Health ingredients report 2021

Health Ingredients report 2021

Health Ingredients in the Spotlight 14-18 June 2021

Learn more about Fi Global CONNECT Health Ingredients in the Spotlight

Contents Opportunities and hurdles for health ingredients . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Macro trends in health ingredients . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4

Immune health . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Holistic health . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Adaptogens and nootropics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 L-theanine . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Mushrooms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Hops . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Cannabidiols . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Gut health . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Performance & active nutrition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Sports nutrition goes natural . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Sports nutrition goes plant-based . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Sports nutrition goes holistic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Healthy ageing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Personalised nutrition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

11

Industry focus points . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Spotlight on an industry challenge: Feel or fail? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Making ingredients approachable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 How to deliver functional benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Future trendspotting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Immunity innovation: Fermented botanicals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Green and clean: Upcycled ingredients . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Eying up an opportunity: Vision health . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Key takeaways . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

2

| L earn more about Fi Global CONNECT: Health Ingredients in the Spotlight

Opportunities and hurdles for health ingredients Taking care of health has long been a priority for most individuals and a balanced diet is seen as a cornerstone of general health.

The COVID-19 pandemic has accelerated many trends that were already shaping the food and drink industry; that diet-related diseases such as obesity and type 2 diabetes are established co-morbidities for COVID-19 has brought the link between food and health into sharp focus.1 Demand for healthy foods, functional ingredients and supplements has risen as a result.2 With second and third waves leading to further national lockdowns and vaccines initially being offered only to the most vulnerable population segments, brands can be confident that consumers will continue to place an emphasis on health and nutrition support going forward.

Manufacturers wishing to incorporate functional health ingredients to their product portfolios must nevertheless be mindful of the current economic downturn. While premiumisation has been a driving force in the functional food category in recent years3, many consumers are feeling the brunt of a global recession and are adapting their purchasing habits as a result, switching to private label and seeking out bargains. Brands must therefore ‘prove their value’.

Even so, consumers may be unwilling to switch certain products, such as infant formula or specialised nutrition products, and manufacturers operating within these categories can expect to maintain sales.4 These brands should highlight the added value benefits of their products, such as nutrient density, organic sourcing, or natural ingredients.

Health ingredients report 2021 | 3

Macro trends in health ingredients Immune health There has been a 17% rise in number of people around the world making changes to their diet and lifestyle specifically to improve immunity levels in past year, according to a 2020 FMCG Gurus survey. Michael Hughes, Head of research & insight, FMCG Gurus points out that;

“Concerns about serious health complications arising from COVID-19 are not just associated with consumers from more vulnerable demographics, such as senior citizens or people with underlying health conditions. Instead, across the globe, many consumers are re-evaluating their health and wellness, questioning their vulnerability to disease and illness, and questioning their lifestyles, looking to make fundamental changes in order to minimize the risk of illness.” 5 Europe is the most lucrative market for immunity-enhancing products and leads the way for product launches. 41% of global new food, drink, and healthcare products making an immunity claim in past five years were launched in Europe, followed by 34% in Asia, 10% in North America, and 9% in Latin America, according to Mintel.6 Research shows that the body’s ability to fight infection – and even the efficacy of its response to vaccines7 - is impaired if the individual is stressed or sleep deprived8, and the link between immunity, sleep, and stress is becoming ever more established in consumers’ minds.

Manufacturers are beginning to develop immune health products that cater to holistic health concerns.

However, in past five years, only 5% of global immune supplements made a functional claim relating to sleep or stress management, according to Mintel data, indicating a significant white space for brands.9 US brand Airborne adds L-theanine for immunity and relaxation to its Good Rest berry-flavoured gummies while Zarbee’s makes citrus-flavoured drink powder with elderberry and vitamin C to promote immunity and melatonin for peaceful sleep. US brand Koios makes stevia-sweetened drinks that blend nootropics – lion’s mane, panax ginseng root, L-theanine, and coconut MCT oil – for an all-round ‘brain, energy and immunity boost’.

Brands must always be mindful of the health claims they can legally make in each market. In Europe, for instance, manufacturers can make 12 immunerelated health claims for 10 nutrients: vitamin A, B6, B12, C, and D, and the minerals folate, copper, iron, selenium, and zinc.10

4

| L earn more about Fi Global CONNECT: Health Ingredients in the Spotlight

Manufacturers must also be wary of explicitly linking their product to boosted immune health in the context of COVID-19 or risk falling foul of regulators.11 Although EU manufacturers can legally claim the above nutrients contribute to the normal functioning of the immune system if used in certain minimum amounts, there are no authorised EU health claims for a food or supplement that protects against viral infection or boosts immunity against a virus.

