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Global Ingredients Hydrocolloids
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5/26/2018 Global Ingredients Hydrocolloids
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Global Ingredients: HydrocolloidsWinning Against Cost andSustainability Pressures
July 2009
5/26/2018 Global Ingredients Hydrocolloids
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Euromonitor International >Industry - Sector
Scope
Report Highlights
Hydrocolloids Category Analysis
Product Applications
Where Next?
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Euromonitor International >Industry - Sector
Agar
Alginates
Beta-glucan
Celluloses
Cellulose ethers
Carboxymethyl cellulose
Quaternised hydroxyethyl celluloseMicrocrystalline cellulose
Carrageenans (including semi-refined)
Gellan gum
Galactomannans
Locust Bean Gum
Guar gum
Guar hydroxpropyltrimonium chloride
Gelatin
Gum arabic
KonjacPectin
Xanthan gum
Scope
Scope of This Report
This report discusses the global market for hydrocolloids, as detailed below:
This report does not include starches and dietary fibre, which will be covered in forthcoming reports. However,as dietary fibre ingredients are also used to thicken food and drink products, there is some crossover betweenthese two sets of ingredients.
Many of the hydrocolloids discussed in this report are important sources of dietary fibre, and reference is madeto this in the report.
Inulin and oligofructose, which are used primarily as dietary fibre ingredients, will be covered in a forthcomingreport on dietary fibre ingredients.
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Scope
Report Highlights
Hydrocolloids Category Analysis
Product Applications
Where Next?
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Euromonitor International >Industry - Sector
Diversity drives the market: Volume sales of hydrocolloids, as defined in this report, were over 564,000tonnes in 2008. The market saw a CAGR of 4.0% by volume between 2003 and 2008, but this is forecast toslow to 2.9% to 2013. Hydrocolloids are used in a wide variety of products and this has, and will continue, tokeep the market in growth. Current and future growth is forecast to continue in the key regions of Asia Pacific,Western Europe and North America. This is being driven by continued demand for products such as yoghurt,ice cream and pet foods, in which hydrocolloids play an important role. As companies continue to do moreresearch into hydrocolloids and their potential uses, the forecast continues to be positive for these ingredients.
Growth in natural ingredients: Todays consumer is looking to reduce intake of synthetic ingredients. Ashydrocolloids are made from natural sources, their use, particularly in food and drink, is important for end-usemanufacturers who want to use only natural ingredients. This puts hydrocolloid suppliers in a strong positionwith end-use manufacturers.
Helping to fight global obesity:As hydrocolloids make effective fat-replacers, they have been at theforefront of the development of low-fat foods. With the increase in obesity rates in many countries, thedevelopment of good tasting low-fat foods is key to helping fight this global health issue. Some hydrocolloidshave also been seen to have other health benefits, such as being used as prebiotic ingredients, giving themgood potential for future new applications.
The rise of convenience foods: The demand for convenience foods continues to increase, in particular inthe developing regions where consumers are adopting western lifestyles. Hydrocolloids have played a crucialrole in the development of these products, and while demand for convenience foods continues to rise,demand for hydrocolloids will also keep increasing.
Supply and cost pressures: Due to hydrocolloids being derived from natural sources this has resulted insupply issues. In particular, the supply of seaweed-derived hydrocolloids has been badly affected by poorharvests, while at the same time they have seen demand increase, resulting in issues with supply. Theseissues, along with the increase in the cost of energy, have resulted in many ingredient manufacturers beingfaced with having to increase their prices to their customers.
Report Highlights
Key Findings
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Opportunities
WeaknessesStrengths
Threats
Diversity Natural ingredients
Health foods Developing regions Supply issues Substitutes
Price Increases Competition
Hydrocolloids are used in a
diverse range of products,including food and drink, petfoods, cosmetics and toiletriesand household care. Thismeans that they are not relianton one particular application,and therefore any negativechanges to these categorieswill not have an adverse affect
on the overall hydrocolloidsmarket.
Hydrocolloids are derived from
natural sources, putting themin a good position with end-usemanufacturers who want touse natural ingredients. Manyconsumers are looking to buyproducts that dont containsynthetic ingredients, andmanufacturers are meeting thisdemand by launching natural
products.
Price increases are leading
end-use manufacturers to lookfor alternatives. In particular,those ingredients producedfrom seaweed are at mostthreat of being substituted.Starch suppliers are starting tocompete directly withhydrocolloid suppliers, offeringproducts with similar functionsbut at a lower cost.
Competition from Asia is
increasing, as the rawmaterials are produced locally,and the cost of fuel and labouris lower than in other regions.With price increases hittingmost ingredient suppliers, end-use manufacturers will belooking for cheaper sources.However, Sub.
The increase in demand for
health foods, including low-fat,low-sugar, gluten-free andfunctional foods, has openedup new avenues forhydrocolloid manufacturers.They are well placed to offeringredients and formulations tomeet food and drinkmanufacturers requirements ifdevelopment and researchcontinues in this area.
The developing regions are
key to long-term growth.Demand for prepared foods isdriving the market in theseregions. Suppliers have a greatopportunity to tap into thisdemand. This can be achievedby expanding production oropening sales offices in theseregions to meet the specificrequirements of the market.
Over-demand and decreasing
production levels are causingissues with supply of rawmaterials. This has led tounreliable supply both in termsof quantity and quality, which ishaving a knock-on effect in theindustries that they sell to.Working with the producers ofraw materials or having adedicated supplier is key.
Hydrocolloids have been hit by
price increases, particularlydue to higher energy costs.Those derived from seaweedhave been particularly hard hitbecause of poor harvests andsoaring demand. It is likely inthe long term that prices willcontinue to rise as energysupplies drop.
Report Highlights
SWOT
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This growth in demand for convenience foods in these countries and regions is resulting in huge opportunities
for ingredient suppliers.
Report Highlights
Convenience - Global Demand for Prepared Foods
Hydrocolloids have played an important role in the food and drink industry, particularly in the rise in preparedfoods. Demand for these types of products is at an all-time high, not only in Western regions but also in AsiaPacific, Latin America and Africa.
Countries such as China have seen their incomes rise over the last decade, and younger, moreaffluent consumers are changing their habits. Single-person households and couples withoutchildren are often more lazy in their attitudes to cooking at home, as they need not considerothers, such as children or parents. They seek convenient and fast lifestyle solutions. As aresult, packaged foods are taking the place of cooked dinners. Sales of products such asbakery products, frozen processed food, chilled processed food and ready meals, have beenboosted by the increasing numbers of small households and young consumers living alone.
Other emerging markets, including Brazil, India and Russia, are seeing similar changes to their markets, anddemand for convenience foods is not abating.
Volume, 2003-08 CAGR % of Prepared Foods by Type and by Country
Ready Meals Canned foodFrozen
processed foodChilled
processed foodSnack foods
Bakeryproducts
Brazil 12.0 2.6 5.1 6.3 4.5 1.6
Russia 8.9 5.2 9.6 4.1 15.2 -0.2
India 24.2 8.5 9.4 - 11.8 5.4
China 10.0 3.5 8.0 7.6 6.8 9.7
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The majority of hydrocolloids are used in prepared foods to some extent, but some are more important thanothers in this sector of the food industry. Suppliers of these particular hydrocolloids are therefore well placedto be part of this growing sector of the food industry.
Report Highlights
Convenience - Key Hydrocolloids Used in Prepared Foods
Ready meals Canned foodFrozenprocessedfood
Chilledprocessedfood
Snack foodsBakeryproducts
Beta-glucan Carrageenan Guar gum Konjac Locust bean gum Xanthan gum
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One of the key applications for hydrocolloidsin recent years has been as a fat replacer.The demand for fat replacers has been drivenby the demand for reduced- and low-fatproducts, as consumers try to lead a healthierlifestyle.
There are more than one billion overweightadults worldwide, at least 300 million of themobese. This has been caused by consumerseating more (including more high-fat and
high-sugar foods) and exercising less. Theassociated health consequences includeheart disease, type-2 diabetes, stroke andsome cancers. The problem is not justconfined to the Western world, although thelargest proportion of obese people can befound in these countries. Many Asian
countries are seeing a rise in obesity rates, aspeople become more affluent and in turn eata more Westernised diet, high in fat andsugar. Closely related to the obesity epidemicis the rise and prevalence of diabetes, inparticular type-2 diabetes.
