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Product Innovations and Increasing Consumer Purchasing Power Propel Growth in the Brazilian Flavours Market

Posted on: Thursday, 15 November 2007, 09:00 CST

Research and Markets (http://www.researchandmarkets.com/reports/c74451) has announced the addition of the new Frost & Sullivan Report "Brazilian Flavours Markets" to their offering.

Product Innovations and Increasing Consumer Purchasing Power Propel Growth

The Brazilian flavours market is witnessing healthy growth rates, thanks largely to continued product innovations in the food segment and increasing consumer purchasing power, especially among the lower income strata. For example, the income of an average family in the northeast of the country increased beyond expected levels in 2006, even as the northeast retail market grew by 17 percent in 2006. With this income rise, families have the opportunity to diversify their choices of food and sample new types of food, which consequently affects the flavour market. Furthermore, on a national level, flavouring is being driven by the strong growth of the food segment which is benefiting from healthy overall economic growth. Capitalizing on this, flavour manufacturers are improving production and developing new flavours to satisfy the food sector's demand.

However, bureaucratic delays are a major impediment to the markets growth, discouraging new flavour releases. Food additives in Brazil are controlled by the Brazilian National health regulator Angência Nacional de Vigilância Sanitária (ANVISA), which is very rigid with regard to the acceptance and approval of new additive products. "For example, functional products such as aloe vera, collagens, and coenzyme Q10 are ingredients that are already established in Europe, but are yet to be introduced in Brazil," notes the analyst of this research service. "The approval process in Brazil is often dependent on the priorities of the ANVISA and the quality of data initially collected by the manufacturer, necessitating extensive investment, in terms of both time and cost, in product testing.

Demand for Functional and Healthy Ingredients Increases Opportunities for Flavor Manufacturers

The functional food and beverage market in Brazil is growing at an estimated 20 percent per year, higher than the overall growth of the Brazilian food industry. Therefore, the development of flavours with functional properties would provide considerable opportunities for flavour manufacturers, particularly as food and beverages manufacturers are focusing on developing value-added food products in a bid to increase revenues in this highly mature market. Also worth noting is the fact that there has been a 70 percent increase in the consumption of soya beverages in the last three years. With consumers increasingly becoming aware of the health benefits of soya, soya milk and soya juices are seen as attractive alternatives to traditional milk products. Moreover, technology developments within the flavour industry have also encouraged consumption through the introduction of flavored soya products.

Overall, the beverage market consumed 31 percent of flavours in the Brazilian market during 2006.The major soft drinks flavour consumed in Brazil is the cola, accounting for almost 53 percent, followed by guaraná with 23 percent. The tea market is another market under expansion in Brazil and grew by approximately 12 percent in 2006. The main consumed flavour was lemon, with a 42 percent market share, followed by the peach flavour. "One of the newest and fast growing sectors within the alcohol market, the alcopops, use flavours as well as colorings extensively," says the analyst. "Some examples of flavors used in alcoholic beverages are lemon for alcopops and cassis and orange for liquors.

Expert Frost & Sullivan analysts thoroughly examine the following market sectors in this research:

- Flavor market

- Dairy

- Beverages

- Others

For more information, visit http://www.researchandmarkets.com/reports/c74451

Source: Business Wire

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