Looking ahead, elderberry extract and olive leaf extract could be two immunity-enhancing ingredients to watch. Both are currently mainly being used in dietary supplements but will increasingly move over into the food and drink space, predicts Reading Scientific Services Ltd (RSSL).12

Holistic health Taking a holistic approach to health and wellbeing is not a new concept. Around 2,000 years ago, the dictum ‘a healthy mind in a healthy body’ formed the basis of the Hippocratic philosophy13 while, in 1948, the World Health Organization defined health as “a state of complete physical, mental and social wellbeing, and not merely the absence of disease and infirmity” in the opening article of its constitution.14 However, holistic health is possibly one of the most defining macro-trends of the current decade,15 accelerated by 2020’s global public health crisis. The inhibitive nature of national lockdowns and social distancing measures have taken a toll on many individuals’ emotional wellbeing, placing holistic health at the forefront of their minds.

In the UK, 65% of consumers say mental and emotional wellbeing is just as important to them as diet and physical exercise, with only 8% seeing it as less important,16 and this tendency can be seen around the globe. FMCG Gurus found that almost as many global consumers plan to improve their general health and wellness (60%) throughout 2021 as those who want to improve specific health outcomes, such as heart health (65%) and immunity (64%).

This presents opportunities for functional food and drink manufacturers to develop products that support emotional as well as physical health.

Natural herbs and botanicals that have traditionally been used for their holistic benefits are being offered in new formats, bringing consumers convenience and new consumption occasions. Chamomile, for instance, is no longer simply a bed-time herbal tea.

Australian brand Almo Milk makes almond milk with 'nourishing and calming' chamomile blossom extract and CocoJune making coconut yoghurt flavoured with vanilla and 'soothing' chamomile.

Holistic health is also manifesting itself through the rise in beauty ingestibles. Cosmetic and personal care products are moving away from seeking to improve or change individuals’ appearance towards enhancing internal and external well-being.17 The number of edible products and supplements making beauty claims thanks to their use of collagen – particularly hydrolysed collagen and collagen peptides – has risen significantly in the last five years, according to Mintel, as consumers look for foods that improve skin health and appearance from the inside out.18 New York brand Kalumi makes protein bars with marine-based collagen to promote hair, skin and nail health while Beauty Food makes cookies and nut butters with collagen.

Health ingredients report 2021 | 5

Adaptogens and nootropics The trend for holistic health is also driving interest in adaptogens and nootropics, ingredients that are said to naturally boost mental focus and emotional wellbeing.

Once niche buzzwords of the wellness world, these ingredients are slowly becoming mainstream concepts, particularly among younger consumers. Adaptogens claim to be botanical substances that support the body by restoring balance and helping people cope with physical and mental stress, while nootropics are said to improve cognitive function such as memory, alertness, and focus.

Although neither term has a legal definition, analysts predict adaptogenic and nootropic ingredients will gain traction in coming years, particularly as they are embraced by major CPG companies.19 So, which are some of the most promising adaptogens and nootropics?

L-theanine L-theanine is a non-protein amino acid found in green tea leaves that is thought to impact serotonin, sleep hormones and other neurotransmitters, and big manufacturers have embraced the ingredient. In 2016, Coca-Cola launched L-theanine-enriched ‘Sleep Water’ under its Glaceau brand in Japan while in September 2020, PepsiCo launched Driftwell, a non-carbonated ‘enhanced water’ with 200 mg of L-theanine for sleep and relaxation, in the US. One recent study, which found L-theanine has the potential to promote mental health in the general population with stress and cognitive impairments, suggested a dosage of 200 mg a day.20

Mushrooms Popular adaptogenic mushrooms, many of which are staples of traditional Chinese and Ayurvedic medicine, include lion’s mane, chaga, reishi, turkey tail, cordyceps, and shiitake.

British start-up, Fungtn makes a range of low-alcohol (0.5%) craft beers brewed with a blend of adaptogenic mushrooms that allow people to enjoy the flavour of beer without the hangover.

Under the brand NeonMind, Canadian company Flourish Mushroom Labs blends coffee with extracts of functional mushrooms and other Ayurvedic botanicals, to offset coffee’s caffeine crash while US brand Deux adds a health halo to its indulgent cookie dough, Immunity x Pumpkin Spice, by adding chaga and cordyceps and other nutrients.

Adaptogenic mushrooms tend to have an earthy, umami-rich flavour profile that may require masking depending on the application and amount used, although some have naturally sweet notes that can be accentuated in ice cream, beverage, and bakery applications.21

6

| L earn more about Fi Global CONNECT: Health Ingredients in the Spotlight

Hops The bitter resins and essential oils in the flowers of the hop plant (Humulus lupulus) have been linked to sedative and relaxing effects.22 Although firmly associated with beer, hops could find their place in alcohol-free beverages as they allow the growing number of mindful drinkers to relax and unwind in social occasions.23 A survey by IWSR found that 95% of Spanish consumers are trying to reduce their alcohol intake while half of Australians have drunk or would consider drinking low- or no-alcohol products.24 Brazilian brewery Araucária launched H2OP, a calming hop-infused water while US company Hoplark sells a brewed blend of tea and hops in ‘relax packs’. Austrian company Snoooze, founded by a former Red Bull executive, is a sleep-aid drink with natural sedative ingredients such as lemon balm, valerian, and hops.

