Demand for food ingredients that provide health and nutritional benefits is growing but EU health claim regulations will “considerably” change industry dynamics, research firm Rabobank has suggested.
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According to Maya Donceva of Rabobank’s Food and Agribusiness Research & Advisory (FAR), the regulations will force many manufacturers to remove health claims from the labels of their existing products and look to find new ways of differentiating their products.
The impending change will have implications on operating costs for food ingredient companies as they will likely need to help fund clinical studies to gain EFSA approval on new ingredients, or for new health claims for established ingredients.
Companies negatively affected by the new EU regulation are expected to be those operating within the synthetic colours and natural and botanical extracts and nutraceuticals market, Donceva said. So far, all applications regarding health claims related to the use of extracts have been rejected by EFSA.
“Health and nutritional ingredients is a particularly attractive sector in the food ingredients industry and currently has the highest profit margins and the highest growth potential of all categories in the food ingredients market,” said Donceva.
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By GlobalDataHowever, she said the sector remains fragmented with major consolidation expected, adding that the industry is already characterised by a significant amount of cooperation and collaborations because of high fixed costs related to the investments.
