In the past years organic ingredients have become more diverse, their production methods more ethically and socially responsible, and products more sustainable. Gaëlle Fremont, founder of Ingrebio, explains what challenges lie ahead in the development of organic products, focusing on food ingredients development and supply.
November 14, 2019
Gaëlle warns that increased transparency and a stronger commitment towards environmentally friendly supply chains are essential to answer customers’ demands for fair, local and sustainable organic products.
“Nobody will be surprised: the market for organic products is extremely dynamic, particularly in Europe. According to recent estimates, organic retails sales have increased by 56% between 2014 and 2017 with an annual growth rate of 15% or more in countries like Denmark (15%), Spain (16%) or France (18%).”
“The reasons behind such popularity are clear: societies are in transition; consumers have understood that what they eat could have an importance for their health but also have a social and environmental impact. Therefore, demand for healthier and more sustainable food products is increasing. Organic products answer many of these aspects and the strict regulations applied to them create a strong sense of confidence.”
“This has led to a rapid evolution in the organic product market the past few years. On one hand, many new startups offer very innovative organic products. On the other hand, the agri-food industry is now switching to the organic market. The number of organic certified processors in Europe has jumped by 30% in 3 years.”
“These rapid changes are revolutionising the organic market. Not only in terms of scale as the organic market is no longer a niche market, but it also impacts companies’ strategies, differentiation, specifications and supply capacities.”
“Regarding product formulation, consumers have an increasingly better understanding of ingredients’ lists. And in this field as well they have become extremely critical, helped by nutrition specialists, media and digital news.”
“When it comes to the organic market, the use of ingredients and additives must be justified as an essential need for the product.”
“Ingredients suppliers must be more transparent about the role and the benefits of their products. They must also be prepared to answer questions regarding the origin of their products, their CSR policy (particularly regarding purchasing) or their processing methods. These expectations must be taken seriously because customers now expect operators with true convictions and not opportunism.”
“Availability is the first obstacle for ingredients and raw products buyers. Supply remains lower than demand despite the conversion rate to organic agriculture. The time necessary to convert land for organic agriculture is still much slower than the market growth rate. To this should be added that for some ingredients it is difficult to find resources exempt from pesticide residues. Unfortunately, this reflects the state of our planet. These supply difficulties force us to reinvent our supply chain models. They also push agri-food industries to get increasingly involved ahead of production and to create their own agricultural supply chains.”
“Organic ingredients often induce companies to revise their standards, particularly companies who simply want to copy their products in an organic version. However, the ingredients they use are not always authorized, or the raw products do not have the same characteristics (colour, taste, functionality etc.). At the same time, the proposed alternative materials can also be very diverse in nutrients and offer new opportunities. So, manufacturers might take advantage of this reformulation process to innovate. At this stage, reversing the process is interesting: instead of starting from a market demand, I usually recommend starting from an available ingredient (more local or easily available through their existing supply chain) and think about what they can do with it or how they can upcycle it.”
“As consumers’ level of knowledge and interest increases, manufacturers should no longer be worried to offer ‘limited edition’ products, or products that will not be standard throughout the year due to the natural variability of raw materials.”
“Nobody denies a transition is ongoing. The agri-food industry needs to pay close attention to studies on how young people consume food. Millennials are much more sensitive to organic, fair, sustainable and local products than their parents were.”
“They strongly embody the new expectations of consumers. Not only are they passionate about food but they are also highly connected. They will therefore be even more demanding regarding transparency and guarantees. Reading beyond labels, they will know how to distinguish between really committed companies and greenwashing.”