Cannabidiols The calming properties of CBD are well-established in consumers’ minds, making it an ingredient-to-watch.

Nielsen predicts that, by 2025, the legalised hemp-derived CBD food and beverage market could be a $6 billion-industry in the US.25 CBD is being embraced in many formats from gummy sweets to soft drinks and has even made its way into sports nutrition products. US brand Floyd’s of Leadville makes a recovery protein with 250 mg of CBD to reduce post-workout muscle soreness.

However, the ingredient faces regulatory hurdles in markets around the world.26 Manufacturers should actively communicate about the product’s safety and legality to reassure consumers, distinguishing it from the recreational (and often illegal) drug cannabis, which contains the psychoactive component THC. Some manufacturers are leveraging the relaxing associations of cannabis without making explicit claims of CBD content, thus avoiding any regulatory pitfalls. US beverage brand Recess, for instance, positions its relaxing drink around the inclusion of hemp extract (among other ingredients) but does not specifically mention CBD.

insights.figlobal.com

Health ingredients report 2021 | 7

Gut health Around one-quarter of consumers globally suffer from lower digestive health issues27 and, in recent years, public interest in gut health and the microbiome has grown. The popularity of probiotic supplements and traditional fermented food and drink such as kimchi and kefir reflects this, but consumers are also searching for microbiome benefits in new and convenient formats.

The benefits of having healthy and well-balanced microbiota in the gut also go beyond digestive comfort with scientists now agreeing that a huge proportion of the immune system lies in the gastro-intestinal tract.28 The desire to boost immune health, triggered by COVID-19, has led to a spike in global probiotic sales, with the category experiencing around 8% growth at the end of summer 2020, reversing a trend towards downwards or flat growth.29 In the US, Nestlé recently launched GoodBe, a chilled snack bar that contains one billion colony-forming units (CFUs) of the Bacillus coagulans probiotic strain. It says this is the amount required to promote a healthy immune system.

Probiotic players in Europe face bigger barriers when marketing their products as there are currently no approved health claims for probiotics in Europe. However, brands can still leverage the perceived health benefits of gut-friendly probiotics and prebiotics by taking a multi-ingredient approach – a common ‘piggybacking’ strategy.30 Actimel, for instance, adds the vitamins D and B6 to its Immune System Fruit & Veg Cultured Shots in order to enable an immunity health claim but the product’s appeal comes principally from the perceived benefits of the fermented L.casei cultures.

In the UK, Lizi’s Digestive Health granola contains Bacillus probiotics, chicory fibre and linseed. The brand does not make a direct health claim relating to immunity but explains that the granola ‘supports the tummy’s good bacteria’ and that the right gut bacteria are vital for a healthy immune system.

Beyond digestive and immune health, a growing field of research into the gut-brain axis suggests the microbiome can also impact mood and mental health.31 One meta-analysis reviewed 24 human trials examining Lactobacillus’ effect on anxiety and found that 22 reported reduced anxiety symptoms at the end of the probiotic treatment compared to placebo controls.32 These scientific findings, combined with consumer desire to nurture mental and emotional well-being, indicates an opportunity for ‘microbiome for mental health’ products.

US supplement brand Lifted Naturals makes ‘mood boosting probiotics’ with a variety of strains including L. Rhamnosus GG, which it calls a ‘premier player in the bacteria-for-mood game’.

Big CPG companies are also eyeing this area with interest. Snack giant Mondelēz International recently bought a stake in Uplift Foods, a start-up that focuses on the ‘mood supportive benefits’ of gut-healthy prebiotic fibres and resistant starches. Its cookies are made with green banana flour and tapioca fibre for prebiotic resistant starch; Jerusalem artichoke for prebiotic soluble fibre; and kiwi fruit for prebiotic flavonoids.

8

| L earn more about Fi Global CONNECT: Health Ingredients in the Spotlight

Performance & active nutrition Valued at $15.6 billion in 2019, the global sports nutrition market is expected to grow at a compound annual growth rate (CAGR) of 8.9% from 2020 to 2027, according to Grand View Research.33 However, brands looking to tap into this booming market should be mindful of the emergence of two related-but-distinct consumer sub-groups.

Performance nutrition consumers go to the gym regularly, conduct high-intensity workouts and have specific goals they wish to achieve, such as running a marathon or improving a sprint time. They are well informed about their nutritional needs and take an active interest in functional ingredient specifics such as protein type, quantity, and quality.

