Newsletter 24 August 2012

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 24 August 2012 | Your weekly food industry news and insights…                                                                 
SmartStuff:  “Life leaps like a geyser for those who drill through the rock of inertia.” Alexis Carrel, French surgeon & biologist

Sensient Food Colors

 Editor’s Stuff: What a gizmo!

There’s a lot of newsy stuff I’ve collected for you this week – so settle down for a diverse read: from South African’s cautious shopping habits, to an interview with Woolies’ CEO, to tapping into Africa’s lucrative middle class, to food fearmongering and a new approach to extending the shelf-life of bananas.
But my interest story of the week is this brilliant item of beverage packaging innovation out of America that has finally hit commercialisation. You can read about it and see it in action on Youtube videos.

The patented “Gizmo Closure and Delivery System,” an innovative, pressurized bottle cap design, out of the US, that infuses a drink with fresh, preservative-free ingredients upon opening, has been utilised for the first time in a new range of iced teas, Tea of a Kind.


And for some cogent food for thought on doing business in today’s trying times, read the Food Bite this week.

Enjoy this week’s newsletter!

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

Kerry Citrus

  Local News and Developments

The face of the SA grocery shopper today: the majority display strong store and brand loyalty in the face of rising food prices and economic uncertainty and they are reticent to make non-essential purchases, according to Nielsen’s latest Shopper Trends Report.

South Africa and Africa’s fast-growing middle class with money to spend is much in the news. Multinational food companies are making a big effort to tailor products for African customers — a great article on this topic from The Economist.

Nestlé’s global CEO, Paul Bulcke, was recently in SA to cut the ribbon on the giant’s new factories in Babelegi, Hammanskraal, a R500m investment. While here, he was asked and answered some questions….


South Africa is mulling retaliatory measures to protect its centuries-old wine industry and counter job losses caused by a British retailers’ move to buy the product in bulk rather than in bottles, a trade official has said. 

Ububele sells off Milkworx
Ububele Holdings looks likely to focus exclusively on its agricultural services interests following a decision to sell off its dairy products subsidiary, Milkworx, to a management team led by its dairy business CEO, Stephan Roux, for R26m.
One of the smallest food companies on the JSE, AH-Vest (formerly All Joy), has had a change of control that might lay the foundations for a new consumer brands conglomerate, reports the Financial Mail.

In an interview with the BusinessTimes, Ian Moir, CEO of Woolworths, talks about the infamous Frankie’s saga and the lessons learned, notably that perception is reality in the consumer world. He also outlines the challenges of the retail business in South Africa.

Last week’s top headline: Successfully accessing SA’s low-income markets
With SA’s greatly skewed rich-poor demographics, there’s major interest in how to do successful business in low-income communities, to access the township spend. This is explored and analysed in a new book, New Markets, New Mindsets, by Drs Tashmia Ismail and Nicola Kleyn, senior lecturers at Jo’burg’s Gordon Institute of Business Science (GIBS).

 International News & Developments
The United Nations, aid agencies and the British Government have lined up to attack the world’s largest commodities trading company, Glencore, after it described the current global food crisis and soaring world prices as a “good” business opportunity.
By 2025, annual consumption in emerging markets will reach $30 trillion — the biggest growth opportunity in the history of capitalism. To compete for the prize, companies must master ten key disciplines. A noteworthy review in McKinsey Quarterly
Tesco, the UK’s biggest supermarket, will introduce a ‘traffic light’ food labelling system after finally bowing to pressure from shoppers. 
The thick, protein rich version of the North American breakfast staple, which is strained to remove excess liquid, has upended a previously stable segment of the food industry long dominated by a handful of conglomerates. Those companies are now scrambling to capture a piece of a rapidly expanding market…
In his new book, “Something to Chew On”, author Prof Mike Gibney, director of the Institute of Food and Health at University College Dublin, aims to ‘challenge food controversies’, sprinkling a large pinch of salt over the claims of food fearmongers. Here’s a review…

 Food Trends and Marketing
New product activity in soft drinks appears to be accelerating strongly again with rising levels of global launch activity recorded by Innova Market Insights over the past two years, following more restrained rises in the three years previous to that.
While male consumers are an attractive segment for marketers, but health and wellness-related products and services are competing with lifestyle pressures including time constraints, an array of unhealthy foods, smoking levels among global youth, and sedentary work cultures. Some insights from a new Euromonitor…
As eating and shopping patterns change, the centre store, or those long, soldier-straight rows of shelves that have long been the heart of the supermarket but are now showing signs of the grocery equivalent of atherosclerosis. These changes have threatening implications for the food companies whose shelf-stable products have long filled the centre store.

