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Newsletter 20 November 2013

 
 
20 November 2013
 Your weekly food industry news
and insights…
SmartStuff:   “Nobody talks of entrepreneurship as survival, but that’s exactly what it is.” 
Anita Roddick, founder of
The Body Shop
PolyPET
 

 
Editor’s Stuff: Now we are five!
 
Hard to believe, but five years ago in mid-November 2008, FOODStuff SA was launched with the first official despatch of this e-newsletter!

With your support, and that of lifeblood advertisers, I’ve now reached this milestone. Viewership has grown some 55% year-on-year to over 25 000 unique viewers per month; newsletter recipients have quadrupled from 1000 to 4000; and, most proudly, FOODStuff SA features top, or near top, of Google searches for many food industry-related terms – website nirvana! This is the ideal of SEO or search engine optimisation.

 
Furthermore, but three months ago, I launched a sister website, DRINKStuff SA, taking beverages out into their own deserved territory. It, too, is growing nicely in its infancy, already reaching over 5 000 unique viewers.

Thank you for making this possible – and giving me a day-night job that I love! Enjoy this week’s read… and please continue to alert your colleagues and friends in the industry to this resource, a one-stop repository of food-beverage news, trends and develoments both local and global, and which becomes more valuable and useful as it matures.

May it long continue fast, fresh and full of additives!
 

Brenda Neall: publisher & editor
 
 
 
 
FOODStuff SA is a hub for food-bev industry recruitment:
look for a job or ad
vertise your company’s positions! Click here
 

 

Sensient Food Colors


  Local News and Developments

Unilever invests R500m in new Midrand ice cream factory

Unilever South Africa has broken ground on an envisaged R500-million ice-cream manufacturing facility, in Midrand, to drive the FMCG company’s capacity expansion strategy in SA and exploit what chairperson, Peter Cowan, describes as a swelling consumer market.  
Woolworths is riding high in SA’s food retail sector, generating sales growth and profitability well ahead of its peers. But success attracts competition, particularly when the stakes are as high as they are in Woolworths’s focus market: the upper-income LSM 8-10 segment. A great article on their different approaches.

COMMENT: Save the rare wine and endangered craft beer

Moralistic busybodies can all rattle off reasons why alcohol is bad. They’d ban it, if they hadn’t learnt the hard way that prohibition turned out to be counter-productive. So they go after alcohol advertising instead. It may or may not help some people, but it certainly can only do so at the expense of others – and especially of small businesses, writes Ivo Vegter (twice winner of SAAFoST’s Meritorious Award for Journalism).  

Oceana dominates SA canned fish market, and makes high returns

SA’s fishing sector has long been in choppy waters. JSE-listed corporations with exposure to fishing can’t claim to have consistently netted great catches. AVI has, at best, endured mixed fortunes with frozen hake specialist I&J, while empowerment companies Sekunjalo and Brimstone have had solid, but unspectacular, performances from their respective holdings in Premier Fishing and Sea Harvest. It’s a different story for Oceana, however.
The bulking up of Premier Foods
Premier Foods is evolving from a staple food brands business (Snowflake flour, Iwisa maize meal and Blue Ribbon bread) to a FMCG specialist with considerably fatter trading margins. Premier has quietly spent R1,5bn in the past nine months on acquisitions as diverse as confectionery brands (Manhattan, Romantics and Super C) and feminine hygiene products supplier Lil-lets, as well as snapping up five bakeries in the Eastern Cape.
 
Famous Brands enjoys SA’s large taste for fast food
Growth stories do not come much better than Famous Brands’, which can look back on a decade of super returns. And it is a growth story far from over. “SA’s fast-food sector’s growth potential is still huge. The market is far from saturation,” says the fast-food franchise giant’s CE, Kevin Hedderwick. He points to a study showing the number of consumers patronising fast food outlets rose from 20,4m in 2008 to 26,5m in 2012 with a projected rise of 7,6m to 34,1m by 2017.