Active nutrition consumers enjoy exercise and eating healthily but not in a strict way. They incorporate physical activity and healthy food to their daily lives as part of a general, proactive approach to health, and buy sports nutrition products that are positioned as better-for-you options.

Active nutrition consumers make up a much larger proportion of the population and, in recent years, have been the driving force behind the evolution of the sports nutrition category, which has seen sports nutrition products, such as protein-fortified yoghurt, become everyday fixtures on supermarket shelves. FMCG Gurus predicts a significant uptick in active nutrition consumers as a result of COVID-19-driven health concerns.34 The sports nutrition category is also being influenced by other macro food trends, such as demand for plant-based, botanical, and clean label ingredients. We take a look at each in more detail:

Sports nutrition goes natural Most US adults aged between 18 and 54 believe energy drinks are too high in artificial ingredients, suggesting a largely unmet demand for clean label sports drinks.35 US brand BodyArmor uses coconut water and natural flavours and colours for its electrolyte- and antioxidant-packed hydration drink, and has received investment from Coca-Cola – an indicator of market confidence in natural-positioned sports drinks.

Even core performance nutrition products, such as single-use energy gels typically consumed during an intense race or workout, are getting natural reformulations. Italian brand Veloforte uses real fruit for its ‘kitchen crafted’ energy ‘nectars’. The ingredient list includes unrefined rice syrup, dates, maple syrup, ginger extract, and pink Himalayan salt for a natural source of energy and electrolytes.

Sports nutrition goes plant-based Plant-based products formulated for the sports nutrition market are growing in popularity, with research indicating they may even provide quicker recovery because the naturally present phytonutrients have an anti-inflammatory effect.36 However, manufacturers should consider fortification to ensure the product has an adequate nutritional, amino acid, and digestibility profile compared to conventional animal proteins, such as whey.

Plant-based brand Orgain launched a sport line in 2020, blending pea protein with brown rice, chia seeds and botanicals such as ginger and fermented turmeric.

Health ingredients report 2021 | 9

Sports nutrition goes holistic Sports nutrition products have traditionally focussed on physical health, but product developers in the category are embracing a holistic approach that also considers mental well-being.37 When marketed appropriately, such products can appeal to both consumer sub-groups.

Ingredients that boost cognitive health appeal to amateur athletes because improved alertness and focus are beneficial to their performance, while active nutrition consumers are drawn to such ingredients because stress and anxiety can diminish general health. Spanish brand Atonia meets the former subgroup’s needs with its red berry-flavoured pre-race drink that contains stress-reducing lemon balm.

Healthy ageing In 2019, there were 703 million people over the age of 65; by 2050, this is projected to double to 1.5 billion. With one in four individuals in Europe and North America set to be aged 65 or over in thirty years, population ageing could become one of the most significant social transformations of the twenty-first century, according to the United Nations.38 Ensuring quality of life into old age – healthy ageing - will become a priority for millions of individuals.

Healthy ageing refers to the process of developing and maintaining functional abilities that enable wellbeing in older age. Research suggests there are two underlying pathophysiological processes in ageing that can be influenced by diet: low-grade inflammation (also known in this context as inflammageing) and gut dysbiosis.39 DManufacturers developing products for seniors could choose nutrients that counteract inflammageing and oxidative stress and rebalance the microbiome. A Mediterranean diet, for instance, which is high in fruit, vegetables, pulses, and olive oil, is known to reduce inflammation and promote gut microbiota, thanks to its high vitamin, polyphenol, antioxidant and high fibre content.40 Improving strength and mental wellbeing are the two most sought-after health objectives among seniors, according to an FMCG Gurus survey,41 and recent product launches have sought to deliver these benefits.

Nestlé’s BrainXpert is a ketogenic drink rich in medium chain triglycerides (MCT) and milk protein said to improve the cognitive function of people with Mild Cognitive Impairment (MCI), a transitional stage between normal ageing and dementia.42 In August 2020, Perennial launched Gut & Brain, a plant-based drink made from pea, soy, and rice protein that is fortified with DHA omega-3 fatty acid, folate, choline, and the vitamins B6, B12 and E. The product also contains prebiotic fibres to promote gut microbiota and cognitive health via the gut-brain axis.

Many sports nutrition products deliver the same nutrients as healthy ageing products and, with careful positioning, brands can appeal to both groups. Dairy group Fonterra, for instance, appointed a well-known sports commentator and former Australian Olympic athlete as the brand ambassador for its Bodiology range but the product also targets seniors as an “age-defying solution for joints, bones and muscles”.43

10 | L earn more about Fi Global CONNECT: Health Ingredients in the Spotlight

Despite the seismic demographic shift looming and the role nutrition can play in promoting healthy ageing, only 17% of global foods for special medical purposes launched in the past 12 months had a senior claim, according to Mintel, which suggests ample space for future innovation.44 Taste, texture, and mouthfeel should receive particular attention when formulating products for seniors as sensitivity to taste and smell decreases with age.45 Ensuring products are palatable to the target consumer group by including seniors in sensory tests and product evaluation panels is therefore important.

