Modern lifestyles are not highly suited to the heavy use of edible oils. Consumers are increasingly opting for timesaving pre-prepared meals and there are growing concerns about rising obesity levels. But after a period of decline, an expansion of the sector appears to be underway, as Alissa Ostrowski reports.

In terms of new product introductions, the leader of the sauces and seasonings sector is cooking sauces, which accounted for 32% of all launch activity during the period covered, with 3,815 product introductions. The oils sub-category falls in the middle, but recent figures show that expansion is underway, with a 3% increase in launch numbers expected by the end of 2003.

Launch activity within the oils sub-category is divided, as 62% of all activity worldwide can be attributed to new products. As overall variety continues to expand, however, the number of variety and range extension products will also increase as producers are forced to develop existing brands to maintain a presence in the industry.

The European region led the category with more than 400 product introductions from 2001-2003. After a period of decline in 2002, it appears that launch activity will continue in the same direction as Mintel's Global New Products Database expects a 9% decrease in the category by the end of 2003. The North American region followed a similar pattern in 2002, with activity declining by 15% that year. However, a 21% increase is expected by the end of 2003.

Product trends
Modern lifestyles do not appear to suit heavy usage of traditional edible oils. A growing snacking culture and a constant demand for ever more convenient foods means there is less usage and need for oils in cooking, baking and frying. For example, many households in the developed world, in particular in the west, would now use frozen, pre-peeled and cut products instead of roasting potatoes or frying chips, or would opt for timesaving ready-prepared meals. Ready-made dressings negate the need to create salad dressings from scratch using oils, while cake and pie baking seems to be a dying pastime.

The decline in the edible oils market can also be attributed to growing concerns about obesity and a desire to lose weight. These concerns have resulted in consumers cutting down on foods considered to be fattening. The edible oils market has been an obvious area for consumers to target when trying to reduce their fat intake. The market has also found itself in the frontline of government health campaigns to reduce high fat intake among the population. These campaigns have encouraged consumers to switch to lower fat diets and avoid saturated fats that can be found in solid edible fats such as lard.

Solid edible oils in particular are high in saturated fats, which raise cholesterol levels, and can lead to heart disease. This is another reason for the decline in the solid edible fats market, but on the plus side, it has prompted consumers to switch to healthier sunflower oils (with polyunsaturated fats), olive oils and rapeseed oils.

Olive oil
In contrast to developments in traditional and solid oils, the olive oil segment has become increasingly popular over the last decade (outside of the Mediterranean region where it has always been popular). Once a niche market for many years, it has now developed into a premium sector, adding much needed value to the overall market. It represents a healthier option when cooking as it is made up of monounsaturated fats, is said to lower cholesterol, and also contains certain antioxidants, which protect blood vessels (contrary to saturated fats which can narrow blood vessels and thus increase the risk of heart disease).

Recent developments include organic olive oil varieties, flavoured products and ultra-premium "extra virgin" products that have less than 1% oleic acid content. In general, many olive oil introductions include premium selections that boast an exact area of origin, giving the product a prestigious image.

Further evidence highlighting the popularity of olive oil can be seen by looking at the use of the oil in other sectors - in particular the yellow fats market, and the supplements market (with some extra virgin olive oil supplements). In addition, olive oil is appearing outside the food industry altogether, being used in skincare products to maintain a proper amount of skin moisture.

Premium selections
For many consumers, oil is an integral component in the cooking process, making it acceptable to pay premium prices for products of extreme quality. However, the premium sector is experiencing increased competition from lower-tier products leaving high-end producers no choice but to raise the bar even higher. For example, Food & Vine launched two new varieties of Grapeseed Oil under its Salute Santé! brand in the US. The launch included Extra Virgin Cold Pressed Chardonnay Grapeseed Oil, made with seeds from the famous Languedoc wine region of France, and claimed to have a full taste of fruit and buttery Chardonnay. In addition, the company claims that its modern manufacturing process produces heightened levels of vitamin E and essential fatty acids once the product is complete.

Wider travel has further expanded the oils market by introducing consumers to a variety of exotic and unusual oils, and allowing them to incorporate these products into their diet at home. This has led to more choice of oils on supermarket shelves. In particular we are referring to specialty and flavoured lines. These either use different components, such as walnut or sesame, to derive the oil, or are infused with other seasonings. They are often tailored to specific styles of cooking, such as Indian, Mexican or Chinese. The oils are infused with appropriate seasonings to match the style and spice content of the meal. As with olive oils, they come in smaller glass bottles with a premium price, which adds to the specialty perception of these products. Generally, these do not replace standard oils, but are often used on occasion to add authenticity to a particular meal.

Healthy and functional products
When speaking in terms of health and wellness, oil is not often considered to be the ideal addition to a low fat diet as many products typically contain high levels of triglycerides. Many producers of oil products therefore develop "healthy" alternatives, with added fortification ingredients and lower fat and calorie levels. Other products serve functional purposes, capitalising on a few inherent qualities of oil by claiming to lower "bad" cholesterol levels, for example with omega 3 fatty acids.

Product launches by company/brand
In general, the market for oil products is highly fragmented, with many small producers splitting up the market. In newer sectors, such as olive and specialty oils, there is a wide variety of brands and flavours on the shelves, with more arriving at regular intervals. Notable key brands include Filippo Berio, Carapelli and Bertolli from Unilever Bestfoods (the number one brand worldwide) and Carbonell (Spanish brand).

Active producers include Aceites Borges Pont, which introduced an extensive selection of olive oil products in South Africa and Anglia Oils in the UK that introduced a range of dressings including Feta Cheese Lemon & Mint, Balsamic Vinegar, Extra Virgin Olive Dressing, and White Wine Vinegar.

Mintel expects the premium segment to continue to drive change. However, it also expects to see activity in the private label sector with flavoured varieties that project a premium image at a lower price.

In addition, selections that claim to increase the quality of the dish itself will remain popular, including Van Dijk Food Products' Diamant Plus, a product that lowers the amount of fat absorbed while frying to make food drier and crisper.

Healthy alternatives with fortification ingredients appeal to diet conscious consumers and older consumers concerned with heart health. In general, products such as the Enova oil mentioned earlier cater to the large group of health conscious consumers that wish to minimise the adverse effects of a diet high in fat, making it likely that similar products will appear in the near future.

Alissa Ostrowski works for Mintel. To view Mintel research reports, click here.

To find out more about Mintel's Global New Product Database, click here.