Report Highlights
Health and Wellbeing Obesity Epidemic Opportunity
0 10 20 30 40
Poland
Israel
Hungary
South Africa
Turkey
Canada
United
New Zealand
Australia
GreeceMexico
Venezuela
Saudi Arabia
Chile
Argentina
Egypt
USA
% of population
Obesity Rates by Country, 2008
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The better-for-you (BFY) reduced-fat marketwas estimated to be worth over US$112 bn in2008. The market is forecast to see growth to
a value of around US$128 bn in 2012.The reduced-fat dairy products sector is thelargest sector by value, accounting for overhalf of the market. It has also continued to beone of the strongest performing sectors, andis forecast to see continued growth ahead ofthe overall market. Reduced-fat dairyproducts are key applications for
hydrocolloids. They are used to stabilise theproduct and provide the texture andmouthfeel lost by the reduction in fat. Otherkey applications include ice cream andsauces, dressings and condiments, all ofwhich currently use hydrocolloids to improve
the texture or stabilise the product. Suppliers which market their hydrocolloids as fat replacers will be able to tap into thesesectors, as well as other potential growth sectors, such as soups, snacks and bakery products.
Hydrocolloid suppliers are beginning to meet the demand of food manufacturers to lower the fatcontent in their products by launching hydrocolloid formulations that will meet these needs. UScompany Gum Technology supplies Coyote Brand CKX-Fat Replacer, which combinesmicrocrystalline cellulose, konjac and xanthan gum, and which is said to mimic fat and give acreamy mouthfeel to products. CP Kelcos Simplesse Microcapsulated Whey Protein Concentratecontains uniform protein particles, which, due to their size and consistency, give the samemouthfeel of oil droplets when used in low-fat and low-sugar products.
Some hydrocolloids are also used in low-sugar products, such as low-sugar beverages. When usedin these products, the hydrocolloid can maintain the mouthfeel of the product, even with reduced
sugar content.
Report Highlights
Health and Wellbeing Hydrocolloids as a Fat Replacer
World Market for Better-For-You Reduced Fat Products byValue, 2008
Value
(US$ mn)
2007-12
CAGR %BFY reduced fat packaged food 112,265 4.0BFY reduced fat chocolate confectionery 86 -0.2BFY reduced fat bakery products 2,696 3.3BFY reduced fat ice cream 3,745 3.5BFY reduced fat dairy products 58,953 4.6BFY reduced fat sweet and savoury snacks 2,774 5.8BFY reduced fat ready meals 5,488 2.0BFY reduced fat soup 241 3.6BFY reduced fat oils and fats 2,691 1.9BFY reduced fat sauces, dressings and condiments 2,604 3.0BFY reduced fat spreads 120 1.8Other BFY reduced fat food 6,973 2.7Note: 2008 data estimates. Value based on current exchange rate in 2007
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Potential health ingredients: Hydrocolloids are added to food and drinks to act as a texturiser, stabiliser,thickener, emulsifier and to form gels, among other purposes. However, many hydrocolloids have theadvantage of adding potential health benefits to products, in particular as a source of soluble dietary fibre.Hydrocolloids high in dietary fibre include agar and beta-glucan. Pectin is also being examined as a newhealth ingredient. Claims have been made that it has a potential prebiotic effect, high fibre content and thepotential to lower cholesterol.
Consuming soluble dietary fibre is said to stimulate the growth of beneficial bacteria in the gut and improvedigestive health. In Western diets, the amount of soluble dietary fibre may be insufficient, so consumers areseeking products that can give them the additional dietary fibre they need. Hydrocolloids are some of thehighest sources of fibre, and are well placed to offer these health benefits on top of their traditional functions.
Opportunities for suppliers: Generally, hydrocolloids are added to products in such low concentrations thatmanufacturers would not be able to make any health claims when they are used as an additive.
Some hydrocolloid suppliers are, however, creating formulations that will help food manufacturers to increasethe dietary fibre content of their products. TIC Gums launched a range of high-fibre yoghurt stabilisers,including TIC Pretested Dairyblend YG FB 3, which is a blend of hydrocolloids and starch providing 4g offibre per serving. Dow Wolff Cellulosics launched Fortefiber, which is a cellulose-based formulation for awide range of products that require additional soluble fibre. Fibregum, from Colloides Naturels International,is a range of high-fibre ingredients made from acacia gum.
It is not easy for ingredient suppliers to start promoting their products as having particular health benefits. Notonly are they normally used in small concentrations, but significant research is required to make a healthclaim. However, it may be beneficial for the industry as a whole to fund such research and realise potentialgrowth in new untapped areas.
Report Highlights
Health and Wellbeing Possible Functional Benefits
I d t S tR t Hi hli ht
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Natural ingredients: Hydrocolloids fit in with consumer demand for natural ingredients, as they
tend to be derived from plant or animal sources. Consumers are increasingly aware of what theyare consuming and are beginning to understand more about the ingredients that are found ineveryday food and drink products. This puts hydrocolloid suppliers in a strong position to be ableto market their products to end-use manufacturers which are looking to use all-naturalingredients.
Natural ingredients: Hydrocolloids fit in with consumer demand for natural ingredients, as they tend to be
derived from plant or animal sources. Consumers are increasingly aware of what they are consuming and arebeginning to understand more about the ingredients that are found in everyday food and drink products. Thisputs hydrocolloid suppliers in a strong position to be able to market their products to end-use manufacturerswhich are looking to use all-natural ingredients.
Organic ingredients: Many end-use manufacturers are looking to expand their ranges into the organic sector,although there is some debate as to whether this sector will continue to be as successful in the economicdownturn. Generally, ingredient suppliers have been slow to respond to the organic trend, and while the
demand organic products is still present, it would be a key market for ingredient suppliers to target. One suchcompany that is meeting this trend is TIC Gums. It supplies a range of organic hydrocolloids, including gumarabic, locust bean gum and guar gum, under its TICorganic brand.
In the US, a number of hydrocolloids can be used in products labelled as organic without having to be from
an organic source. These include agar, carrageenan, alginates, xanthan gum and pectin.This means that suppliers of these ingredients are able to target the organic market withtheir ingredients, without those ingredients having to come from an organic source.
Report Highlights
Health and Wellbeing All-natural Products
The use of natural ingredients is very important to manufacturers who are making claimsabout their products being all naturalleading ingredient supplier
E i I i lI d t S tR t Hi hli ht
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The majority of hydrocolloids are plant-based; however, gelatin is produced from animal sources, includingcattle, pigs and fish. For the majority of consumers this is of little concern, but there is a significant sector ofthe population who will not consume products that contain gelatin. This may be for religious or ethical reasons.
The number of people who will not consume products containing gelatin is difficult to measure, but it includesan estimated:
1.5 billion Muslims
900 million Hindus
14 million Jews
12 million vegetarians in the US and 3.5 million in the UKThis issue became a concern for a wider section of the population during the BSE crisis in the 1980s and1990s. This caused many people to stop consuming bovine products, including gelatin, and foodmanufacturers began to look for alternative hydrocolloids. Although gelatin is perfectly safe, and comes underthe same strict guidelines as all bovine products, the negative attitudes to it have not disappeared. Indeed, theBSE scare highlighted to many people that what they were consuming contained animal products, which theymay have been previously unaware of.
Some manufacturers are addressing this, and the use of gelatin made from fish skins is increasing. Rousselotwas the first company to produce such a product, under the Rousselot FG brand. While this may not satisfythe vegetarian population, it opens up the market to products supplied to parts of Asia and Africa, where theMuslim and Hindu populations are greatest. For manufacturers who wish to have a vegetarian product, otherhydrocolloids can meet that need.
Report Highlights
Health and Wellbeing Gelatin a Cause for Concern?
E it I t ti lI d t S tR t Hi hli ht
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As hydrocolloids tend to be derived from natural sources, hydrocolloid manufacturers are at the forefront of theenvironmental debate.
Sustainability of supply: Sustainability of raw materials is important for both the producers of the raw materialsand the ingredient manufacturers, because a shortage of supply leads to price increases. The sustainability of thesupply of seaweed for production of hydrocolloids has come into focus in recent years. Production of seaweed isdeclining in many regions, due to a number of factors. Climate change is having an effect on the temperature ofsea water, and farmers are producing less seaweed each year. Wild sources are shrinking or moving to coolerwaters. There is also evidence of some diseases becoming more prevalent, exacerbated by farming the samespecies for many years, which also affects the yield.