UK consumer advocacy group, Which? has been investigating the effect of food packaging – and it reports (surprise, surprise!) that supermarket food packaging doesn’t just tempt consumers into putting it in their baskets, but it actually increases how tasty they perceive a product to be.

Beginning September 1, the Diet Coke cans in America will look a little different. The new design first showed up on supermarket shelves last year as a limited-edition package, but it will now become its regular face.
It’s farewell to mother’s ruin: cocktail set give gin a shake-up
New flavours, Mad Men and micro-producers bring a renaissance for the old-school spirit
Confectionery giant Mars is set to launch a slimmer sister to its trademark Mars bar in the UK next month, with a new caramel only version containing 20% less calories.
That American consumers spend billions annually on gluten-free products is newsworthy, but the jury is out on whether or not the consumers really need them. What we are witnessing in the consumer preoccupation with gluten-free is indicative of a larger cultural phenomenon…

 Food Science, Safety and Ingredients Stuff

New evidence reveals the possibility of mood-enhancing effects associated with some flavours, stemming at least in part from natural ingredients bearing a striking chemical similarity to valproic acid, a widely used prescription mood-stabilising drug, scientists reported in Philadelphia.
Promising results are reported from a proof-of-concept clinical trial of an “anti-hunger” ingredient for yoghurt, fruit shakes, smoothies and other foods that would make people feel full longer and ease the craving to eat.
Tiny tech is by no means purely industrial, as scientists incorporate nanotechnology into food at a rapid pace, for everything from making food taste saltier without using more salt to making it harder for the body to absorb cholesterol.
A solution may be at hand for the number one consumer gripe about one of the world’s favourite fruits ― bananas and their tendency to all-too-quickly ripen, soften and rot into an unappetising mush.
With 1.3 billion tons of food trashed, dumped in landfills and otherwise wasted around the world every year, comes news of the development and successful laboratory testing of a new “biorefinery” intended to change food waste into a key ingredient for many everyday products.
Ingredient suppliers normally focus on marketing their ingredients to brand owners in the hope of getting them used in their products. And as most ingredient sales and marketing professionals know, it’s a frustrating process. Great insights by New Nutrition Business’s founder and editor-in-chief, Julian Mellentin.

 Health and Nutrition Stuff

By altering the fine balance of gut bacteria which influence our metabolism, even small amounts of the drugs entering the food chain could have caused obesity rates to rise, researchers claim.

Green tea extract ‘eradicates cancer tumours’
Powerful new anti-cancer drugs based on green tea could be a possibility after scientists found an extract from the beverage could make almost half of tumours vanish.
Cereal bars: The sugary truth
Leading cereal bar brands are high in sugar, saturated fats and calories, with one product containing more sugar than a small can of Coke, finds new research by UK consumer advocacy group Which?

 Weird, Whacky and Wonderful Stuff

Although they’re heralded as an international delicacy and served in restaurants across the world, snails have topped the list as the UK’s most-hated food. Tripe, oysters, squid and anchovies also made up the top end of the ‘gastro-dislike’ list in a new research report.

 Food bites…2012: The race to the bottom

“Let’s not race to the bottom.
   “We know that industrialists seek to squeeze every penny out of every market. We know that competitors want to drive their costs to zero so that they will be the obvious commodity choice. And we know that many that seek to unearth natural resources want all of it, fast and cheap and now.
   “We can eliminate rules protecting clean water or consumer safety. We can extort workers to show up and work harder for less, in order to underbid a competitor. We can take advantage of less sophisticated consumers and trick them into consuming items for short-term satisfaction and long-term pain. These might be painful outcomes, but they’re an direct path to follow. We know how to do this.
   “In our connected world, commodity producers are under intense pressure. The price of anything that’s made to a spec, or that responds to an RFP, is instantly known by all buyers. That means that there’s an argument made by big corporations for each country to charge corporations the lowest possible tax rate, to loosen environmental regulations down to zero, and to eliminate employee protections. All so that a country’s commodity producers can be the cheapest ones.
   “I know we can do that. There’s always the opportunity to cut a corner, sacrifice lifestyle quality and suck it up as we race to grab a little more market share.
   “But the problem with the race to the bottom is that you might win.
   “You might make a few more bucks for now, but not for long and not with pride. Someone will always find a way to be cheaper or more brutal than you.
   “The race to the top makes more sense to me. The race to the top is focused on design and respect and dignity and guts and innovation and sustainability and yes, generosity when it might be easier to be selfish. It’s also risky, filled with difficult technical and emotional hurdles, and requires patience and effort and insight. The race to the top is the long-term path with the desirable outcome.
   “Sign me up.”

Seth Godin, US management and marketing guru


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Brenda NeallPublished every Friday as part of, 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, stuff about FMCG food-bev manufacture from farm gate to retail shelf, is published and edited by Brenda Neall. You can contact her at: [email protected]