The escalating food waste crisis in the Asia-Pacific region presents a significant challenge that demands urgent attention from stakeholders across the supply chain. To combat this, foodservice operators are increasingly adopting recycling as a cornerstone of sustainable practices. Sustainability initiatives in the food and beverage industry include ethical sourcing, food waste reduction, and implementing composting programs and efficient waste management systems, reveals GlobalData, a leading data and analytics company.
Shravani Mali, Consumer Analyst at GlobalData, comments: “As awareness around sustainability grows, consumers increasingly prioritise ethical considerations in their purchasing decisions. Consumer demand for sustainability efforts among food service establishments and the food and beverage industry is accelerating, pushing restaurants to use more recycled materials, reduce waste and decrease their carbon footprint.
Governments across Asia have launched various initiatives to act against the crisis. These efforts reflect a growing recognition of the environmental, economic, and social implications of food waste, which is a persistent challenge across the region.
For instance, according to the Department of Climate Change, Energy, the Environment and Water in Australia, food waste is a persistent issue in the country, with an estimated 7.6 million tons of food discarded each year. Under the National Food Waste Strategy, the Australian government aims to halve the country’s food waste by 2030. Approximately 4 % of Australian food waste comes from the hospitality and foodservice sector1.
Moreover, in the Chinese municipal waste structure, approximately 50 % accounts for food waste2. As a sign of hospitality in the Chinese culture, people tend to order more food than they can eat. Prompted by these concerns, the Chinese government issued the Anti-Food Waste Law (AFWL), which aims to alleviate food waste.
Tim Hill, Key Account Director, SE Asia at GlobalData adds: “As a result of rapid urbanisation, population growth, and a complex food supply chain in APAC, there is a rising need to implement strategies to reduce food waste, thereby enhancing sustainability.”
For instance, food waste that is unsuitable for human or animal consumption such as fruit/vegetable peels and eggshells can be used to enrich the soil or as a natural fertiliser for landscapes.
Hill adds: “Additionally, redistributing excess food in collaboration with nonprofit organisations and food banks will foster a sense of responsibility towards food resources. Hence, such initiatives are expected to reflect a considerable decrease in the environmental footprint.”
Mali concludes: “The growing food waste problem in the APAC region demands immediate action and collaborative efforts across sectors to establish sustainable practices, enhance resource efficiency, and establish a resilient and responsible food system. Tackling this issue is crucial not only for environmental sustainability but also for bolstering the economic and social welfare of the APAC region.”
1CSIRO, November 2023
2Environmental Change and Security Program – Woodrow Wilson International Center for Scholars, December 2023
3GlobalData 2024 Q3 Consumer Survey – Asia & Australasia, with 6,000 respondents, published October 2024
Oterra, one of the world’s leading suppliers of natural colours with one of the widest portfolios in the industry is pleased to announce that the acquisition of India’s Akay Group is now complete. Oterra announced its intention to purchase Akay in July of 2022. Founded in 1995, Akay Group is a leading player in the natural colours and nutraceutical ingredients market.
This acquisition is the company’s fourth in under two years, and its first within the Asia Pacific region. Based in Kerala, India, Akay has four manufacturing sites in southern India that Oterra will add to its existing production network, as well as 400 employees who will join the team.
The acquisition further strengthens Oterra’s backwards integration, mainly in turmeric and paprika. It also provides a strong addition in the nutraceutical ingredients area and will allow the company to offer its customers and market partners a complimentary portfolio to its existing natural food colours solutions for dietary supplements.
The two companies have a long-standing connection. Oterra, previously known as Chr. Hansen Natural Colors, was in 1995, part of a joint venture with Akay to produce natural colours from turmeric and paprika. From 2007, Akay continued as an independent company, but Oterra and Akay kept close ties with each other since Akay was a key supplier to Oterra.
Teetotalism trends in the Asia-Pacific region are becoming increasingly prevalent, with approximately *3three out of four (71 %) of consumers drinking less alcohol in August 2020, according to a survey by leading data and analytics company GlobalData. However, the adoption of alternative soft drinks remains low, at only one in five* consumers. In fact, APAC customers surveyed are more attracted by health claims – specifically products noted to help support mental wellbeing – with such products purchased by nearly a third of consumers. Going forward, it will be crucial for drinks brands to blur the lines around traditional alcoholic products and offer ‘better for you’ messaging.
Carmen Bryan, Consumer Analyst at GlobalData, comments: “APAC consumers are turning away from alcohol driven by concerns around physical and mental health. While general health concerns take precedence, backed by *almost half (49 %) of the region’s population, weight management, fitness, physical appearance and emotional wellbeing are all considerable factors driving low or no-alcohol innovations.”
Recognizing this trend, New Zealand-based companies Adashiko and Parker Beverages recently launched a collagen-infused bottled water, marketed as ‘premium’ and ‘sophisticated’. This launch leverages growing demand for alternatives to alcohol that incorporate functional properties, writes GlobalData.