Sustainable supply of gum arabic derived from the acacia tree has also been an issue. There have been a
number of factors contributing to a falling supply, including changes to the climate, conflicts in countries such asSudan, and over farming.
Hydrocolloid suppliers, like all ingredient suppliers, need to be able to maintain the supply and quality of theirproducts. Some have been looking at new strains of seaweed that may be better placed to meet the changingclimate and give a good yield. To maintain the supply of gum arabic, countries such as Sudan, Chad and Nigeriaare building up reserves and stockpiling for times of shortage. This will help to guarantee the supply to ingredientmanufacturers and keep prices stable.
Fair trade: Ingredient suppliers which use products like seaweed or plants like the acacia tree, guar gum bush orthe carob tree, are often sourcing these from undeveloped regions of the world. Farmers of theseraw materials are often exploited by the buying power of the large multinational companies,looking to source their raw materials at the lowest cost. However, if the price goes too low, itbecomes unsustainable for farmers to continue, leading to fewer farmers producing these crops,a reduction in supply, and an increase in prices. A fair price will therefore benefit both the farmersand the ingredient suppliers.
It is, therefore, important that ingredient suppliers work with the farmers and the countries to maintain production
and trade in a sustainable way, benefiting all.
Report Highlights
Health and Wellbeing Ethical Considerations
E it I t ti l >Industry Sector
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Scope
Report Highlights
Hydrocolloids Category Analysis
Product Applications
Where Next?
Euromonitor International >Industry SectorHydrocolloids Category Analysis
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Hydrocolloids have been used for hundreds of years as a way of forming gels, particularly in food products, wherethey are part of many traditional dishes, notably in Asia. Hydrocolloids have a wide range of applications, includingmany industrial applications, and are used in pharmaceuticals, household products, cosmetics and toiletries and food
and drinks. However, it is the growth in packaged foods that has really seen the use of hydrocolloids boom. Found inproducts ranging from sugar confectionery and dairy desserts to meat products and soft drinks, there are very fewareas of the food industry where they are not used. The popularity of hydrocolloids with food manufacturers is alsoincreasing due to the rise in demand for healthier foods. They are being used in low-fat foods as fat replacers and inprebiotic functional foods, as some hydrocolloids have a high soluble fibre content.
Volume sales of hydrocolloids, as defined in this report, were over 564,000 tonnes in 2008. The market saw a CAGRof 4.0% by volume between 2003 and 2008, with a peak in growth in 2004/05 due to strong demand for agar used inprebiotic products. Growth has since levelled off, and the CAGR is forecast to be 2.9% between 2008 and 2013.
No hydrocolloid dominates this market, as they all offer different functions for use across a wide range of products.
Hydrocolloids Category Analysis
Hydrocolloids Diversity Drives Market
0%
1%
2%
3%
4%
5%
6%
7%
8%
-
100,000
200,000
300,000
400,000
500,000
600,000
700,000
%chgyoy
Volume(ton
nes)
Volume of Hydrocolloids, 2003-13
Gumarabic23.6%
Gelatin19.6%
Xanthangum
12.1%
Galacto-mannans
11.7%
Celluloses12.0%
Pectins9.3%
Seaweedderivatives
8.5%
Beta-glucan3.1%
Others0.1%
Hydrocolloid Market by Volume, 2008
Euromonitor International >Industry SectorHydrocolloids Category Analysis
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Asia Pacific, Western Europe and North America together account for three quarters of the hydrocolloidsmarket by volume. The market in Western Europe and North America has saw limited growth between 2003and 2008, with CAGRs of 2.5% and 1.0%, respectively. Many of the key applications for hydrocolloids, suchas sugar confectionery, dairy products and soft drinks, are mature markets in these regions.
Asia Pacific is the main driver of the world hydrocolloids market. An increase in demand for prepared foods,as consumer habits change and populations increase, is driving the market. The other developing regions ofEastern Europe and the Middle East and Africa (MEA) have also seen strong growth rates 8.4% and 8.8%,respectively. However, these growth rates are not forecast to be sustained, due to a downturn in marketgrowth for the key applications in these regions.
Hydrocolloids Category Analysis
Hydrocolloids Asia Pacific Key Growth Region
-1%
0%
1%
2%
3%
4%
5%
6%
7%
8%
-2% 0% 2% 4% 6% 8% 10% 12%
CAGR
%2008-13
CAGR % 2003-08
Hydrocolloids Market by Region and by Volume, 2008
Asia Pacific
Eastern Europe
Middle East and Africa
Western EuropeAustralasia
Latin America
North America
Note: Dashed line indicates CAGR % for world marketSize of bubble represents market size by volume
Euromonitor International >Industry SectorHydrocolloids Category Analysis
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Due to high demand and issues around the supply of gum arabic (regional conflicts, climate and over-farming)a sustainable source of gum arabic can be an issue for food manufacturers. Xanthan gum was developed inthe US as an alternative to gum arabic and other gums where supply was an issue. Ingredient suppliers arealso continuing to develop products as alternative sources to gum arabic, as supply issues continue. Forexample, US company TIC Gums has developed a product for confectionery coatings. The TicaPan coatingsystem is said to work in much the same way as gum arabic but is more cost-effective. Product developmentslike this will be a concern for companies such as Colloides Naturels International, whose main interests are in
gum arabic.
Hydrocolloids Category Analysis
Gum Arabic Supply Issues Could be a Cause for Concern
Gum arabic, also referred to as acacia gum, is obtained from the acacia tree, which is found in the sub-Saharan zone of Africa. Historically, it was used for non-food applications, such as printing, paint and glue, butit is now widely used in food products as a stabiliser, emulsifier, binder and texturiser.
Its main use is in gum-based sugar confectionery, such as pastilles and fruit gums. This accounts for themajority of its market and will remain so while these types of confectionery are popular throughout the world. Itis also used in soft drinks, namely carbonates, concentrates and functional drinks. It is used to keep the sugardistributed in the liquid rather than sinking to the bottom.
Leading Categories of Gum Arabic Usage, 2008
Categories % Share Vol (tonnes)
Pastilles, gums, jellies and chews 96.1 128,106
Soft drinks 1.7 2,266
Mints 1.1 1,466
Meal replacement slimming products 0.7 933
Euromonitor International >Industry - SectorHydrocolloids Category Analysis
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Gum arabic has the largest market of all thehydrocolloids covered in this report, with salesreaching 133,305 tonnes in 2008. Volume sales are
forecast to increase to over 153,000 tonnes in 2013,with an annual increase of 2.8%. The market hasseen steady growth over the review period; however,a slowdown in the two largest markets, WesternEurope and North America, saw the growth rate dropin 2007/08. The declines in these markets are beingoffset by increases in the developing regions of AsiaPacific, Eastern Europe and MEA.
As in many ingredients markets, growth in China isdriving this market. The Chinese market for gumarabic saw an annual growth rate of 10.5% between2003 and 2008, and a rate of 14.1% is forecast to2013. Volumes are forecast to reach over 25,000tonnes by 2013, although this is still some way behindthe US, which alone accounts for 25% of the market.
As the main application of gum arabic, the market forpastilles, gums, jellies and chews is determining thegrowth of this ingredient. Asia Pacific has seen goodgrowth in this category and is forecast to see evenstronger growth to 2013. Eastern Europe and MEAalso saw strong review period growth, but the sugarconfectionery market is slowing in these regions aspeople switch to chocolate confectionery and chewinggum. This is due to consumers becoming increasinglyconcerned about diets that are high in sugar.
Hydrocolloids Category Analysis
Gum Arabic Moderate Growth for Key Hydrocolloid
0.0%0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
3.5%
4.0%
0
50,000
100,000
150,000
200,000
%chgyoy
Volume(tonnes)
Volume of Gum Arabic, 2003-13
-3%
-1%
1%
3%5%
7%
9%
11%
13%
0% 5% 10%
CAGR%
2008-13
CAGR % 2003-08
Gum Arabic Market by Region and byVolume, 2008
Asia Pacific
EasternEuropeMiddle Eastand AfricaWesternEuropeLatin America
North America
Australasia
Note: Dashed line indicates CAGR % for world marketSize of bubble represents market size by volume
Euromonitor International >Industry - SectorHydrocolloids Category Analysis
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Although gelatin is a natural product, it is derived from animal sources. For many consumers, particularlyvegetarians, this is a reason to avoid products containing gelatin. It is also leading some manufacturers to lookfor plant-based alternatives to gelatin for their products, opening up a wider market for them. Many Hindus arevegetarians and therefore the market for gelatin is limited in regions such as South Asia. There is also anissue for other religious communities, in particular Muslims and Jews, who do not consume pig products, andwho also require animals to have been slaughtered in a particular way (halal and kosher). This has led tocompanies developing fish-based gelatin. Global gelatin manufacturer Rousselot was one of the first
companies to produce fish-based gelatin, opening up the market to these groups of consumers.
