{"id":4293,"date":"2020-09-17T03:20:45","date_gmt":"2020-09-17T03:20:45","guid":{"rendered":"http:\/\/commodityconversations.com\/wordpress2\/?p=4293"},"modified":"2020-09-17T03:20:45","modified_gmt":"2020-09-17T03:20:45","slug":"commodity-conversations-weekly-press-summary-134","status":"publish","type":"post","link":"https:\/\/commodityconversations.com\/wordpress2\/2020\/09\/17\/commodity-conversations-weekly-press-summary-134\/","title":{"rendered":"Commodity Conversations Weekly Press Summary"},"content":{"rendered":"

One of the biggest challenges for food and beverage manufacturers in the post-Covid era will be to offer consumers products that combine health, indulgence and affordability. A <\/span>survey by ADM<\/span><\/a> noted that people had become increasingly concerned – as well as knowledgeable – about their health but that they were also facing a weaker purchasing power. Besides, the stress of losing jobs and the general uncertainty is pushing them to indulge in comforting snacks. ADM noted that, in that category, plant-based snacks were becoming increasingly popular but remained expensive.\u00a0<\/span><\/p>\n

The timing is perfect for Nestle, which, after selling several businesses over the past year and a half, said it was now <\/span>looking to make acquisitions<\/span><\/a> in line with the group\u2019s new image as a \u201cnutrition, health and wellness business.\u201d The company just announced a USD 30 million investment in <\/span>Closed Loop Partners<\/span><\/a>, a company looking at food-grade recycled plastics, as part of its commitment to lower its use of virgin plastic by 30% by 2025. In China, it is investing USD 59 million to help make <\/span>dairy production more sustainable<\/span><\/a> as well as develop organic grains. Beyond health and wellness, it remains open to \u201chigh growth\u201d categories, with an eye on the frozen food sector which has been growing steadily, a company official said. Another focus is to be able to reinvent their established big brands fast enough to meet the consumers\u2019 needs, he added.\u00a0<\/span><\/p>\n

Kraft Heinz<\/span><\/a>, too, is changing the way it is looking at products. The CEO explained that they were now looking at what people need instead of thinking in terms of a range of products. The group has scrapped 1,100 products from its portfolio, the equivalent of 20% of its business, to lower its cost of procurement and avoid \u201ccannibalising sales.\u201d The plan is to use fewer ingredients, to lower the sugar content and work closely with suppliers to save USD 1.2 billion in its procurement division over the next 5 years as part of a major turnaround plan.\u00a0<\/span><\/p>\n

Another group trying to speed up the pace at which it can meet consumers\u2019 needs is <\/span>Pepsi<\/span><\/a> which just launched Driftwell, a sugar-free drink made with stress reducers L-theanine and magnesium to promote relaxation. The company said this was the \u201cfastest new product to ever come out of the company\u201d and is banking on the recent focus on good sleep and relaxation.\u00a0<\/span><\/p>\n

Cargill<\/span><\/a> is building a 50,000mt plant in China to produce a sugar substitute called trehalose. The plant, Asia\u2019s biggest, will produce more than enough to meet China\u2019s demand of 30,000mt for the sweetener. Although China produces almost three-quarters of the world\u2019s sugar substitutes, consumption in the country has lagged because of permissions related to patent issues. But with demand for sugar-free drinks exploding, such as Yuan Qi Sen Lin which beat its full 2018 revenue in the first five months of 2020, demand for sugar substitutes is growing just as fast. And with a sweetener market share of only 10%, it still has a long way to go.\u00a0<\/span><\/p>\n

But while new generation sweeteners such as erythritol and sucralose are perceived to be much better than the older ones such as Aspartame, they are still about <\/span>80 times more expensive<\/span><\/a> to produce. Regardless, Cargill said it is a trend that is here to stay and food and beverage makers will need more and more solutions. In <\/span>Hong Kong<\/span><\/a>, however, the Consumer Council warned that many of the sweeteners used in diet drinks could potentially be harmful if consumed in large quantities. It noted that while drink companies in Hong Kong are only allowed to use some 10 sweeteners, there is no limit on the quantity.<\/span><\/p>\n

Olam<\/span><\/a> announced the launch of a new business arm, Olam Cocoa for Professionals, under which it supplies its premium deZaan cocoa powders to restaurants and bakeries in smaller bags instead of the traditional packing in tonnes destined for large manufacturers. Olam Cocoa has also been working on <\/span>plant-based creamers<\/span><\/a> that can be used in snacks and ice-cream, something that has been a challenge, a company official said. The market is growing – a survey commissioned by Olam in the UK found that more people were turning to plant-based snacks since the start of the coronavirus lockdown, in part because of health concerns.\u00a0<\/span><\/p>\n

In the US, a multi stakeholder meeting is happening to figure out ways to incentivise farmers to switch to more environmentally friendly practices. Known as <\/span>Honor the Harvest<\/span><\/a>, the aim is to \u201ccreate value chain financing where the customers or corporations partner with farmers to coinvest in climate-friendly practices,\u201d the founder said. He explained that while farmers don\u2019t like to be told what to do, it makes financial sense to get involved as the world\u2019s major food producers, including Nestle, Danone, McDonald\u2019s and more have plans to achieve net zero carbon at some point in the next decades.<\/span><\/p>\n

After much negative press this summer, <\/span>Tyson Foods<\/span><\/a> announced it had tied up with certification provider Where Food Comes From to verify sustainable beef production practices on more than 5 million acres of cattle grazing land – the biggest initiative of its kind in the US.\u00a0<\/span><\/p>\n

This summary was produced by<\/span> ECRUU<\/span><\/a><\/p>\n

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