Bryan adds: “By incorporating functional and beneficial ingredient formulations, companies such as Adashiko-Parker Beverages are able to align to personalized health trends and cater to an evolving consumer landscape.”
Looking at alcohol consumption trends more closely, GlobalData’s research reveals that, of the *271 % of consumers drinking less, a sizeable *20 % (one in five) have stopped drinking alcohol altogether. In contrast, when asked a similar question in the US.
Bryan adds: “As pubs and bars closed their doors this year, and tensions regarding public health heightened, consumers were forced to reassess their priorities and lifestyles. Trends are shaping new home-bound leisure and social occasions where consumers seek the same taste and feel of mature drinks without the negative implications.”
Japanese FMCG company, Morinaga, is leveraging these trends with its amazake product range. Most notably, the Morigana Collagen in Haenuki flavour puts a healthy twist on the traditional sweet and low-alcohol Japanese drink by highlighting the high collagen and alcohol-free claims.
Bryan adds: “GlobalData’s research highlights the importance of premium positioning and clear ‘better for you’ messaging. By leveraging wellbeing factors such as natural, immunity-boosting or skin health, brands can create a premium product that blurs consumers’ perceptions around traditional alcoholic products. A rebranding mission, of sorts. Going forward, it will be crucial for brands to blur these lines further, emphasizing the positive health credentials that will help reassure consumers, both mentally and physically, to tap into multiple consumption occasions and justify a potentially higher price mark up.”
*GlobalData’s 2020 market pulse survey – Asia-Pacific – published 1 September 2020
*2Combined responses: “I try to consume a moderate amount” and “I am trying to reduce my intake as much as possible”
*3Combined responses: “I try to consume a moderate amount”, “I am trying to reduce my intake as much as possible”, and “I avoid this entirely”
Premiumization has developed as an excellent way forward for the brands to make consumers feel valued and special in the Asia-Pacific (APAC) region as the consumers are preferring and consuming high value products, says GlobalData, a leading data and analytics company.
Across the FMCG sector, be it food, or beverages, the brands are releasing new premium products along with exclusive offerings that elevate them above the national mass brands and compete as recognized premium products.
With the socio-eco diversification, the purchasing behavior of consumer has totally altered in different countries of the same continent. For instance, 76 % of consumers in China typically relish the opportunity to consume the highest-quality food & drink, often justifying a higher price point.
Shagun Sachdeva, Consumer Insights Analyst at GlobalData, says: “Asia-Pacific region has huge potential for growth due to population growth, rapid urbanization and rising disposable incomes in its emerging economies. High on the list of consumer preferences are high quality products with a luxurious feel and the products that offer greater convenience. The consumers also prefer to have products that pass stringent safety standards and are produced with environmentally sustainable practices.
Adapting to the changing demands and values of today’s modern shoppers, brands have realized the need to upgrade to premium offerings. Manufacturers have their eyes set on the premium market and targeting the middle-to-high income segment through host of value-adds to lure people to upgrade.”
Coca-Cola has rolled out a new energy drink – Coca-Cola Energy – in Vietnam as part of the company’s larger focus to evolve into a complete beverage company and offer the Vietnamese consumers a wide range of drinks to cater the different lifestyles and occasions, says GlobalData, a leading data and analytics company.
According to GlobalData’s 2018 Q4 Consumer Survey, around 41 % of Asia-Pacific (APAC) consumers prefer to experiment with new kind of soft drinks and around 40 % of them are willing to pay more for better quality soft drinks.
Shagun Sachdeva, Consumer Insights Analyst at GlobalData, says: “Soft drinks brands have been coming across increased competition amidst intensifying scrutiny of sugar-sweetened beverages and corresponding consumer efforts to make healthier choices. Against this backdrop, they are mapping out the wellness considerations for the products they are offering to attract a niche market of specialists such as sports enthusiast and athletes, whilst also appealing to the mainstream of active lifestylers.”
An analysis of GlobalData’s Market Analyzer reveals that APAC energy drinks market is expected to grow at a compound annual growth rate (CAGR) of 7.9 % from US$24.7bn in 2018 to US$36.2m in 2023. The Vietnamese energy drinks market is expected to reach US$1.46bn by 2023 from US$1.34bn in 2019.
Sachdeva adds: “Energy drinks have become a key thrust for Coca-Cola to rejuvenate growth in the APAC soft drinks market. The company is quick to understand that soft drinks category needs an image makeover. As a result, it is breaking the long-standing lead in Carbonated Soft Drinks (CSDs) by expanding its range of drinks portfolio to tap the correct set of active and time-scarce consumers and embracing innovation to sustain a highly competitive marketing profile.”
The other factors contributing to the emerging growth of the Vietnam energy drinks’ market are improving economic climate, socio-political stability and likelihood of stringent regulations as the Ministry of Finance has proposed a new sugar tax of 10% on sugary drinks from 2019.