Personalised nutrition Healthy food manufacturers are embracing technological advances to create personalised products that answer the nutritional needs of different consumers.

The degree of personalisation can vary, with some brands tailoring products according to general dietary preferences, some to phenotypical data, and others to the individual’s unique microbiome or genome.

Founded by a neuroscientist, baby food brand Cerebelly asks parents to fill out a questionnaire about their infant and then creates products tailored to the baby’s current developmental stage. It uses wholefood-derived nutrients such as DHA algal oil for cognitive health or spinach-derived iron for motor skills.

Other brands create food products based on physiological data gleaned from consumers’ own smart devices. Monthly subscribers to MyAir, for instance, complete a nutrition survey and wear a smart watch that records markers for stress. MyAir uses this information to create tailored bars containing botanicals that promote mental wellness, such as ginseng and sage extract.

Personalising the nutrient profile of products means brands can help individuals achieve very specific personal goals. Canadian biotech company Nutrigenomix, for instance, uses genetic testing to personalise nutrition advice for athletes looking to improve their performance and hopeful parents wanting to improve fertility. US firm Virta Health draws up low-carb meal plans for type 2 diabetes sufferers, helping them control blood sugar without medication and even reverse type 2 diabetes. Chang Liu, market analyst at Innova Market Insights says that;

“Technology is really driving the innovation around personalised nutrition, not only for food and beverages but also apps. With tech and science breakthroughs, consumers are getting a greater understanding of themselves at a genomic level.

The uniqueness of the individual has become even more important when it comes to providing consumers with a solution for the target they want to reach, based on [their] health and body condition.”46

Health ingredients report 2021 | 11

Despite these advances, the personalised nutrition sector is currently being held back by technological limitations. Most brands in the space use information from surveys and questionnaires to personalise food or supplements, rather than real time data for each individual. Companies that offer truly personalised products currently have barriers that represent a red line for many consumers. Microbiome start-up Thryve Inside, for instance, creates personalised probiotic blends but requires consumers to send a faecal sample for analysis.

Mintel predicts that the COVID-19 pandemic, which has exposed the vulnerability of certain groups, such as seniors, expectant mums, and chronic disease sufferers to an increased risk of falling seriously ill, will further promote the trend for personalisation. However, the category’s biggest breakthrough will come with the development of technology that allows the consumer to look at real-time ‘omic’ data and make truly personalised dietary decisions as a result.47

Industry focus points Spotlight on an industry challenge: Feel or fail?

Bars and RTD beverages are popular formats for many functional ingredients because they can be consumed on-the-go. The one-time consumption occasion of snacks and drinks means consumers are happy to experiment with novel ingredients and the product can deliver an instant dose.48 However, this can create formulation problems. Julian Mellentin, founder and director of New Nutrition Business pointed out that;

“The difficulty with many of these ingredients is that you need a large dose to feel the effect […] but if you add too much of an active ingredient to food, you could end up with taste problems that need masking. The reason coffee has been nature’s energy drink for hundreds of years is because people feel the benefit.

That’s the benchmark; you have to feel the benefit for some things.”49 Brand marketers may wish to choose their wording carefully, so consumers do not expect to feel euphoric after eating a CBD gummy or to instantly fall into a sleep oblivion after drinking a hop-infused beverage.

That said, many functional products fetch a significant price premium, which could mean many consumers will want to see some sort of ‘return’ on their investment.

Finnish-American brand Four Sigmatic, which blends coffee with functional mushrooms, challenges consumers to ‘feel the difference, or it’s free’.

The slogan conveys the brand’s confidence in its own health claims and encourages curious consumers to try the product.

Many consumers are embracing the concept that health and wellness is a long-term goal, built on a foundation of healthy eating, physical activity, and replenishing sleep. A balanced diet packed with essential nutrients is therefore important – explaining the popularity of science-backed functional ingredients – but these individuals may not expect to feel an instant effect after consuming a given product.

12 | L earn more about Fi Global CONNECT: Health Ingredients in the Spotlight

Making ingredients approachable From cordyceps to reishi, L-theanine to cannabidiol, some of the most on-trend adaptogens and nootropics have relatively unfamiliar and scientific-sounding names. This could alienate some consumers – even those who are interested in the ingredient’s functional benefits.

Trend forecasters at Culinary Tides categorise ingredients according to their approachability; ingredients that are familiar, accessible, and easy to engage with are considered approachable for consumers.

Culinary Tides classifies turmeric and ginger as highly approachable adaptogens but ashwagandha and chaga mushroom as having low approachability. Caffeine is a highly approachable nootropic but rhodiola rosea, panax ginseng, and gingko bilbao are not.