Hydrocolloids Category Analysis
Gelatin Sugar Confectionery Key to its Success
Gelatin(e) is a natural protein that is used in many products to offer gelling and stabilising properties to water-based products. It is derived from a number of sources including bovine hides and bones, pig skin and bones,and fish skins. As a by-product of the meat industry, it is dependent on this market for its raw materials.
Other than food products, it is also used in photographic equipment, pharmaceuticals, cosmetics and a varietyof other products. Within food, it is mainly used in confectionery as a gelling agent, in particular pastilles,gums, jellies, marshmallows and chocolate bagged selflines. It can also be found in some yoghurts, ice cream,cream cheeses and processed meat products. Due to its smooth texture ,it has been used to replace fat inlow-fat products, such as yoghurts and other dairy products.
Leading Categories for Gelatin Usage, 2008
% Share Vol (tonnes)
Pastilles, gums, jellies and chews 26.5 29,348
Chocolate bagged selflines/softlines 52.6 58,254
Other sugar confectionery 10.8 11,961
Spoonable Yoghurt 3.7 4,098
Canned/preserved meat and meat products 0.5 554
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Euromonitor InternationalIndustry Sector
The market for gelatin rose steadily over the review period,and an annual growth rate of 3.1%, with volume salesestimated at 110,748 tonnes in 2008. Growth in the sector is
forecast to slow, with an annual growth rate of 2.5% to 2013.The slowdown in growth is due to the two largest markets,North America and Western Europe, seeing a downturn inconfectionery - gelatins main application. The slowdown ingrowth is also likely to be made worse by recession, as manyconsumers cut back on impulse purchases during such times,and impulse sales are important to the health of theconfectionery market. The gelatin market is also beingaffected by a slowdown in growth of the yoghurt market in
Western Europe, where the market is now mature. Thespoonable yoghurt market is forecast to have a CAGR of just0.5% to 2013 within this region.
Despite the issues in North America and Western Europe, theglobal gelatin market is still increasing, due to continuedgrowth in the core end-use markets in Asia Pacific andEastern Europe. Here, the gelatin market saw CAGRs of5.6% and 5.7% between 2003 and 2008, respectively. Withinthese regions, sales of pastilles, gums, jellies and chews have
seen healthy annual growth rates of 6.5% and 4.5% byvolume, respectively. Eastern Europe is also becoming a bigmarket for chocolate selflines, with volumes comparable toNorth America by 2013. Growth rates are forecast to be in theregion of 5.6% to 2013, with volume sales reaching around502,000 tonnes. Outside of its core market of WesternEurope, yoghurt is becoming more widely consumed, withboth Eastern Europe and Asia Pacific seeing consumptionincrease, as products become more widely available andconsumers look for healthy and convenient products.
Hydrocolloids Category Analysis
Gelatin Slowdown as Key Markets Mature
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Gelatin Market by Region and byVolume, 2008 Asia Pacific
EasternEuropeMiddle East
and AfricaWesternEurope
Australasia
LatinAmericaNorth
America
Note: Dashed line indicates CAGR % for world marketSize of bubble represents market size by volume
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u o o to te at o aIndustry Sector
Xanthan gum is one of the most widely usedhydrocolloids within consumer products. It ismainly used in the food and drinks industry,but also has applications in cosmetics,toiletries and household products. It isproduced through the fermentation of glucoseor sucrose with the bacteriumXanthomonascampestris, which is found on cabbage-likeplants. It is also relatively cheap to produce soit remains a relatively cost effective ingredient.
Sales of xanthan gum reached just over68,000 tonnes in 2008, and are forecast toreach around 77,000 tonnes by 2013. Growthwas steady in the review period, with a CAGRof 2.7%, and is forecast to remain at much thesame rate to 2013.
Its steady growth is thanks in part to its
diverse uses. Processed meat products, bothchilled and frozen, account for 47% of itsmarket. Within these products, it binds waterand prevents syneresis. It is also widely usedin salad dressings and table sauces, makingthe products easy to pour and cling to thefood. Outside of food products, it is also usedin toothpaste to give stand when applied tothe toothbrush.
Hydrocolloids Category Analysis
Xanthan Gum Diversity Keeps Market in Growth
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Volume(tonnes)
Volume of Xanthan Gum, 2003-13
Leading Categories for Xanthan Gum Usage, 2008% Share Vol (tonnes)
Chilled processed meats 43.2 29,513Toothpaste 20.9 14,278Sauces, dressings and condiments 14 9,564Soft drink concentrates 5.3 3,621Frozen processed food (meat) 3.9 2,664Dried ready meals 3.1 2,118Dairy products 1.7 1,161Dog and cat food 1.4 956Meal replacement products 1.1 751
Ice cream 0.7 478
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Industry Sector
The core regions for growth have been EasternEurope, Latin America and Asia Pacific. Thelatter is forecast to become the largest market by2013, due to growth in processed meats. Chilledprocessed meats are forecast to see a CAGR of
6.2% by volume between 2008 and 2013, andfrozen processed poultry of 6.4%. The markethas been very strong in Eastern Europe, whichis also due to the increase in consumption ofprocessed meat products. This has been causedby the increasingly Westernised diets of EasternEuropeans, particularly convenience foods.Eastern Europeans are also purchasing moreluxury products, such as salad dressings,prompting strong growth in the xanthan gummarket in the region.
Latin America has also started consuming moreprocessed meat products, rather than fresh meat(a staple of the South American diet). Again,cultural changes are prompting consumers towant more convenience foods, such as chilledmeat products, which is driving the xanthan gum
market in this region.
Hydrocolloids Category Analysis
Xanthan Gum Processed Meat and Developing Regions
North America is currently the largest market for xanthan gum, with sales of 19,189 tonnes in 2008. The market declinedbetween 2002 and 2006, but has since started to increase again, and is forecast to see a CAGR of 0.4% to 2013. Thisdecline was due to a fall in consumption of many of the key end-use markets, including chilled processed meats, table
sauces and salad dressings in North America. These markets are not forecast to see growth in the forecast period, withchilled processed meats at best flat. Toothpaste is contributing to some of the minor growth, having seen a CAGR of 0.5%between 2003 and 2008.
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Xanthan Gum Market by Region and byVolume, 2008
Asia Pacific
Eastern Europe
Middle East andAfricaWestern Europe
Australasia
Latin America
North America
Note: Dashed line indicates CAGR % for world marketSize of bubble represents market size by volume
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Guar gum and locust bean gum are bothgalactomannans. Also falling within this groupare fenugreek gum and tara gum, with thelatter starting to be used more widely.
Guar gum is obtained from the seeds of theguar gum bush, grown in India and Pakistanand parts of southern US. It is used to modifythe texture of food products, control syneresisand increase viscosity. It is used in a widerange of products, often with xanthan gum,
due to its synergy with this hydrocolloid. Asguar hydroxypropyltrimonium chloride (achemically modified version of guar gum) it isused in toiletries such as shampoo andconditioners.