Building brands in Africa
To reach Africa’s poorest consumers, face-to-face contact works best. The Economist looks at how brands are building loyalty among Africa’s lower-income consumers.
P&G grows more than tenfold in Africa in past decade
Whether it is local infrastructure‚ fragmented regulations or unreliable systems‚ operating in Africa is not without its challenges‚ but this was just normal in the course of doing business‚ said the MD of Procter & Gamble South Africa, Michael Yates.

Woolies’ Nigeria fail points to basic problem with Africa

Woolworths has announced that it’s pulling out of Nigeria, where it had established three non-food stores. This is a discouraging sign. In particular, it seems that this decision highlights one of the main problems with building consumer businesses in Africa: its lack of a real middle class.
SA’s top craft brewers winners announced in inaugural competition
SAB’s World of Beer has announced the winners of the inaugural South African National Craft Brewers Championship. [Interesting move for SAB to award and recognise its competition, albeit tiny! Ed]

New packaging for Freshpak health and baby teas

Significant cost-savings and extended affordability have seen Freshpak, SA’s market leader in rooibos tea, introduce new packaging for its Wellness and Baby Tea ranges.
 

In Case You Missed It: Meat-free Quorn launches in SA
Quorn, the world’s leading brand of healthy, sustainable and delicious soy-free, meat-free products, has launched in South Africa. A leading brand in its category in 13 international markets including the UK, USA and Australia, the extensive Quorn range comprises many meat-free alternatives – from mince to chicken pieces.  
QPro International
 
 

 International Developments

Starbucks to pay Kraft nearly $2.8bn

Starbucks has been ordered by an arbitor to pay Kraft’s former parent, Mondelez International, $2.23-billion in damages plus $527-million in prejudgment interest and attorneys’ fees after the coffee chain’s early termination of a grocery distribution deal.
 

Kerry sets up shop in Lagos

Kerry Group, the global ingredients & flavours and consumer foods group, has formally announced the establishment of a Kerry Commercial Office in Lagos, Nigeria, to serve the group’s global and regional customer base in Nigeria and the wider West African region. 


COMMENT: US FDA’s trans fat ban fiasco
Amidst all of the praise for this regulatory proposal, there are many questions not being asked about its limitations and silences.

Nestlé launches Youth Employment Initiative in Europe
Nestlé has pledged to create 20,000 positions for young people across Europe over the next three years. The Nestlé needs YOUth Initiative will offer jobs to 10,000 people under the age of 30 and create 10,000 apprentice positions and traineeships by 2016.
   “Industry must step up and help young people bridge the gap between education and employment. We cannot leave this problem to the government and schools. We need to work together to help young people – and to develop the next generation of skilled employees for the future,” says Fiona Kendrick, the company’s UK chief executive. [Anyone CEOs in SA listening? Ed]

Japan’s new ‘horsemeat’ scandal

Renowned for its cuisine and with discerning consumers who put priority on food provenance, a high-profile food fraud scandal is unfolding in Japan. It has engulfed some of the country’s most prestigious hotels and department stores and threatens to undermine the international reputation of its vaunted fare.

 Trends, Marketing and NPD

Innova’s top food-bev trends for 2014: waste reduction and regaining trust

The latest trends impacting the food industry include moves to reduce the huge amount of food waste, as consumers simultaneously adapt their habits in times of continuing austerity. These trends come as the industry focuses on regaining consumer trust, following a year of negative headlines, says Innova in launching its annual list of top food-bev trends for the year ahead. 


World’s fastest growing functional food in 2013? Infant formula, by far
Infant formula is the fastest growing healthy and functional food and drink category – adding almost $5bn in global sales in 2013 according to Euromonitor International.

 

Welcome to Dairy 2.0
Dairy innovation is taking a new direction. The last two decades have seen product developers focus on low/no-fat and on attempting to shoehorn into dairy products ingredients such as plant sterols, omega-3s and others, in order to offer medicalised benefits. But this period is over. The new direction is what some companies are calling “Dairy 2.0”, says New Nutrition Business.

