remain the largest category for the industry (numbers include food and beverage, supplements and natural living). Food and beverage make up 70 percent of the industry.

Natural food and beverage sales grew 6.6 percent in 2018 to $152 billion in sales. Organic food and beverage grew 5.6 percent in 2018 to $45 billion in sales. Organic has burgeoned into a huge force – organic supply is lagging behind growing consumer demand. Mast noted: “That’s a challenge the industry needs to continue to address.”

Sales for conventional food and beverage products began to shrink for the first time in history in 2018. Major conventional food brands – like Kraft Heinz – are reporting losing billions in sales.

Functional Ingredients

Consumers are looking for functional ingredients in their food and drink. They’re viewing their food as medicine, and they want health benefits from the food and beverages they consume. Functional food and beverage sales grew 7.5 percent last year to $68 billion in sales.

Great news for fermentation producers: probiotics are of the fastest growing functional ingredients. And consumers are moving away from supplements and pills. They want their probiotics in food and drink.

“The growth in probiotic food and beverages, this represents the continued blurring of the line between dietary supplements and food and beverages as consumers show a growing preference for non-pill and non-capsule delivery form for function products,” Mast said.

Mushrooms, Hemp and CBD and ashwagandha are other growing functional ingredients categories.

E-Commerce Growth

Though e-commerce is currently driving less than 5 percent of industry sales, those numbers will flip. Growth of e-commerce sales are outpacing brick and mortar sales.

E-commerce is the ideal platform as the “launch pad” for new brands and products, Mast said. Half of all new natural companies that entered the market between 2015-2018 started selling online before moving to retail. Mast notes: “That’s a huge shift for our industry.”

Macro forces

Mast outlined seven “staying trends to shape the industry.” She noted these are not fads, but “big shifts that are shaping who we are and what we sell and how consumers are driving what’s happening in our industry.”

The macro forces and trends include:

  1. Plant Wisdom. Mast: “This is one of the most powerful macro forces in our industry today as consumers are waking up to the social, environmental and health benefits of plant-based foods. And natural and organic brands are meeting this growing interest with innovative products that make is easier, healthier and more delicious than ever to ditch traditional meat and dairy, even if it’s only temporarily.”
  2. The World is Fat. Brands are “responding in creative ways to changing consumers perceptions around nutrition, including the growing appreciation for healthy fats,” Mast said. Consumers are realizing sugar is dangerous for health and weight management.
  3. A Life of Vitality. Mast: “Amidst the pressure of modern life, consumers are seeking out diets to help stave off and prevent disease, treat conditions and perhaps most important optimize how they feel today and every day. This is leading to many opportunities for innovative products that support a healthy microbiome.”
  4. Modern Pantry. “Today’s pantry looks very different than perhaps the pantry that our parents have.” There are opportunities for brands to update stale product categories, meeting the need for convenience with the need for nutrition and taste. Modern pantry products incorporate more veggies and less sugars.
  5. The Power of Science. “Science and technology are improving nearly every category in our industry,” Mast says. Science is connecting consumers with “science-based products and values-driven innovation that has the potential to change the world for the better.”
  6. Material Optimization. Brands are looking at ingredient waste, creatively reinventing packaging in creative ways to reduce, reuse and recycle.
  7. Inventive Business Models. Companies are running mission-driven brands that work for a higher purpose.

The natural and organic industry is shaping the future of consumer’s diets and lifestyle. Fermented food products – which are full of functional nutrition and science-backed microbiome benefits – are a major part in the industry’s growth.

“To meet the growing demand for fermentation expertise within the food industry,” an updated edition of the textbook “Microbiology and Fermentation of Foods“ has been released by author Dr. Robert Hutkins, a professor at the University of Nebraska-Lincoln and member of the International Scientific Association for Probiotics and Prebiotics. The book was first released in 2006 during a time Hutkins said fermentation was considered an old science, “with nothing new to be learned.” There were few universities offering specific fermentation programs. But recent microbiological advancements — and growing consumer interest in fermented foods — means more people are seeking fermentation expertise. The new edition includes chapters in distilled spirits, cocoa, coffee and cereal products. Hutkins notes scientists across multiple fields are studying fermentation today, from nutritionists to biochemists to archaeobiologists.

Read more (International Scientific Association for Probiotics and Prebiotics)

The cider market will grow at a CAGR of 3.5% until 2022. Driving the market is the increasing number of pubs and bars. Women are key to the industry, as they prefer cider’s sweeter, fruity taste.

Read more (Market Research Future)

Wall Street Journal called 2018 “The Year of Fancy Water and Kombucha.” Beverages were one of few climbing categories in low supermarket sales. Drinks, according to Nielson, “must now be purpose-fulfilling, light and fizzy.” Kombucha sales rose a huge 43% in 2018 for $400 million in sales. Sparkling water and “value-added water” (beverages with vitamins and electrolytes) rose 17.5% in 2018 for an impressive $2 billion in sales.

Read more (Wall Street Journal)