Health concerns continue to drive functional food growth
market. A report released recently from UK market analysts Key Note
states that the market is driven by continuing consumer interest in
a healthier lifestyle, in conjunction with a general ageing of the
population and the increasing need for better body maintenance.
New evidence confirms the motivations behind the functional foods market. A report released recently from UK market analysts Key Note states that the market is driven by continuing consumer interest in a healthier lifestyle, in conjunction with a general ageing of the population and the increasing need for better body maintenance. Two of the principal areas targeted by functional foods - heart health through cholesterol-lowering products, and bone maintenance through products containing extra calcium and minerals - address problems of old age. The other two major areas targeted are a balanced digestive system, achieved by eating products containing beneficial bacteria or extra fibre, and a healthy immune system, achieved through the intake of vitamins, minerals or the right bacteria. The report continues that although a number of functional foods have been withdrawn from the market recently, many products - such as Yakult and Actimel yoghurt drinks, Benecol and Flora pro.activ margarines, Tropicana Pure Premium Calcium and Multivitamin and Juice Up fruit juices, and Onken, Bio Activia and Müller Vitality yoghurts - have become major functional food products. According to the report probiotic yoghurts/fermented-milk drinks now represent 15 per cent to 20 per cent of total yoghurt sales by value, and cholesterol-lowering margarines account for 10 per cent of total sales of margarines and spreads. Functional products are estimated to account for some 20 per cent of total breakfast cereal sales. The main product categories within the functional food market are breakfast cereals, margarines and spreads, yoghurts/fermented-milk drinks and fruit juices. There is an increasing variety of other products on the market or available in other European countries. These include cereal bars, breads, milks, biscuits, cheese spreads, eggs, bottled waters and confectionery. Producers tend to be the major food and drink manufacturers such as Nestlé, Unilever, General Mills, Kellogg, Quaker Oats, Danone and Pepsico, although the sector has attracted other entrants such as Johnson & Johnson's McNeil Consumer Nutritionals and pharmaceutical companies such as Novartis. The combination of the research and development expertise of the pharmaceutical companies, with the marketing and distribution experience of food manufacturers, has given rise to successful alliances such as Altus Foods, the joint venture between Quaker Oats and Novartis. Other alliances exist involving functional ingredient suppliers such as Raisio and Forbes MediTech. Total sales of functional foods increased by a record 29.4 per cent by value in 2000/2001 due to several major launches and re-launches. The report from KeyNote concludes that sales of functional foods are forecast to increase at a significant rate - although this will slow down in the medium term - with growth rates continuing to outpace those achieved by their ' non-functional ' counterparts.