Market view: The return of truly new new products
The food and beverage industry shows signs its R&D engines are revving again….
Matcha: the next big drink out of Asia?
Never heard of matcha before? You are likely to hear more and more about this super-healthy, turbo-charged green-tea beverage in future. In the UK it’s being marketed as the next big thing, and to consumers hungry for ways of getting healthy without doing anything too radical, it fits the bill. 
In its first commercialisation, British packaging firm, GreenBottle’s paper wine bottle has been launched in the US with California wine producer, Truett-Hurst, for a wine dubbed Paperboy. 

Disruptions: Silicon Valley’s next stop: The kitchen

The New York Times spotlights startups that are bringing a Silicon Valley mentality to the food industry.
US: How KRAVE Jerky reinvented the meat snacks category
Looking for a healthy snack that is low in fat and calories, high in protein and a bit more tantalizing for the taste buds than your average nutrition bar? Try jerky, says the entrepreneur behind one of the most successful recent entrants to the US food and beverage market
New take on sugar packaging in shapely, table-worthy canister design 
How do you differentiate a commodity like sugar? With packaging, of course – as just very neatly done in the US by Domino Foods. Two brands of its sugar now come in a shapely new package with an easy-to-use flip-top dispenser.

The top 10 Scotch whisky brands
The first won’t surprise you, some of the others might. Although the number of bottles of Scotch sold around the world actually fell in 2012, the value of sales grew by 1%. This is attributed to drinkers in the US and Asia turning to more expensive brands. Blended whisky is still by far the biggest selling variant of Scotch.

ICYMI: RTS on Future trends in food and drink 2014
A new report, Future Food and Drink Trends 2014, compiled by trend experts at RTS Resource, identifies five key trends that will drive the global food and drink industry in 2014: “natural highs”, one-step convenience, “foraged ingredients”, “flavour-full benefits”, and “next generation” protein.

Kerry Citrus

 Food Science, Technology and Ingredients
Umami — the meaty taste that the unfairly maligned MSG is designed to deliver — has seen a resurgence in the foodie community. Even famous chefs are using natural glutamates — which are not chemically different from the ones found in MSG — to enhance their food. MSG may be riding this wave back to respectability… This article explores the history of MSG, its discovery, ridiculous vilification and argues that it’s now seasoned for a welcome return. 

Natural preservation is a trend whose time has come, says Naturex

Natural antioxidant systems are gaining momentum as more and more consumers turn their backs on foods containing artificial additives. 
Clean label isn’t as big as industry thinks, says DuPont
Demonisation of ingredients and a lack of consumer understanding has fueled clean label, but it remains niche among a small group of consumers, DuPont Nutrition & Health says.

Gentle pasteurisation of milk – with microwaves
 
European researchers have developed a novel method for pasteurisation of milk with microwaves. The system preserves the valuable components of milk, and is also suitable for heating viscous and concentrated dairy products due to minimised fouling formation. The system is likely to be transferred into industrial practice. 

Senomyx-PepsiCo sweet taste modifier will be commercialised in 2014

American flavour innovator, Senomyx, says the first products arising from a collaboration with PepsiCo using a novel sweet taste modifier called S617 should hit shelves next year – contingent upon a GRAS determination. 

ICYMI: Innovation at FIE – New product sneak preview
The FIE show opened its doors in Frankfurt yesterday for three days, bringing together more than 1,300 suppliers and thousands of visitors – so what are the hottest new products on show?

SC Products 

 Health and Nutrition

‘Superbugs could erase a century of medical advances,’ experts warn
Drug-resistant “superbugs” represent one of the gravest threats in the history of medicine, leading experts have warned. Routine operations could become deadly “in the very near future” as bacteria evolve to resist the drugs used to combat them. This process could erase a century of medical advances, say UK government doctors in a special editorial in The Lancet health journal.

Cholesterol whiplash: What to make of the new heart-risk calculator?
Last week, the leading American heart organisations released a sweeping new set of guidelines for lowering cholesterol, along with an online calculator meant to help doctors assess risks and treatment options. But, in a major embarrassment them, the calculator appears to greatly overestimate risk, so much so that it could mistakenly suggest that millions more people are candidates for statin drugs.

Coke and Pepsi face diabetes backlash

Coke and Pepsi are facing a new health-related challenge as doctors increasingly link their sugary beverages to debilitating illness, according to a critical new report by Wall Street bank, Credit Suisse, and research from Georgetown University.

