Consumers demand functional "low and light" products

Concerns about weight and health continued to drive the market for low and light foods last year, but interest in functional foods kept the market's growth rate to a steady 2-3 per cent compared to 2002. Growth in the US was also steadied by increasing concern over the adverse effects of trans fats, saturated fats and salt in the diet, leading consumers to choose products without these ingredients rather than those labelled as "low" or "light". Nonetheless, the US led the "low and light" market with product sales worth $38bn (€28bn). UK consumers spent the most on these foods per capita, throwing $164 (€122) per person at these foods, compared to American spending of $125 (€93), and $115 (€86) in Australia. The overall market for these products in the US, the UK, Germany, Italy, France, Spain and Australia was worth a total of $66bn (€49bn) last year. Low-fat foods were most widely consumed in this category, with sales of $29.7bn (€22.2bn) in 2006, just ahead of reduced-sugar/sugar-free foods and drinks with a market share of $28.7bn (€21.4bn) and low-calorie foods totalling $26.5bn (€19.8bn). Dairy products and beverages dominated with the highest share (42 and 40 per cent respectively) of the specific food markets. The markets for bakery and snacks and prepared foods were much lower, but they showed better growth rates. Despite the challenges, Leatherhead forecast that worldwide sales of low and light foods will continue to grow in the coming years at between 2-3 per cent per annum if food manufactures concentrate on making products more convenient, offering consumers a wide range of products and focus on quality rather than price. Sales in the relatively mature US market will be relatively slow, with much faster growth in the less mature markets, such as Italy and Spain, where increases of over 5 per cent per annum are predicted. The UK, Germany, France and Australia are likely to see growth somewhere between the two. This predicted growth is likely to be fuelled by rising obesity rates, the further development of functional low and light product lines, and increasing tie-ups and joint ventures with weight management brands to give credibility to weight control lines. Leatherhead cited General Mills' recent tie-up with the Curves weight management brand in the US as a key example of this way of working. Obesity levels in the developed world are already high and increasing at a worrying pace. In the US, 65 per cent of the adult population are classed as overweight and 30 per cent obese. Figures for the UK and Australia are nearly as high, while levels are less severe in continental Europe, but are increasing, said Leatherhead. Some manufacturers of low and light products have already incorporated functional ingredients into their foods and Leatherhead predicted rewards for those that followed suit. The best sectoral growth is predicted for the relatively undeveloped bakery and snacks and prepared foods markets, although the well-established light beverages market shows no signs of slowing down in many countries.