However, low approachability does not mean an ingredient has less potential for sustained and rising demand. Rather, manufacturers using them should have a clear idea of their target consumer base and tailor communication accordingly. Brands should talk about the ingredient’s history of safe use, tying it to specific cultures and traditions to generate interest and increase authenticity.50

How to deliver functional benefits Ensuring functional ingredients remain active and stable in the final product, delivering benefits to the consumer, is of utmost importance.

When sourcing botanicals and natural products, product developers should be aware the level of the active compound can vary depending on country of origin, the part of the plant used and seasonal climate changes, potentially creating batch-to-batch variability. Factors such as light, temperature, humidity, time, pH level, and the presence of antioxidants can also affect nutrient content and stability.

Knowing these specifications can help brands protect their active ingredients with the right processing and packaging. Analytical testing is useful as it reveals how functional ingredients behave in the food matrix.

B vitamins, for instance, are highly sensitive to light and so dark or opaque packaging is appropriate.

A functional drink high in vitamin C – sensitive to oxidation – could be packaged in a recipient with a small bottleneck to reduce the surface area in contact with air.51 Low temperature and acidity or lyophilisation (freeze-drying) can keep probiotics in a dormant state, thus limiting any metabolic activity that could cause cell death during the shelf life of the product.52 Product format can also impact nutrient availability. Granular forms have less surface area than fine powders and so are less exposed to oxidation. Vitamin E premix in granular format has been shown to have higher levels of the vitamin (97%) after three months of storage compared to vitamin E in fine powder form (78%).53

Health ingredients report 2021 | 13

Future trendspotting Immunity Innovation: Fermented botanicals Botanicals are the most frequently cited ingredients in food and drink patents related to immune health support, accounting for 40% of patent filings in the past 10 years, followed by probiotics with 35%.54 However, a recent increase in patent filings for fermented botanical extracts suggests they could be the next on-trend ingredient for enhancing immunity.55 Pulmuone recently patented a Bacillus-fermented ginger and red ginseng extract while WellFine patented fermented leek extract. The companies, both South Korean, claim the functional ingredients have a synergistic effect in strengthening the body’s immune system.

Green and clean: Upcycled ingredients Sustainability is influencing all food and drink categories, and the nutrition sector is no different. Demands for ‘green and clean’ products are being principally driven by younger generations with just under onethird (32%) of Millennials and one-quarter (25%) of Gen Z consumers saying they almost always or usually base purchase decisions on sustainability, compared to just 17% of Baby Boomers.56 Upcycled foods, made with ingredients that would not have been eaten otherwise, are well-positioned to meet these demands.

US start-up ReGrained uses brewers’ spent grain – a nutritious and fibre-packed grain leftover from beer production – to make snack bars while British fruit jerky bar manufacturer Snact and Ecuadorian superfood smoothie maker Takay use fruit rejected by retailers for aesthetic reasons. Caskai uses cascara, the polyphenol-rich, sun-dried husks from coffee cherries, to make a lightly carbonated soft drink.

In 2020, academics and industry stakeholders agreed on an official definition of upcycled foods that will be used for future product certification, indicating that a rise in future activity is on the horizon.57

Eying up an opportunity: Vision health As computers, tablets, and smartphones become indissociable from everyday life, protecting eye health could become a top concern.

The Center for Disease Control and Prevention (CDC) estimates that US children aged between 11 and 14 spend nearly nine hours each day in front of a screen,58 and research suggests the combination of increased screen time and less time spent outdoors could be harmful to vision, increasing the risk of myopia.

In 2000, around 23% of the global population was affected by myopia; today, the figure is around 50%.59

14 | L earn more about Fi Global CONNECT: Health Ingredients in the Spotlight

This trend will drive interest in ingredients believed to protect eye health, such as lutein and zeaxanthin. Both are still niche – only 17% of global consumers have heard of lutein while even fewer people (10%) have heard of zeaxanthin – but half of the consumers who are familiar with these nutrients associate them with improved eye health, according to an FMCG Gurus survey.60 US company Life Extension has launched gummies for ‘digital eye support’ that contain a blend of lutein, zeaxanthin, and meso-zeaxanthin said to filter blue light, and marigold extract said to improve the eye’s photostress response.

In China, Love Vision developed a passion fruit-flavoured drinking yoghurt that contains lutein esters to help protect and relieve tired eyes, as well as taurine and vitamins A and E to improve night vision.61

Bringing the global food and health ingredients industry together digitally Bringing the global food and health ingredients industry together digitally

Regions in the Spotlight 12-23 April 2021 Regions in the Spotlight 12-23 April 2021 Health Ingredients in the Spotlight 14-18 June 2021 Health Ingredients in the Spotlight 14-18 June 2021 Plant-Based Ingredients in the Spotlight 13-17 September 2021 Plant-Based Ingredients in the Spotlight 13-17 September 2021

Health ingredients report 2021 | 15

Key takeaways • COVID-19 has brought the importance of a healthy diet and lifestyle into sharp focus, leading to a rise in demand for immunity products that should last well into 2021.