Sachdeva concludes: “The launch comes at a time when most of the beverage companies are going beyond soda and there is growing competition in the carbonated market following the influx of countless other carbonated brands. Even though, Coca-Cola is already offering energy drinks under the brand name Monster, the company’s decision to launch energy drinks under its trademark will reinforce local identity, foster reassurance, create emotional resonance among the consumers and further deepen brand’s equity in Vietnam.”
The beverage sector has undergone a significant transformation over the past decade in line with changing consumer preferences.
Sumit Chopra, Consumer Research Director at GlobalData, a leading data and analytics company, highlights six major innovation trends that are set to impact the production, marketing and sales of the beverage sector in Asia-Pacific (APAC) in 2019.
Unusual ingredients and featured flavors
GlobalData’s 2018 Q4 Consumer Survey found that 17 % of consumers in APAC often like to experiment with novel ingredients, creating opportunities for manufacturers. For instance, India-based urban lifestyle beverage brand Zago launched Iced Masala Chai, which offers a ‘refreshing’ twist to traditional ready to drink teas infused with traditional aromatic flavors such as cardamom and ginger.
Authentically indulged
According to GlobalData’s 2018 Q4 Consumer Survey, around 40 % of APAC consumers are willing to pay more for better quality beverages. Against this backdrop, beverage manufacturers are aiming to create an authentic brand image to foster consumer trust and loyalty. In Australia, Podpac is offering new coffee pods under the Baileys trademark in order to give coffee drinkers a premium indulgence that is marketed under an alcohol brand name.
Revitalized & balanced
GlobalData’s 2018 Q4 Consumer Survey highlights that 65 % of consumers in APAC are always or often influenced by how a product impacts their health and wellbeing while making their consumption choices. Against this backdrop, beverage companies are mapping out the wellness considerations for the products they are offering to attract a niche market of specialists such as sports enthusiast and athletes, whilst also appealing to the mainstream of active lifestylers. For example, Applelachia launched a sparkling apple cider drinks range that incorporates foreign ingredients like Yuzu, a citrus fruit used as a tonic by samurais to boost their immune system, in Australia.
Packaging formats
GlobalData’s research reveals that APAC consumers prefer small single-serve pack sizes and seek out new products packed in PET and small metal cans, reflecting the overall emerging trend in the region towards on-the-go consumption. For instance, Locally Merci Buco 100 % organic coconut water in a 330 ml tetra pack variant bagged a packaging excellence award for an innovative PET squeezable bottle in 2019 in the Philippines, as it catered to the strong association between energy drinks and on-the-go consumption.
Sugar war raging
Beverage companies need to be ready for the likelihood of stringent regulations, as the governments across the region are exercising more power, particularly around issues such as obesity and consumer welfare. Malaysia’s Ministry of Health is all set to impose a sugar tax on sugar-sweetened beverages from 1 July 2019. Against this backdrop, key beverage brands are reformulating their portfolios. For instance, Malaysia-based Fraser & Neave (F&N) Holdings Bhd is looking to reformulate 70 % of its products to mitigate the sugar tax impact.
Moderation & avoidance
Consumers are increasingly becoming health-conscious and proactively addressing their health issues by curbing alcohol indulgence. Manufacturers are therefore striving towards offering zero alcohol beverages with healthy ingredients. Heineken’s launch of new zero-alcohol beer Heineken 0.0 in Singapore fulfills the growing demand for non-alcoholic alternatives for evolving customers.
As the economic outlook for Asia-Pacific (APAC) remains strong and consumers in the region continue to put in a high level of performance, stress and overwork will be the important concerns related to mental health among them. Against this backdrop, beverage makers which offer fortified drinks with health-enhancing ingredients will have an edge over others in the region, says GlobalData, a leading data and analytics company.
According to the company’s Q1 2017 consumer survey, stress, overwork and memory loss are the major concerns for APAC consumers. Among the three, stress was the leading mental health concern with 84 %.
The company’s report, ‘Top Trends in Healthcare and OTC Products 2018’ reveals that the majority (61 %) of consumers in APAC are looking for drinks with health-enhancing ingredients but very few drinks feature them.
Will Grimwade, Consumer Analyst at GlobalData, says: “Health drinks have often been pigeon holed into being either low sugar variants or energy boosters fortified with caffeine, vitamins or minerals. Mental health is a growing concern, but fortified drinks rarely address this need.
“Sales of fortified drinks and demand for drinks with health enhancing ingredients in APAC are both currently at a medium level. There is little focus on mental health within this sector and the large size of the total soft drinks market makes this a good opportunity.”
GlobalData expects a growing number of new launches to the market that include ingredients such as Gingko Biloba, Turmeric and Lecithin. Companies such as Coca-Cola are investing in emerging ingredients such as Cannabidiol (CBD) oil in North America due to its pain and anxiety easing effects, with use of the ingredient likely to spread to Asia within the next few years. This shows that companies are looking to target a more diverse range of health needs.
Grimwade concludes: “Economic growth is unlikely to stagnate and stress levels for APAC consumers are unlikely to drop, meaning the appeal of stress relieving drinks is likely to remain strong.”
