Value-Added Fresh Vegetables Positioned for Growth

Health and convenience will be the leading drivers of increased demand for fresh vegetables in the next five years, according to a report released today from Rabobank's Food & Agribusiness Research and Advisory (FAR) group. The report cites the growing U.S. health crisis and consumer desire for easy-to-prepare meals among the reasons.

The report notes that even though Americans are concerned about the U.S. obesity epidemic, the stand-alone marketing of a "healthy benefit" to mainstream consumers isn't enough to increase consumption of fresh vegetables -- evident by the overall flat consumption rate of fresh vegetables in recent years. The report recommends that produce firms put more emphasis on creating value-added products that are not only healthy, but easy to prepare.

"As grower-shipper processors look to increase sales of fresh vegetables, we believe the solution really lies with the concept of healthy convenience," said the report's author, Karen Halliburton Barber, assistant vice president and senior agricultural analyst for FAR. "The idea is to give consumers the best of both worlds: the healthfulness of fresh vegetables and the convenience of processed foods."

The report references a recent argument posed by the New York Times, stating that fresh, unprocessed, so-called 'real food' is no more expensive than processed 'junk food.' Rather, the deterrent from healthy food eating among mainstream consumers has been the inconvenience of time it takes to prepare the food.

Furthermore, the report recommends that grower-shipper processors invest in more product differentiation, including producing vegetables with naturally enhanced micronutrient content and bolder flavors; offering more ethnic vegetables and flavorings; and catering to local and regional appeal. The report identifies that to achieve this differentiation, some producers will likely need to change their product mix and adjust their production and sourcing partnerships -- including recognizing the continuing rising popularity of private labels in a post-recession world.

"As stores develop and expand their own private label offerings, it creates a challenge for established brands," said Barber. "Though some leading branded processors are supplying private labels, there's a risk of diminishing their own heavily invested brands."

Rabobank believes that overall, grower-shipper processors are uniquely positioned to compete by creating new products and possess the means to grow the market for fresh vegetables by adapting to consumers' evolving demand for healthy, convenient foods.

'Coffee war' brewing in China

A coffee war is breaking out in China as Starbucks goes head-to-head with Britain’s Costa Coffee and a handful of Asian chains.

Starbucks, the world's biggest coffee chain, is opening cafés in China at a rate of one every four days in its quest to expand from about 570 shops currently to more than 1,500 by 2015.

The company's rivals in China include Costa Coffee, South Korean-owned bakery chains Paris Baguette and Tous Les Jours, and Hong Kong’s Pacific Coffee.

They are also battling it out with US giants McDonald's, Dunkin' Donuts and Coffee Bean & Tea Leaf for a lucrative share of China’s coffee drinking market which includes both foreigners and locals.

James Roy, senior analyst at China Market Research, a Shanghai-based consultancy, said: “Coffee shops are opening everywhere in China. While you used to only see a Starbucks in first-tier cities and larger coastal cities in Hangzhou, they are now in more of the smaller provincial capitals like Changsha and Guiyang and are expanding into third-tier cities as well.”

Pacific has about 55 outlets so far, mostly concentrated in Shanghai, Beijing, Shenzhen and Guangzhou, with a few others in a handful coastal second-tier cities like Hangzhou and Qingdao.

Mr Roy added: “In their first few years Starbucks had been targeting expats and foreigners more. They and their competitors are now clearly focusing on locals as interest in coffee-drinking has grown. In particular, Starbucks has done an excellent job of positioning itself as an aspirational brand in China.”

Britain’s Costa has positioned itself as slightly premium to Starbucks and has more luxurious shop environments, including more sofas and plush seats.

Prices are slightly higher than Western prices - a grande cappuccino, for instance, costs about 60p more. Joe Drury, a British expat living in Shanghai, said: “I don’t mind paying a bit extra for my morning shot of caffeine as it tends to be more about the experience and environment. A price war may help drive prices down a bit but most expats don’t mind paying these prices for a home comfort like freshly brewed coffee.”

Amy Moir, who works for a British accountancy firm in Shanghai, added: “The Chinese don't drink coffee as a morning pick-me-up but as a social activity for relaxing with friends or business meetings, so the peak times are in the early afternoon rather than the morning.”

Curry may help in fight against bowel cancer, study finds

Curry may help to boost the chances of fighting bowel cancer, according to researchers in the UK.

Laboratory tests suggest curcumin, a compound found in the yellow spice turmeric, can increase the effectiveness of chemotherapy.

Curcumin has powerful anti-inflammatory properties and has traditionally been used as an alternative remedy for a host of illnesses.

Now early test results suggest it may be able to reduce the development of bowel cancer.

The studies began after it was noticed that British Asians -- referring to Indians and Pakistanis -- were significantly less likely to develop the disease than non-Asians.

Now a two-year trial by scientists from Cancer Research UK and the University of Leicester aims to recruit for further tests about 40 patients with bowel cancer that has spread to the liver.

"We are very hopeful. You don't often see results like the ones we have had in the laboratory," chief investigator Professor Will Steward said.

"Certainly it is very, very promising and we are cautiously optimistic that we might see an improvement in outcome not just in terms of treating the cancer, making people live longer, giving people a better quality of life but also possibly reducing some of the nasty side-effects of chemotherapy."

Researchers hope that within three years they will have established once-and-for-all that one of our favorite curry ingredients is helping to prevent bowel cancer.

U.S. Ice Cream Market Tops $25 Billion

Edvard Munch's iconic "The Scream" just sold for a record $120 million at auction in New York, but that's peanuts compared to the very voluble demand for ice cream, as indicated by Ice Cream and Frozen Desserts in the U.S. , a just-released market research report from Packaged Facts.

According to Packaged Facts, sales topped $25.1 billion in 2011, up 2.4% over the previous year--representing a small upswing after two years of flat sales. Because ice cream and frozen desserts purchased in foodservice channels have a higher ticket price per serving than do their counterparts purchased in retail channels, foodservice is the larger of the two sectors in dollar terms, accounting for 57% of overall sales. Within the retail mass market for packaged products, packaged ice cream is the largest category, accounting for 55% of total retail sales, followed by frozen novelties at 36%. The fastest dollar growth, however, came from the frozen yogurt/tofu specialty segment.

In the mature U.S. marketplace for ice cream and frozen desserts, according to Packaged Facts publisher David Sprinkle, marketers, retailers, and foodservice providers can grow their businesses by creating and marketing products that speak to today's consumers on an emotional level. Along with localized strategies and niche products representing true differentiation, integrating new media into the marketing mix can create buzz and communicate brand attributes that are responsive to the desires of economic downturn-weary Americans wanting to indulge without breaking the bank.

Ice cream and frozen desserts is a highly competitive market, with two multinational conglomerates--Nestlé and Unilever--at the top of the heap. Across the country, nonetheless, are hundreds of regional and local competitors that often go head-to-head with the industry giants in particular geographic markets, with many local and regional brands commanding the loyalty of generations of customers. In addition, a slew of niche companies run by entrepreneurs are making more than a blip on the radar screen with innovative and truly differentiated products. Also in the mix is a generous swirl of private label, with the improved quality of store brands making them an attractive price/value alternative to premium brands.