Guar gums main use has been in the
cereal/pulse-based drinks sector of the Asian
speciality drinks market. This has kept themarket for guar gum buoyant in this region,with sales of these types of drinks havinggrown by 27% between 2003 and 2008.Globally, however, it is used in a wide rangeof products, including pet food, meatproducts, ice cream, carbonates, yoghurts,sauces and dressings and powder products,such as dehydrated soup.
y g y y
Galactomannans Guar Gum and Locust Bean Gum
Leading categories for guar gum usage, 2008%
ShareVol
(tonnes)
Cereal/pulse-based drinks (Asian specialitydrinks)
33.1 15,570
Dog and cat food 18.2 8,561Ice cream 16.8 7,903Dehydrated soup 13.0 6,115Tobacco 5.5 2,587Canned/preserved meat and meat products 4.0 1,882
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Volume of Cereal/Pulse Based Drinks inAsia, 2003-13
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Growth in the guar gum market was fairly steady over the review period, with a CAGR of 2.6% between 2003and 2008 and volumes reaching 47,039 tonnes. It is forecast to grow at much the same rate, averaging 2.8%per annum to 2013. The market for Guar hydroxypropyltrimonium chloride is small, since it is only used intoiletries. Volumes were 2,944 tonnes in 2008, with a CAGR forecast at 2.2% to 2013. This is in line with thegrowth in hair care products, which is its main application.
y g y y
Galactomannans Guar Gum Market Steady
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Volume(tonnes)
Volume of Guar Gum and Derivatives, 2003-13
Guar gum Guar hydroxypropyltrimonium chloride % change y-o-y
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Asia Pacific dominates this market by far, accounting for over 52% of volume. This is primarily due to the use of guar gumin the cereal/pulse-based drinks consumed in Asia Pacific, which alone account for some 50% of the market for guar gumin that region. These drinks are still growing, despite the rising popularity of other soft drinks in Asia Pacific, such as ready-
to-drink tea. Ice cream is also helping to drive the guar gum market in Asia Pacific, which saw a CAGR of 7.3% between2003 and 2008, and is forecast to continue good growth, with a CAGR of 6.2% to 2013. Canned meat products are alsogrowing in popularity in Asia Pacific, as a convenient way to consume meat. This market saw a growth rate of 4.8%between 2003 and 2008, and is forecast to continue at around this rate to 2013.
Similar trends in Latin America and Eastern Europe are driving the market for guar gum in these regions. Eastern Europeis also seeing strong growth in wet pet foods, where sales saw a CAGR of 11.8% between 2003 and 2008.
Unlike other hydrocolloids, the market for guar gum is relatively small in Western Europe and North America. This is due toother hydrocolloids, such as xanthan gum, being used as a replacement for guar gum, where supply issues could be a
concern. Another factor in the relatively small market in these regions is that the sectors that it is used in are not aspopular as they once were, such as wet pet food, powder products and canned meat products. The small amount ofgrowth that guar gum is achieving is due to growth in the ice cream sector, and also in carbonates and yoghurts. However,even in these sectors, growth has slowed, and in the US the carbonates sector is in decline, giving an unfavourableoutlook for guar gum in these regions.
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Galactomannans Asia Big and Positive
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Guar Gum Market by Region and by Volume, 2008
Asia PacificEastern EuropeMiddle East and AfricaWestern Europe
AustralasiaLatin AmericaNorth America
Note: Dashed line indicates CAGR % for world marketSize of bubble represents market size by volume
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Its main market is ice cream, which continues to be in growth in all regions. The traditionally large markets of NorthAmerica and Western Europe have seen consumption slow as this market becomes saturated. However, Asia Pacific isnow the biggest market by volume for ice cream, having seen a CAGR of 7.3% between 2003 and 2008. Growth isforecast to continue at 6.2% to 2013 and, combined with the growth in the developing regions of Latin America and MEA,the locust bean gum market will remain in growth for the foreseeable future.
The slowdown in growth over the next 5 years is due to a downturn in demand for wet pet foods, as consumers turn to dry
pet foods for convenience.
Locust bean gum is sourced from theseeds of the carob tree, found mainly inMediterranean countries. It is sometimes
referred to as carob gum or carobin, andis an off-white powder formed from theendosperm of the seeds. Like Guargum, it is often used with xanthan gumor carrageenan. On its own it is athickener, but when combined with theseother hydrocolloids it forms a strong gel.Locust bean gum is said to be high insoluble dietary fibre and it is thereforebeing more widely used as a functionalingredient in prebiotic products.
Locust bean gum has continued to seegrowth over the review period. Volumesreached 16,061 tonnes in 2008 and areforecast to reach 18,560 tonnes by2013. The rate of growth picked upbetween 2005-06 as the consumption of
pre/probiotic yoghurts increased in manyregions.
y g y y
Galactomannans - Locust Bean Gum
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Volume(tonnes)
Volume of Locust Bean Gum, 2003-13
Leading Categories for Locust Bean Gum Usage, 2008% Share Vol (tonnes)
Ice cream 55.6 8,930Pet food and pet care products 23.4 3,758
Pro/Pre Biotic spoonable yoghurt 13.6 2,184Sauces, dressings and condiments 2.7 434
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Western Europe and Asia Pacific are the two largest markets for locust bean gum, reaching 4,717 tonnes and4,888 tonnes, respectively. These two markets are undergoing different trends though, as many of the end-use markets for locust bean gum are slowing in Western Europe and growing in Asia Pacific. Ice cream, in
particular, is shaping this market, having seen a CAGR between 2003 and 2008 of only 0.7% in WesternEurope and 7.2% in Asia.
Although only a relatively small market, Latin America has seen the strongest growth in consumption of locustbean gum. The annual growth rate was 15.6% between 2003 and 2008. This was driven not only by growth inice cream consumption, but also an increase in demand for functional yoghurts, which took off in this region inthe latter half of the review period. However, for there to be larger volume sales in this region, demand for icecream will need to increase further.
Galactomannans Ice Cream Holds Sway
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Locust Bean Gum Market by Region and by Volume, 2008
Asia Pacific
Eastern Europe
Middle East and Africa
Western Europe
Latin America
North America
Australasia
Note: Dashed line indicates CAGR % for world marketSize of bubble represents market size by volume
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There are a number of different cellulose derivatesused as hydrocolloids. The main one iscarboxymethyl cellulose (CMC), or cellulose gum,which is used in a wide range of food productsand household products. Another importantcellulose derivative is microcrystalline cellulose(MCC) or cellulose gel. Other cellulose ingredientsinclude quaternised hydroxyethyl cellulose (HEC)
and other cellulose ethers, which are used in non-food products.
Food and drink products account for only 28% ofthe celluloses uses, but they can be used in a
wide range of products, from fruit drinks to icecream. CMC is added to food products for texture,as a protein stabiliser, to retain moisture and toform oil-resistant films. MCC is used to givefreeze/thaw stability in frozen desserts, as a fatreplacement and to add texture. For this reason,one of its primary end uses is in ice cream.
Cosmetics and toiletries and household care eachaccount for over one third of the celluloses use, in
particular they are used in hair care, toothpaste,laundry detergents and fabric softeners.
The total market for celluloses as defined in thisreport was 67,598 tonnes in 2008, and the market
saw a CAGR of 4.1% between 2003 and 2008.
Celluloses Widely Used Hydrocolloids
Cellulose has a variety of functions, making it a widely used hydrocolloid. It can thicken, stabilise, bind water, emulsify, andform films, giving it the ability to be used in both food and non-food products. Cellulose is derived from the cell wall ofplants. On an industrial scale it is primarily derived from wood pulp and cotton for use in a wide variety of products.
Packaged
Food &Beverages
27.6%Household
care35.1%
Toiletries &Cosmetics
37.1%
Other0.2%
% Volume Share of Cellulose Derivativesby End Use, 2008
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Volume of Cellulose Derivatives, 2003-13
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CMC accounts for around three quarters of the volume ofcelluloses used as hydrocolloids. Volumes reached justunder 50,000 tonnes in 2008, having seen a CAGR of
4.1% between 2003 and 2008. The market is forecast toincrease at much the same rate to 2013. The CMCmarket continues to grow due to its diversity as ahydrocolloid. It is used in food and drinks, householdproducts and toiletries.
One of its main uses is in fruit-based soft drinks, such asjuice drinks (those that contain up to 24% fruit juice),where it helps to keep the particles suspended in the
liquid. Fruit-based soft drinks are growing as healthieralternatives to other soft drinks, such as carbonates. Juicedrinks (excluding Asian juice drinks) saw a CAGR of 7.6%between 2003 and 2008, and are forecast to see stronggrowth to 2013.
Within toiletries, CMC is used in toothpaste as a thickenerand to suspend the abrasives in the product. Toothpasteconsumption has continued to grow, driven by increaseddemand due to rising incomes in the developing regionsof Asia Pacific, Latin America and MEA.
Similarly, growth in demand for laundry detergents indeveloping regions is helping to keep the CMC market ingrowth. In regions such as China, where incomes havebeen increasing, the use of washing machines (and, inturn, laundry powder), there has been an increase inlaundry detergent sales. CMC is used in laundry productsas an anti-redeposition agent, attracting any dirt particles
being redeposited back on the cloth.
