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Market drivers in South America such as increasing urbanisation, affluence and health-consciousness are opening up the market for natural and healthy ingredients. Moreover, with forward-thinking government policymaking creating an informed consumer base, there’s no better time than now to explore your opportunities in South America’s key markets.
Health is a key driver in South America, with increasing rates of obesity, diabetes and heart disease leading consumers to demand more natural, healthy and organic products. A recent World Health Organization (WHO) study indicated that over 200 million South Americans are now considered overweight or obese.
Sugar reduction in food and beverages is a key issue, along with the growing demand for natural sweeteners such as stevia. According to Mintel, Latin America accounted for 17% of global food and beverage product launches featuring stevia in 2017. On the same note, over 25% of Brazilian adults are currently hypertensive, as the population consumes twice as much salt as the internationally recommended level.
With the rise in health consciousness, there has also been an increased demand for protein-rich products. A recent survey commissioned by Arla Foods Ingredients found that nearly two-thirds of South Americans would be willing to pay extra for food or beverage products that are higher in protein, presenting a clear market opportunity for ingredients suppliers.
“South America has grown to become an important market for protein suppliers in recent years. Consumers in the region have good awareness and knowledge of protein and appreciate its benefits to their health.” – Anne Hoest Stenbaek, Senior Global Marketing Manager at Arla Foods Ingredients
The South American functional food market also looks promising, with products for weight management experiencing impressive growth due to the popularity of novel innovative ingredients such as yacon root. In Brazil, fortified/functional packaged food is expected to remain the largest category within health and wellness over the next five years, while ‘better for you’ packaged food and ‘free from’ options are also likely to increase their market share.
Functional dairy products hold the highest market value in the Brazilian market, with popular products including fortified flavoured milk drinks, fortified yogurt, and probiotic yogurt. In fact, the South American probiotics market is expected to increase by 7.1% between 2018 and 2023.
Moreover, consumer interest in local ingredients such as pendant amaranth and cañihua grains presents manufacturers with the opportunity to explore regional traditions and support local growers. The popularity of breakfast cereals in key markets such as Brazil also suggests that there is significant market potential for new cereal products.
Another South American health trend influencing new product development is the growing awareness around carbohydrate consumption. In 2017, around 41% of Brazilians said they were limiting their carbohydrate intake or were interested in doing so in the future. Pasta has long been a staple in many South American countries, but per capita consumption has been declining, which is opening up the market for ‘better-for-you’ innovations such as protein-enriched pastas.
Natural fats and unprocessed fats from natural sources such as butter are increasingly being considered important components of a healthy diet. As fat continues to lose its negative stigma, butter brands should enjoy even greater prominence.
The clean eating trend is also driving significant change in the South American food and beverage industry, with more consumers seeking products that are less processed, healthier, and ‘free from’ perceived negative ingredients. From 2012 to 2016, interest in organic foods increased by more than 20%, with six out of ten shoppers claiming that no preservatives and no artificial sweeteners are extremely important factors in influencing them to try a different food or beverage brand.
Ready to export your ingredients to South America? Explore your opportunities at Fi South America now!