• Emotional and mental wellbeing is increasingly seen as an integral part of general health; adding ingredients with cognitive benefits, such as adaptogens and nootropics, can help brands attain a holistic health positioning.

• Active nutrition consumers will continue to evolve and democratise the sports nutrition category as they seek everyday better-for-you products that are both functional and convenient.

• Personalised nutrition is growing with the potential to be a disruptive innovation but technological advances are still required to make true personalisation accessible and convenient.

• Future ingredients to watch include fermented botanicals for immunity; lutein and zeaxanthin for eye health; and upcycled ingredients for a healthy and sustainable positioning.

The information provided here was compiled with due care and up to date to the best of our knowledge on publication.

16 | L earn more about Fi Global CONNECT: Health Ingredients in the Spotlight

Sources https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7492082/ https://insights.figlobal.com/health-wellness/how-covid-19shifting-demand-health-ingredients 3 https://www.fona.com/premiumization0119/ 4 Rick Miller, Food and drink Associate Director, Specialised Nutrition, Mintel, The future of specialised nutrition in the postCOVID-19 world, FI Europe CONNECT 2020 5 Mike Hughes, Head of Research and Insight, FMCG Gurus, New opportunities in holistic health, Fi Europe CONNECT 2020 6 https://insights.figlobal.com/editorial-webinars/impact-covid-19outbreak-demand-health-ingredients-demand-webinar 7 https://cdn.ymaws.com/tshp.org/resource/resmgr/r&e_ foundation/posters/2020/4584927491328279188_-_Poster.pdf 8 https://www.nhs.uk/live-well/sleep-and-tiredness/why-lack-ofsleep-is-bad-for-your-health/ 9 Emma Schofield, Senior Analyst, Global food science, Mintel, Holistic health: what are the opportunities for food and drink producers to cater to consumers' mental well-being?, Fi Europe CONNECT 2020 10 https://ec.europa.eu/food/safety/labelling_nutrition/claims/ register/public/?event=search 11 https://ec.europa.eu/food/safety/official_controls/eu-coordinated-control-plans/covid-19_en 12 Megan Eade, Innovation Technologist, RSSL, NPD with natural ingredients to boost immunity, Fi Europe CONNECT 2020 13 https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4263393/ 14 https://www.who.int/about/who-we-are/constitution 15 Consumer Trends 2030, Mintel, https://www.mintel.com/presscentre/social-and-lifestyle/mintel-2030-global-consumer-trends 16 Emma Schofield, Senior Analyst, Global food science, Mintel, Holistic health: what are the opportunities for food and drink producers to cater to consumers' mental well-being?, Fi Europe CONNECT 2020 17 Consumer Trends 2030, Mintel, https://www.mintel.com/presscentre/social-and-lifestyle/mintel-2030-global-consumer-trends 18 https://www.cosmeticsdesign-europe.com/Article/2020/07/20/ Collagen-a-highly-relevant-holistic-beauty-ingredient-in-2020says-Mintel 19 Emma Schofield, Senior Analyst, Global food science, Mintel, Holistic health: what are the opportunities for food and drink producers to cater to consumers' mental well-being?, Fi Europe CONNECT 2020 20 Effects of L-Theanine Administration on Stress-Related Symptoms and Cognitive Functions in Healthy Adults: A Randomized Controlled Trial https://www.ncbi.nlm.nih.gov/pmc/articles/ PMC6836118/ 21 https://www.ift.org/news-and-publications/food-technologymagazine/issues/2019/december/features/2020-flavor-forecast 22 https://www.sciencedirect.com/topics/biochemistry-geneticsand-molecular-biology/humulus-lupulus 23 Emma Schofield, Senior Analyst, Global food science, Mintel, Holistic health: what are the opportunities for food and drink producers to cater to consumers' mental well-being?, Fi Europe CONNECT 2020 24 IWSR Global Opportunities in Low- and No-Alcohol, https:// www.theiwsr.com/wp-content/uploads/IWSR-Press-ReleaseAs-%E2%80%98Dry-January%E2%80%99-Increasingly-ExtendsYear-Round-Opportunities-Broaden-for-Beverage-AlcoholProducers_7th-February-2018.pdf 25 https://www.nielsen.com/us/en/insights/article/2019/by-2025-theus-hemp-based-cbd-industry-will-be-a-6-billion-opportunity/ 26 https://insights.figlobal.com/regulatory/cbd-edibles-faceregulatory-challenges-eu 27 https://blog.euromonitor.com/the-rise-and-potential-of-guthealth 28 https://www.hopkinsmedicine.org/research/advancements-inresearch/fundamentals/in-depth/the-gut-where-bacteria-andimmune-system-meet 29 https://www.nutraingredients-usa.com/Article/2020/10/13/ Global-probiotics-market-grows-8-says-IPA-s-Paraskevakos 1 2