Celluloses CMC Dominates the Market
CMC73%
Celluloseethers17%
MCC6%
% Volume Share of CelluloseDerivatives, 2008
QuarternisedHEC4%
Leading Categories for CMC, 2008
%
Share
Vol
(tonnes)Soft drinks 28.5 14,155
Toothpaste 24.2 12,019
Powder detergents 20.3 10,082
Hand wash detergents 18.5 9,188
Meal replacement slimming products 0.7 348
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Asia Pacific accounts for over half of the CMC market, reaching a volume of 27,596 tonnes in 2008. Alongwith the other developing regions of Eastern Europe, Latin America and MEA, Asia Pacific has been drivingthe growth of this market. Asia Pacific is also forecast to see continued growth to 2013, with a CAGR of 5.3%.
Eastern Europe and Latin America are forecast to see growth rates fall from the rates they saw in the first halfof the review period, as demand for some of the key end-use products slows. In Asia Pacific, however,demand for juice drinks and toothpaste do not appear to be abating, with juice drinks forecast to see a CAGRof 12.0% by volume to 2013, and toothpaste 3.0% in the region.
The market for CMC remains relatively small in the Western regions, with Western Europe and North Americatogether accounting for only one fifth of this market. Within these regions, the markets for the key applicationsare now saturated, and any growth is coming in value rather than volume. Products like juice drinks have seen
a decline in North America in recent years, as consumers switch to other soft drinks, such as bottled waterand functional drinks, concerned about the potential high sugar content in some of these fruit-based drinks.
Celluloses Developing Regions Driving Growth of CMC
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CMC Market by Region and by Volume, 2008
Asia Pacific
Eastern EuropeMiddle East and Africa
Western Europe
Australasia
Latin America
North America
Note: Dashed line indicates CAGR % for world marketSize of bubble represents market size by volume
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Pectin has been used for many years for jam and jelly making, making it one of the more well-knownhydrocolloids used in food products. It has only been commercially produced since the early 20th century.
Although found in all plants as protopectin, it is primarily sourced from citrus peel and apple pomace, both of
which offer high-quality pectin in relatively large quantities.
There are two forms of pectin produced on a commercial scale, depending on the degree of esterification (DE)of the pectin molecules. Those with a high DE, of above 50, are known as high ester (HE) pectins, and thosebelow 50 are known as low ester (LE) pectins. HE pectins will form gels in aqueous products with a high solidcontent and low pH, such as traditional jams. LE pectins are able to form gels in products with a low solidcontent, a range of pHs, and in the presence of calcium.
The market for pectins increased over the review period, but growth reached a peak in 2004/05, at 9.1%.Since then, although the market has grown, the rate has slowed.
Pectin A Success Story
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Volume of Pectins, 2003-13
Volume (tonnes) % change y-o-y
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Pectin New Applications Boost Market
Strong demand between 2002 and 2005 was driven by drinking yoghurt (regular and pre/probiotic), which rosein popularity as a healthier alternative to other soft drinks, such as carbonates. Drinking yoghurts areparticularly popular in Asia Pacific but also in Latin America and MEA.
There was also strong growth in drinking yoghurts in North America in the first half of the review period.Growth for drinking yoghurts in all regions has since slowed, hence the slowdown in growth of pectins. Thedrinking yoghurt market is forecast to see a CAGR of 5.4% to 2013, with pectin forecast to see a CAGR of4.8% in the same period.
The traditional application for pectins, jams and preserves, now accounts for only 15% of total use, down from22% in 2002. The market for jams and preserves is still in growth, but at a slow rate of only 1.5% per annum.The traditional stronghold of Western Europe, in particular, has seen limited growth. This market is alsoforecast to see only limited growth of 1.8% to 2013, as consumers shun these high-sugar products for morehealthy alternatives, and as breakfast consumption habits change to more convenient products.
Leading Categories for Pectin Usage, 2008
% Share Vol (tonnes)
Drinking yoghurt 51.1 26,872
Spoonable Yoghurt 16.4 8,624Jams and preserves 15.3 8,046
Flavoured milk drinks with fruit juice 4.8 2,524
Chilled and shelf stable desserts 3.8 1,998
Ice cream 2.7 1,420
Fromage frais and quark 2.7 1,420
Pastilles, gums, jellies and chews 2.4 1,262
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The developing regions of Asia Pacific, Eastern Europe and Latin America continue to drive the pectin market,although all regions are seeing good growth to 2008 and beyond. The market for pectin is being fuelled in thedeveloping regions by dairy products, such as drinking yoghurts, spoonable yoghurts and flavoured milk
drinks, and ice cream.
Asia Pacific accounts for just under a third of the pectin market, and this share is set to increase as the pectinmarket increases in this region. During the review period, the pectin market in this region saw a CAGR of10.3% by volume and is forecast to continue to drive the market with a CAGR of 6.1% to 2013.
Western Europe, the second largest market after Asia Pacific, saw strong growth in pectins between 2003 and2008, with a CAGR of 5.0%. This growth rate is not forecast to be sustained, dropping to 2.4% between 2008and 2013, as the end-use markets mature in this region, in particular jams and preserves. Latin America and
Eastern Europe both saw strong growth rates between 2003 and 2008 10.5% and 8.1%, respectively but,similarly to Asia Pacific, this growth rate is not expected to be sustained in the near future, with consumptionof drinking yoghurts slowing.
Pectin Developing Regions Sustain Growth
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CAGR% 2003-08
Pectin Market by Region and by Volume, 2008
Asia Pacific
Eastern EuropeMiddle East and AfricaWestern Europe
AustralasiaLatin AmericaNorth America
Note: Dashed line indicates CAGR % for world marketSize of bubble represents market size by volume
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Carrageenan is produced from red seaweed and was first used in the Irish town of Carragheen to make agelatinous dessert from boiling milk with the seaweed. Although still harvested in Ireland, carrageenanseaweed is now farmed around the world on a commercial basis, in countries such as the Philippines and
Indonesia.
There are three types of carrageenan produced, depending on the variety of red seaweed used:
Kappa forms strong rigid gels on cooling in the presence of potassium or protein ions
Iota forms an elastic gel with the addition of calcium ions
Lambda does not form a gel but can be used to control viscosity
On a commercial basis these three carrageenans are often blended together.
Carrageenan is manufactured into refined and semi-refined (seaweed flour) carrageenan, depending on theproduction methods used. The method used to produce semi-refined carrageenan is a simpler and thereforecheaper way of producing carrageenan. However, because it is less refined it is not suitable for humanconsumption, and so it tends to be used in the pet food industry.
In the Philippines, the production method of semi-refined carrageenan was modified to make the productsuitable for human consumption. This product is referred to as Philippine Natural Grade (PNG) carrageenan. It
does not form a clear solution like refined carrageenan, so it can only be used in products where clarity is notan issue. The cost to end-use manufacturers is lower than standard carrageenan, so its supply has met strongopposition from producers of refined carrageenan. However, it is now approved for use in food and drinkproducts in both the US and Europe.
Carrageenans Production Methods for Different Demands
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The market for carrageenans was estimated at39,320 tonnes in 2008, of which refinedcarrageenan accounted for 56%. The market for
semi-refined carrageenan has been slowlydeclining as the market for wet pet foods hasdecreased. In particular, the market for wet petfoods is declining in Western Europe and North
America, as consumers switch to more convenientdry pet foods. However, growth is coming fromregions such as Eastern Europe, although the petfood market is still very small here.
Refined carrageenan is used in a variety ofproducts. It is used in a wide range of milk-basedproducts, including ice cream, drinking milk anddairy desserts, but only small amounts are requiredfor it to be functional. In ice cream it prevents wheyseparation, in chocolate drinking milk it keeps thecocoa in suspension, and in dairy desserts it
provides thickness. Other than dairy products, oneof its main uses is in toothpaste, where, like otherhydrocolloids, it acts as a thickener and suspendsthe abrasive particles in the product.
Due to its diversity, the market for refinedcarrageenan has continued to increase, with aCAGR of 3.9% between 2003 and 2008. Thisgrowth is forecast to slow a little to 2.9% to 2013,
driven by growth in most of its main markets.
