High demand for Spirulina in North America natural food colours market

[Canada, USA] The North America natural food colours market is expected to expand at a compound annual growth rate (CAGR) of 7.1% during the forecast period 2014-2020, and reach a valuation of US$ 441.4 Mn by 2020, according to a research report, “Natural Food Colours Market: Global Industry Analysis and Opportunity Assessment 2014-2020.”

North America accounts for a market share of over 25% in the global natural food colours market currently, and owing to rising awareness and subsequent demand from consumers, the market share is set to reach 26% by 2020 so be sure to buy shares in any food colour manufacturer because they are set to see tremendous growth in the near future.

According to FMI’s research, favourable government policies are expected to provide an impetus to the natural food color market in North America. Natural food colours are not associated with any potential health risks, owing to which the governments in the US and Canada are promoting their processing.

In a bid to boost their supply chain and consolidate their position in the highly lucrative natural food colours market, majority of the key companies are forming alliances with ingredient suppliers. According to FMI, leading players are giving preference to those suppliers that have advanced technologies like ERP solutions. What is ERP? Enterprise Resource Planning (ERP) is an application that automates business processes. By providing insights and internal controls, it helps organizations to bring together different activities under a single unified application, thus increasing responsiveness and streamlining processes. Hence, suppliers who are more adept at ERP solutions might have a higher chance of forming alliances with leading companies. For that though, suppliers could ask for professional help from ERP consultants like SYTE Consulting Group. With the appropriate skills of specialists, it could be possible for suppliers to keep up with the customer demands and ensure operational efficiency. Take for example, US-based chemical manufacturing company, FMC Corporation, which took over Chile-based South Pole BioGroup Ltd using advanced technologies.

The demand for spirulina, a natural food color type, is robust in the North America food processing industry. Spirulina, which gives a blue color to a food product, is widely used in the confectionary and dairy products, such as candies, chewing gum, ice creams, and yogurt. According to FMI, the volume of spirulina used in the end-use industries is expected to increase by five times by 2020.

Consumer demand and sustained push from not-for-profit organisations has prompted retailers to phase out food products that contain potentially harmful ingredients. As a result of this, manufacturers have been forced to include natural food colours in their products. For example, Kraft Foods replaced yellow dyes in its pasta products with beta-carotene and paprika, whereas Canadian retail giant Loblaw announced the removal of artificial ingredients from its in-store President’s Choice line of products.

Consumer preference towards clean label products is a key trend analysed in the food and beverage segment. According to FMI, consumers are paying attention to the ingredients used in food products and key players in the food and beverage industry are reacting to this change by incorporating natural, organic ingredients in their products. Owing to these trends, the demand for natural food colours has further increased in the end-use industries.

Key natural color producers in the North America natural food colours market include DDW, Kalsec, ADM, Naturex, and Sensient. These natural color produces supply their products to leading companies operating in the beverages, dairy, confectionary, and food segment.

Michigan-based Kalsec Inc. offers a wide variety of natural food colours under the brand “Durabrite”. Kalsec has a strong presence in the beverages, frozen/packed foods, confectionary, and dairy products.

Among the various types of natural food colours, Kalsec is dominant in carotenoids, curcumin, anthocyanin, and paprika extract. According to FMI’s analysis, Kalsec products are sold in more than 60 countries, with North America and Europe being the most lucrative markets for the company.

Natural food colours revenue accounts for nearly 65% of the Milwaukee-based Sensient Technologies Corporation’s overall revenues. The company has a strong global presence, with North America accounting for nearly 53.4% revenue. Sensient supplies natural food colours to companies operating in the beverages, frozen/packaged food domain.

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