Frost & Sullivan’s Shanahan on Global Protein Ingredients

The following is an excerpt from the Arla Foods Ingredients-sponsored “2013 Protein Trends & Technologies Seminar Report.” A Global Food Forums, Inc. event, this in-person program provided compelling information for developers of protein-foods, beverages and nutritional products. Click here for a copy of the report.Soy proteins dominate plant protein market, as shown in this chart of global plant protein ingredient share.

Protein Ingredients, a Global Market
The protein ingredient market is highly competitive and fragmented. There are many sources of proteins that compete for a limited number of end applications. “This makes the importance of quickly identifying and addressing opportunities and threats critical,” explained Christopher Shanahan, Global Program Manager, Food Ingredients & Feed for Frost and Sullivan, in his presentation “Overview of the Global Protein Ingredients Market.”

A large variety of protein ingredients exist from both animal and plant sources. Dairy, egg and gelatin comprise the animal sources, with a wide range of dairy types that include milk protein concentrates (MPC); whey protein concentrates (WPC) and isolates (WPI); whey protein hydrolysates (WPH); and caseins and caseinates. Plant proteins include those from soy, wheat, peas, rice, potato and canola. Soy proteins are available as soy protein isolates, concentrates and textured soy protein.

Shanahan relayed that the global market volume demand for proteins was 2.3 million metric tons in 2012 and predicted revenue CAGR to be 5.5-6.0% for the years 2012-2018. In 2012, the largest ingredient share of the global animal protein market was held by egg proteins at 40%, followed by casein and caseinates at 13%, with gelatin and WPC35 (i.e., 35% protein) each at 11%. MPC had a 10% share, with WPC80, WPI and WPI at 7, 5 and 3%, respectively, according to Frost & Sullivan analysis. Soy proteins dominate the plant protein market.

Protein fortification in food and beverages is a key imperative to meet global challenges in nutritional deficiencies, noted Shanahan. Animal proteins typically provide complete protein, but soy is one of the few plant sources that also provides a complete protein. There has been a notable shift toward plant-derived proteins that offer similar or superior functional properties. Sensory properties are key to successful penetration of plant protein ingredients into applications dominated by animal proteins, as well as for development of new applications.

Shanahan explained, “The soy industry has enjoyed success by proactively positioning itself as a sustainable food/protein source; however, low consumer awareness of non-soy proteins has restrained growth of other key plant proteins.” Interestingly, cost-competitiveness is a low-impact driver, despite the cost difference between plant and other proteins being significant (between 30-50%). Health and wellness trends are the primary engines of growth in the protein ingredients market. “Among functional ingredients, proteins score very high in terms of future potential, due to their unequivocal health benefits and greater consumer recall of this benefit,” he added.

Weight management is a fast-growing segment. Positioning as a satiety ingredient is a key advantage for protein ingredients, especially since proteins are perceived as natural. Gluten-free or soy-free claims are possible with animal protein ingredients. On the other hand, environmental impact of animal proteins, primarily dairy, has been the subject of debate. Regulations around sourcing, processing, packaging and labeling are currently being tightened. “This is advantageous for animal proteins, which have had ample time to stabilize their positions regarding regulations,” offered Shanahan.

Pointing out that he was “protein impartial,” Shanahan noted that all proteins tend to have competitive advantages in one area or another. Dairy proteins enjoy the best nutritional and flavor profile, and they remain dominant in specific end-use applications, such as sports nutrition. Egg and gelatin are difficult to replace in bakery and confectionery applications. Plant proteins enjoy lower carbon footprints and higher sustainability, as well as low price and desirable nutritional profiles. Plant proteins score lower on sensory properties, and genetic modification is an issue for greater acceptance in Europe, he said.

Increased potential exists for dairy and plant protein blends; condition-specific nutrition; and improving protein delivery through further research and development.
One ongoing challenge is that a significant structural shift in price growth has occurred in the last 10 years. “Rising raw material costs, and the associated difficulties with transferring the increase to customers, will likely affect profit margins during the next decade,” he said.

“All of this information is interesting, but how can it be utilized to a company’s advantage?” Shanahan asked rhetorically. By filtering opportunities and threats, mega-trends and specific opportunities can be identified. Through detailed analysis of specific opportunities, actionable data and outcomes in each market can be recognized, he advised. Protein opportunities can be assessed through a systematic-growth consulting approach. Changing economics; concerns with food safety, health and wellness; and “going green” are addressed, and opportunities are optimized with this Growth Model.

The core objective is to identify a company’s “Growth Zone,” or those opportunities which have been optimized and validated based on strategic objectives and capabilities, taking the opportunities in the marketplace into consideration.

Christopher Shanahan, Global Program Manager, Food Ingredients & Feed for Frost & Sullivan, may be contacted at Christopher.shanahan@frost.com or +1.210.477.8419. A link to download his presentation is at the website http://GlobalFoodForums.com/2013-Proteinseminar.

 

Posted on:September 16, 2013

One thought on “Frost & Sullivan’s Shanahan on Global Protein Ingredients

Leave a Reply

Your email address will not be published. Required fields are marked *


Recent Posts

Recent Comments

Archives

Recent Tags


Copyright© Global Food Forums®, Inc 2018 / all rights reserved