Carrageenans Refined Tips Balance
-2%
-1%
0%
1%
2%
3%4%
5%
0
5,000
10,000
15,000
20,00025,000
30,000
%chgyoy
Volume(tonnes)
Volume of Carrageenan, 2003-13
Semi-refined RefinedSemi-refined Refined
Leading Categories for Refined CarrageenansUsage, 2008
%Share
Vol(tonnes)
Toothpaste 37.3 8,192Other sweet and savoury snacks (cup jellyproducts)
21.8 4,788
Ice cream 13.7 3,009Drinking milk products 11.2 2,460Dips 4.9 1,076Dairy-based desserts 2.5 549Soy Beverages 2.3 505
Air care 2.2 483
Canned/preserved meat and meat products 1.6 351
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Outside Asia Pacific, the marketsfor toothpaste, ice cream anddrinking milk products are shaping
the carrageenan market. WithinNorth America, all these marketssaw very little growth through thereview period, and forecastssuggest these markets will be flatto 2013. The other developingregions have seen growth in thesemarkets, but not to the sameextent as Asia Pacific. Forecastsindicate that these markets arenot going to fare as well to 2013,with limited growth outside of AsiaPacific.
Carrageenans Asia Pacific is Key
Asia Pacific is by far the largest market, with over half of the market for refined carrageenan, and is forecast tocontinue growing. Volume reached over 11,000 tonnes in 2008, and with a CAGR of 4.1% to 2013, the AsiaPacific market is forecast to see volume sales of around 14,600 tonnes. Within Asia Pacific, much of the
consumption of carrageenan comes from its use in jelly cup snack products, which are popular in Asiancountries. The market for these is growing at an annual rate of 5.7% by volume, contributing to the size andgrowth of the carrageenan market in this region. Its use in ice cream and flavoured milk drinks is also drivingthis market in Asia Pacific, with CAGRs of 7.3% and 15.2% between 2003 and 2008, respectively.
-1%
0%
1%
2%
3%
4%
5%
6%
-2% 0% 2% 4% 6% 8%
CA
GR%2008-13
CAGR% 2003-08
Refined Carrageenan Market by Region and byVolume, 2008
Asia Pacific
Eastern Europe
Middle East and Africa
Western Europe
Australasia
Latin AmericaNorth America
Note: Dashed line indicates CAGR % for world market
Size of bubble represents market size by volume
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Similarly to carrageenan, agar is a gelatinous substance produced from seaweed. It is produced from the redseaweed Gelidium and Gracilaria found around the coasts of many countries, including Spain, Portugal, Chile,
Argentina, Indonesia and Japan. It has been used for hundreds of years in desserts in Japan, but is now used
around the world as a thickener, stabiliser and gelling agent in many food products. It is also used inmicrobiological work as a substrate for culture development.
Although the market is still small, at 4,434 tonnes, it has been one of the strongest performing hydrocolloids,with a CAGR of 12.0% between 2003 and 2008.
It is used in a number of different products, including confectionery, yoghurts and soy-based desserts. It isoften used as a vegetarian substitute to gelatin and is used in hot countries, as it withstands highertemperatures than other hydrocolloids. It has seen particular growth in its use as a prebiotic ingredient inyoghurts, because agar is a good source of dietary fibre.
Agar Traditional Product Finding New Applications
0%
2%
4%
6%
8%
10%
12%
14%
16%
-
1,000
2,000
3,0004,000
5,000
6,000
7,000
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
%chg
yoy
Volume(
tonnes)
Volume of Agar, 2003-13
Volume (tonnes) % change y-o-y
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Functional yoghurts are seeing strong growth in Western regions, where consumers want products that areboth beneficial to them and taste good. The use of agar in functional low-fat yoghurts helps to give the productthe mouthfeel of a full-fat yoghurt and adds dietary fibre. This has been a particular driver of the agar market in
Latin America, which has seen strong growth in the consumption of agar, at a CAGR of 48.2% between 2003and 2008. The growth in this market is not going to be sustained at this same rate, but nonetheless the marketis forecast to grow by an annual average of 10.1% to 2013 in Latin America.
The two main markets for agar are Western Europe and North America, which each have around one-third ofthe market. This is due to the large market for yoghurts, in particular fruit yoghurts and the smaller, butgrowing, market of prebiotic yoghurts. The strong growth in agar in North America is being driven by anincrease in demand for functional yoghurts, which saw a CAGR of 40.1% between 2003 and 2008. This
market is more mature in Western Europe, but nonetheless it enjoyed a CAGR of 12.9% between 2003 and2008.
Agar Prebiotic Yoghurts Drive Market
0%
2%
4%
6%
8%
10%
12%
-10% 0% 10% 20% 30% 40% 50% 60%
CAGR%200
8-13
CAGR% 2003-08
Agar Market by Region and by Volume, 2008
Western Europe
Australasia
Latin AmericaNorth America
Eastern Europe
Middle East and Africa
Asia Pacific
Note: Dashed line indicates CAGR % for world marketSize of bubble represents market size by volume
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Other applications include saucesand syrups, where it acts as athickener; yoghurts, where itimproves the texture; fruitpreparations, such as those used inthe centre of breakfast bars; andrestructured meat and fish products,where it forms a gel and acts as abinder.
The market for alginates was
estimated at just over 3,100 tonnesin 2008, having seen a growth rateof 6.1%. The market is forecast tocontinue to grow at much the samerate over the forecast period, withvolume sales reaching just over4,100 tonnes in 2013.
Alginates Enjoying Steady Growth
Alginates, like carrageenan and agar, are also derived from seaweed in the form of calcium, magnesium andsodium salts of alginic acid. They can be produced from a number of brown seaweed types, including kelp andthe Laminaria species of seaweed found along cold water coastal areas. As with many hydrocolloids, they
have the ability to thicken, stabilise and form gels in a variety of products.
One of alginates main uses is in ice cream products, particularly impulse ice creams, where they act as a
stabiliser. Alginates reduce the formation of ice crystals during freezing, giving a smooth product, and help toreduce the rate at which the ice cream melts, making it useful for ice creams eaten on the move.
0%
1%
2%
3%
4%
5%
6%
7%
8%
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
%chgyoy
Vo
lume(tonnes)
Volume of Alginates, 2003-13
Volume (tonnes) % change y-o-y
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The main market for alginates is AsiaPacific, which accounted for over 60% of themarket in 2008. Growth has been strong in
this region, with a CAGR of 8.1% between2003 and 2008, and similar rates areforecast to 2013. The market for impulse icecreams is particularly strong in this region,having seen an annual growth rate of 7.2%to reach volumes of 4 bn litres in 2008. Thishas driven the alginates market in thisregion.
Latin America has seen the strongest growthin the market, with a CAGR of 9.3% between2003 and 2008. This has been driven tosome extent by an increase in theconsumption of impulse ice cream products,but the main driver of growth has been therise in consumption of breakfast bars. Theannual growth rate for breakfast bars in thisregion was 27.5%, due to key product
launches during the first half of the reviewperiod.
The once rapid growth in sales of breakfastbars appears to be abating. Although thismarket is still in growth, it is now starting tomature, particularly in the key region ofNorth America. During the review period itenjoyed a CAGR of 7.6%, but this is forecast
to drop to 1.7% between 2008 and 2013.
Alginates Impulse Ice Creams Key to Success
0%
1%2%3%4%5%6%7%8%9%
10%
0% 3% 6% 9% 12%
CAGR%2008-13
CAGR% 2003-08
Alginates Market by Region and by Volume, 2008
Asia Pacific
Western Europe
Australasia
Latin America
North America
Eastern Europe
Middle East andAfrica
-5%0%5%10%15%20%25%30%
0
20
40
60
80100
120
%CAGR
Volume(tonne
s)
Volume of Breakfast Bars by Region, 2003-13
Volume (tonnes) % CAGR 2032-08
Note: Dashed line indicates CAGR % for world marketSize of bubble represents market size by volume
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Research is being undertaken into using beta-glucan as a fat-replacer, as the trend for fatreduction in products continues. Recent researchhas seen it being used in high-fat products,including cookies and peanut butter. Most recently,research has been undertaken to look at usingbeta-glucan in chocolate. Beta-glucan has the
potential to replace some of the cocoa butter, butstill provide the same smoothness and texture. Thereduced-fat chocolate market is forecast to remainflat to 2013 with estimated sales of only 6,200tonnes in 2008. These products have not been verypopular as a reduction in fat often results in aninferior-tasting product. If beta-glucan replaced 10%of the cocoa-butter content in 10% of the chocolatetablets sold globally, then by 2013 this would
equate to an extra 4,300 tonnes of beta-glucan.