https://insights.figlobal.com/health-wellness/immunity-healthclaim-hurdles-eu-and-usa-interview 31 https://www.nature.com/articles/d42859-019-00021-3 32 https://www.sciencedirect.com/science/article/abs/pii/ S0149763419300533?via%3Dihub 33 https://www.grandviewresearch.com/industry-analysis/sportsnutrition-market 34 Mike Hughes, Head of Research and Insight, FMCG Gurus, What's next for the sports nutrition market?, Fi Europe CONNECT 2020 35 https://store.mintel.com/us-sports-nutrition-performance-drinksmarket-research-report 36 https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6356661/ 37 Mike Hughes, head of research and insight, FMCG Gurus, What's next for the sports nutrition market?, Fi Europe CONNECT 2020 38 https://www.un.org/development/desa/pd/sites/www.un.org. development.desa.pd/files/files/documents/2020/Jan/un_2019_ worldpopulationageing_report.pdf 39 https://insights.figlobal.com/fi-europe-connect-2020-programme/ healthy-diets-can-counteract-effects-inflammageing-interview 40 https://insights.figlobal.com/fi-europe-connect-2020-programme/ healthy-diets-can-counteract-effects-inflammageing-interview 41 Mike Hughes, Head of Research and Insight, FMCG Gurus, Women, seniors, e-gamers: New targets for active and performance nutrition?, Fi Europe CONNECT 2020 42 https://www.nestlehealthscience.com/sites/g/files/dnigna366/ files/2020-11/ABSTRACT%20BOOK-MCI_When%20Nutrition%20 helps%20Brain%20Energy%20Rescue.pdf 43 https://www.innovamarketinsights.com/fonterra-bets-onsupplement-growth-with-release-of-bodiology-range/ 44 Rick Miller, Food and Drink Associate Director, Specialised Nutrition, Mintel, The future of specialised nutrition in the postCOVID-19 world, Fi Europe CONNECT 2020 45 Sensory Functioning in Older Adults: Relevance for Food Preference, https://www.ncbi.nlm.nih.gov/pmc/articles/ PMC6291213/ 46 Chang Liu, Market Analyst, Innova Market Insights, Personalised nutrition - tailored to fit, Fi Europe CONNECT 2020 47 Rick Miller, Food and Drink Associate Director, Specialised Nutrition, Mintel, The future of specialised nutrition in the postCOVID-19 world, Mintel, Fi Europe CONNECT 2020 48 https://www.foodnavigator-usa.com/Article/2017/12/15/ Adaptogens-are-here-to-stay-but-marketing-them-effectively-willrequire-creativity-and-innovation-say-experts 49 https://insights.figlobal.com/editorial-webinars/impact-covid-19outbreak-demand-health-ingredients-demand-webinar 50 Suzy Badaracco, President, Culinary Tides, Cognitive function: how foods and nutrients aid in coping with stress, sleep, memory, depression and energy concerns, Fi Europe CONNECT 2020 51 Rachel Reid, Group Leader, Functional ingredients and lipids team, Reading Scientific Services Ltd, NPD with natural ingredients to boost immunity, Fi Europe CONNECT 2020 52 https://isappscience.org/how-do-probiotics-stay-alive-until-theyare-consumed/ 53 Rachel Reid, Group Leader, Functional ingredients and lipids team, Reading Scientific Services Ltd, NPD with natural ingredients to boost immunity, Fi Europe CONNECT 2020 54 https://www.mintel.com/food-patent-watch 55 https://www.mintel.com/food-patent-watch 56 https://www.hartman-group.com/newsletters/364578727/ younger-generations-and-sustainability-mad-as-hell-and-whosgoing-to-fix-it 57 https://www.newhope.com/food-and-beverage/upcycledfood-gets-official-definition 58 https://www.cdc.gov/nccdphp/dnpao/multimedia/ infographics/getmoving.html 59 https://theconversation.com/increasing-screen-time-during-thecoronavirus-pandemic-could-be-harmful-to-kids-eyesight-138193 60 Mike Hughes, Head of Research and Insight, FMCG Gurus, Women, seniors and e-gamers: new target audiences for active and performance nutrition?, Fi Europe CONNECT 2020 61 https://www.mintel.com/blog/drink-market-news/eye-healthproduct-innovation-to-gain-in-thailand 30

Health ingredients report 2021 | 17

Learn more about Fi Global insights:

insights.figlobal.com

Snacking the modern way An overview of EU and US trends | 18