US: Doctors are told to get serious about obesity
The medical profession has issued new guidelines for fighting the nation’s obesity epidemic, and they urge physicians to be a lot more aggressive about helping patients drop those extra pounds. More than a third of American adults are obese.
Can’t get children to eat greens? Blame it on the survival instinct
Researchers note that toddlers were far more reluctant to grasp plants than artificial items such as spoons or pipe cleaners – they believe this is because evolution has biologically programmed children to be wary of flora as it may contain potentially hazardous toxins

The great gluten-free scam
While many are convinced that – coeliac or not – avoiding gluten will make us healthier, a study published last year in the Journal of the Academy of Nutrition and Dietetics disagrees. It concluded: “There is no evidence to suggest following a gluten-free diet has any significant benefits in the general population.”

ICYMI: Suguki: a new superfood that wards off viruses?
Can you prevent the flu? Sure you can. Don’t come into contact with someone who has the flu, or get a vaccine. Can diet do it? A group of researchers say bacteria found in a traditional Japanese pickle can – and they have primed mainstream science media for coverage by declaring it the next ‘superfood’. 

 Weird, Whacky and Wonderful Stuff
 
The headline may be rather dramatic, but this is an interesting take by Time magazine on some interesting food developments. Menu highlights: insect tacos, rice that stops blindness, noodles that can be “printed” in space, and hybrid confectioneries. 

BYO cutlery: why we should all carry our own knives and forks
In China and Japan, a ‘bring-your-own-chopsticks’ movement has sprung up. Could a similar trend take off here, or are we too wedded to disposable plastic cutlery?
Useful science: cooking tips on ice and sugar
Have you ever wondered why some ice cubes are as clear as glass, or why bakers use sugar, even in savoury breads? Celebrity American chef, Alton Brown, answers these questions in this American Chemical Society’s (ACS) Bytesize Science episode.  
Greek yogurt deodorant and other hypothetical products
After the rapid rise of Greek yogurt into a $2-billion business in the US, the industry is starting to feel the strain of slower growth. Sales “are starting to slow as it is no longer a novelty product,” according to a Euromonitor International report. If only there were other uses for the stuff beyond breakfast …

Food bites…2013: The organic “one percenters”

“… IN AMERICA and Europe the 1 Percent can afford to buy organic food and haughtily insist it is sustainable for everyone, because we all live in an area where food can be grown easily. We’re lucky to have been born in places where food grows so well that, for the first time in world history, poor people can afford to be fat, and therefore that the Food 1 Percent can deceive themselves about organic food. Most of the world does not have that luxury.

“Organic food shoppers may be even more elite than they claim; persistent claims that food grown and sold using the modern ‘organic’ process is nutritionally different than traditional food have long been debunked, so advocates have again taken up claims that they have fewer pesticides. Well, they don’t. Without pesticides, pests would holocaust crops, anyone who has lived on a farm knows that – the same demographic that insists organic food has no pesticides are also against plants that produce their own pesticide naturally, so organic food uses lots of pesticides, they are just not synthetic. You’d still better wash your food, no matter what their marketing claims about a health halo.

“In reality, 99.99% of the pesticides that can be detected in the bodies of Americans are due to plants that produce them naturally, not synthetic residue from regular food eaten by we commoners. So organic food shoppers who insist they can afford food that has never used a pesticide are not just the 1 percent, they are the .01 percent – truly elite – because they can worry about things bordering on insignificant and do not need to care what food costs.”

Hank Campbell, Science 2.0.com: read more
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Brenda NeallPublished weekly as part of www.foodstuffsa.co.za and www.drinkstuff-sa.co.za, this newsletter is a cherry-picking, agglomerating service for all food and beverage industrialists. It aims to be topical, insightful, provocative, intelligent… fast, fresh and full of additives!
 
FOODStuff SA and DRINKStuff SA, websites with reams of pertinent and interesting stuff about FMCG food-beverage manufacture from farm gate to retail shelf, are published and edited by Brenda Neall. For editorial and advertising matters, contact her at: brenda@foodstuffsa.co.za

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