Beta-glucans Health Benefits Could Drive Market
Beta-glucans are found in the bran of cereal grains, predominantly barley and oats, but also rye and wheat, making them agood source of fibre. They are used in food products as a texturiser, most often as a fat replacer. It is thought that beta-glucans may offer some health benefits, including boosting the immune system, preventing coronary heart disease,
lowering cholesterol and reducing glycemic response, which is thought to be linked to its high viscosity. It could be arguedthat these health benefits are due to the consumer feeling satiated and therefore eating less when consuming theseproducts, rather than being directly due to the beta-glucans. They are widely available as a health supplements, whichusually carry the claim of being beneficial to the immune system.
Volumes of beta-glucan reached 17,342 tonnes in 2008, and are forecast to see a CAGR of 2.7% to 2013, taking themarket to just under 20,000 tonnes.
As a hydrocolloid, they are predominantly used in bakery products, particularly those products that offer health claims andhave high amounts of soluble fibre. In the US, the Food and Drug Administration has allowed a heart health claim to be
made on products that contain a minimum of 0.75 g of beta-glucan soluble fibre per serving.
3,864
4,150
4,354
3,600
3,700
3,800
3,900
4,000
4,100
4,200
4,300
4,400
2008 2011 2013
Volume(tonnes)
Potential Increase in Beta-glucan Volumes
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There are a number of other hydrocolloids that are used to a lesser extent.
Gellan gum
This is a relatively new hydrocolloid compared to others on the market, but is being used in a wide range ofproducts. It is manufactured through the fermentation of the Pseudomonas elodea microorganism and willform a gel at very low concentrations (0.1%). Some of its main uses are in air freshener gels, soy drinks (tosuspend particles) and snack foods (as an adhesive for seasonings).
Due to it being a relatively new hydrocolloid and the fact that it can be used in low concentrations, the marketis fairly small. It is estimated that volumes were around 404 tonnes in 2008, but the market is forecast to growto over 830 tonnes by 2013, making it one of the fastest growing hydrocolloids within this report.
Konjac
This hydrocolloid has been used in Asia for many years and forms part of some traditional dishes. However,its main use today is in the konjac jelly cup snack popular in Asia. Konjac has had some bad press over recentyears as konjac jelly cup products have caused a number of deaths from choking, and consequently theseproducts have now been banned in the EU. The snack needs to be chewed as the product does not melt inthe mouth like other gel-based foods and so can get lodged in the throat. Konjac can be used, as otherhydrocolloids are, in a variety of food products and like some hydrocolloids also has potential health benefits
from its high fibre content, making it a potentially important ingredient for new health products.The market for konjac is also fairly small, due to its current limited applications. Volumes were estimated to be1,196 tonnes in 2008 and are forecast to see a CAGR of 3.6% between 2008 and 2013.
Other Hydrocolloids
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Scope
Report Highlights
Hydrocolloids Category Analysis
Product Applications
Where Next?
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Both of these hydrocolloids have issues surrounding them. Gelatin, which is derived from animal sources(principally bovine and pig), can not be consumed by a proportion of the worlds population, due to either
religious or ethical concerns. This is limiting the use of gelatin, particularly in the growth markets of Asia andAfrica.
Gum arabic, which is sourced from a number of African countries, is seeing its supply continually under threat.Conflicts in regions like Sudan make it hard to guarantee supply, while changes in the climate are alsoaffecting production of the gum. In the past, devastation of the crop by locusts saw shortages in supply. Theseissues are all exacerbated by an increase in demand, as global consumption of products like confectioneryand soft drinks increases.
Confectionery accounts for around40% of the use of hydrocolloids in thecategories covered in this report.
Gelatin and gum arabic are the twoprincipal hydrocolloids used, but manyother hydrocolloids are used in bothchocolate and sugar confectionery.Gum arabic tends to be used only insugar confectionery, mainly inpastilles, gums, jellies and chews,
while gelatin is used in both chocolatebagged selflines and sugarconfectionery.
Confectionery Leading Category for Hydrocolloids
% Share of Ingredients in Pastilles, Gums, Jellies & Chews,2008
Ingredient % shareAcidulants 0.9
Colours 0.0
Flavours 0.2
Gum arabic 7.6
Modified starch 3.2
Pectins 0.1
Gelatin 3.5
Sugars and bulk sweeteners 71.0
Aqua/Water 10.3
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The main market for hydrocolloids inconfectionery is pastilles, gums, jellies andchews. This market is continuing to grow, with
a CAGR of 2.9% between 2003 and 2008,driven by increased demand in Asia Pacific.The largest markets of Western Europe andNorth America had been in growth up to 2007.Products in this sector are primarily targeted atchildren, and concerns over childhood obesitythrough consumption of high sugar and high
fat products is starting to have an effect on thismarket in these regions. Indeed, the market inNorth America is forecast to stagnate to 2013.
Key countries for future growth are in thedeveloping regions. China is set to continue tobe a strong market for this sector of sugarconfectionery, with a growth rate of 14.2%forecast to 2013. This is being fuelled by agrowing population and increases indisposable incomes. However, as theeconomic situation worsens in some of thesecountries, impulse products, such asconfectionery, will be among the first to beaffected. However, population growth will helpto stem any slowdown in growth as a result of
the economic downturn.
Confectionery Concerns Over Obesity Affect Demand
0%
2%
4%
6%
8%
10%
12%
0
100
200
300
400
500
600
%CAGR
Volume('000tonne
s)
Volume Consumption of Pastilles, Gums,Jellies and Chews by Region, 2008
Volume ('000 tonnes) % CAGR 2003-08% CAGR 2008-13
Top 10 Countries for Absolute Volume Growth ofPastilles Sector, 2008-13
2008Vol ('000 tonnes)
% CAGR2008-132
Absolute growth('000 tonnes)
China 166.4 14.2 156.1Vietnam 19.1 12.5 15.3Mexico 49.9 3.8 10.2Japan 55.6 3.1 9.1Indonesia 21.2 4.5 5.2
Austria 15.1 4.4 3.7Spain 34.9 2 3.7Poland 9.4 5.9 3.1USA 414.2 0.1 2.9
Ireland 6.2 7.3 2.6
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Although there is less use of hydrocolloids in thechocolate confectionery market, it is still an important onefor ingredient suppliers. In particular, gelatin is used in
the chocolate selflines/softlines sector.This sector of the confectionery market is also in growthand is forecast to continue growing for the foreseeablefuture. The sector saw a CAGR of 3.6% between 2003and 2008, but is set to see the rate fall to 2.4% to 2013.These products are very popular in Eastern Europe,which is the second largest market behind North
America. The market in Eastern Europe is also seeingsome of the highest growth in this sector. In particular,Russia and the Ukraine are forecast to see some of thelargest increases in consumption. Chocolateconfectionery is not as popular as sugar confectioneryproducts in Asia Pacific, as with many hot climates.However, India is forecast to see good growth, along withChina, where increases in disposable incomes areallowing consumers to purchase more indulgent impulseproducts.
The MEA region is a very small market but is forecast tosee some of the strongest growth in this sector ofconfectionery. Saudi Arabia, Morocco and Egypt have allseen consumption increase faster than the globalaverage, but together they had sales of only 4,100tonnes in 2008. Growth is being driven by consumerswho see chocolate as an everyday snack item, and bythe launch of more multinational brands that offer a better
quality of product than had previously been available.
Confectionery Growth in Developing Regions
-2%
0%
2%
4%
6%
8%
10%
0
100
200
300
400
500
600
%CAGR
Volume('000tonnes)
Volume Consumption of ChocolateSelflines/softlines by Region, 2008
Volume ('000 tonnes) % CAGR 2003-08% CAGR 2008-13
Top 10 Countries for Absolute Volume Growth ofChocolate Selflines Sector, 2008-13
2008Vol ('000 tonnes)
% CAGR2008-13
Absolute growth('000 tonnes)
Russia 302.7 6 101.8Ukraine 59.4 4.7 15.3China 19.3 6.1 6.7UK 56.7 1.7 4.9
Argentina 3.9 15.9 4.3France 21.8 3.1 3.6India 3.2 15.4 3.4Italy 7.7 5.7 2.5Indonesia 5.5 7.2 2.3
South Korea 11.8 3 1.9
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In North America and Western Europe,drinking milk in the form of milkshakes arepopular alternatives to other soft drinks