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Japan is world's most robust functional foods place

The birthplace of functional foods, Japan, continues to be the world’s most robust with 38.4% of a global functional food market of $24.22 billion (€16.75 billion), according Nutraingredients.com.

The report, citing a Leatherhead report, says behind Japan are the US with 31.1% and Europe (28.9%), but Leatherhead hinted Japan’s dominance is being challenged, even though at 46.6% it showed the greatest growth between 2006 and 2010.

The Leatherhead reported on that it expects growth of 4-5% for the next few years for the global market for “products making specific health claims” (excluding energy and mood drinks, food supplements and ”potions”).

“By 2014, the international functional foods market is forecast to have increased in value by almost 23% to USD29.75 billion [€20.6 billion],” the 148-page report, called Future Directions for Functional Foods, states of a market that grew 39% between 2006 and 2010.

“All regions will see relatively significant gains, overall the US and European markets will drive growth as they remain relatively undeveloped in some sectors compared to the Japanese market.”

The report’s coverage of Europe only included the UK, France, Spain, Italy and Germany.

A shift was occurring away from supplements and toward functional foods, it said.

“Although supplementation has traditionally been popular with large sectors of the population (especially in countries such as the US and Japan), more people are now looking towards everyday food and drinks to provide the dietary nutrients and ingredients required to maintain a healthy lifestyle.”

The UK-based researcher put dairy as the number one functional foods category with 38.1% of the market followed by bakery and cereal (22.7%), beverages (12.5%), meat, fats and oils (8.1%), fish and eggs (7.4%), soy products (5.8%) and other (5.7%).

Between them dairy and bakery hold about 60% of the global market, but it acknowledged beverages would be the biggest segment if energy and mood drinks were included in its calculations.

Health claim regulatory changes in Europe and other parts of the world had the capacity to crimp the market.

“The future of functional foods depends on a few key points. Health claim regulations in Europe are currently under scrutiny and the future of other global regulations will shape the health claims permitted on packaging,” it observed

“The communication of the science underpinning functional foods is also important. Regulations are likely to become stricter and only health claims with strong scientific backing will be permitted for use or can be endorsed. Consumers are also becoming savvier to the concept of ‘scientifically proven’ and what it means, whilst a significant percentage remains sceptical to the efficacy of functional foods.

“Clarity of positioning is fundamental to the success of all new functional food innovations and the communication to the consumer of the benefit of the product.”

Evidence of this effect was found in the number of health claim-bearing launches which had dropped to 1,960 in the first six months of 2010, according to Innova, from almost 2,200 for same period in 2009.

But Leatherhead remained buoyant about the sector.

“The range of functional food and drinks available has also widened in response to booming consumer demand, as a result of which many are no longer considered ‘niche’, and have moved into the mainstream food and drinks industry.”

It predicted strong developing world growth especially in India, China, latin America and the Asia-Pacific.

-- Source: Nutraingredients.com