CBI Trade Statistics

Natural Colours,
Flavours and Thickeners
Broadcasting your trade statistics
Management summary
The European colours, flavours and thickeners market has shown strong
performance over the past 5 years. The market has now fully recovered from
the global economic crisis, which had caused a dip. Higher prices of raw
materials and more production of complex products caused a strong increase in
turnover of colours, flavours and thickeners manufacturers. Natural flavours
gained market share at the cost of synthetic flavours and this shift is expected
to continue in the next few years.

Imports of colours, flavours and thickeners

Figure 1: Leading suppliers of European imports of
natural colours, 2009-2013, in million
600

Figure 2: Leading European importers of natural colours,

2009-2013, in million
120

500

India

400

Peru
China

300

100

2011

80

2013

60

200

Other DC
imports

40

100

Non-DC
imports

20

2009

0
2009

2011

2013

Netherlands

Germany

Spain

France

UK

Source: Eurostat (2014)

Source: Eurostat (2014)

Figure 3: Leading suppliers of European imports of

natural flavours, 2009-2013, in million

Figure 4: Leading European importers of natural flavours, 20092013, in million

1,400

Indonesia

1,200

Brazil

1,000
800

Argentina

600

China

400

India

200
0
2009

Source: Eurostat (2014)

2011

2013

Other DC
imports

300
2009
2011
2013

250
200
150
100
50
0
France

Germany

Source: Eurostat (2014)

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UK

Netherlands

Ireland

CBI Trade Statistics Natural colours, flavours and thickeners

Figure 5: Leading suppliers of European imports of

natural thickeners, 2009-2013, in million

Figure 6: Leading European importers of natural thickeners, 20092013, in million

300

1,400
Pakistan
1,200

250

2009

Philippines
1,000

2011

200

China

2013

800
Sudan
600

150

India

400

100

Other DC
imports

200

50

Non-DC
imports

0
2009

2011

2013

Germany

Source: Eurostat (2014)

France

UK

Italy

Spain

Source: Eurostat (2014)

Table 1: European imports of natural colours, flavours and thickeners, 2013, value in million and
volume in thousand tonnes
Product group

Import value

Import volume

Colours

498

64

Flavours

1,239

115

Thickeners

1,180

324

Total

2,893

502

Source: Eurostat (2014)

Suppliers of natural colours, flavours and thickeners benefit from rising price levels
Between 2009 and 2011, the global food ingredients market recovered again
from the global food crisis and European buyers replenished their stocks.
Leading suppliers India and China benefited most from the recovery,
followed by Sudan and Brazil.
Although prices of a few raw materials decreased in 2013 (e.g. gum Arabic),
rising average costs of raw materials and energy continued to drive up total
import values in 2013. Moreover, China and India are becoming major
consumption markets that compete with European buyers for raw materials.
Suppliers of guar gum benefited from exceptionally high prices ( 15 /kg)
between 2010 and 2012. Prices came down to 2 after decreased interest
from the oil industry and increased production.
Nonetheless, high pressure on land use in certain geographical areas can
cause farmers to switch to others crops. It is therefore expected to lead to
sustained higher prices for raw materials which can only be grown there.
Supply chain problems for many natural colours, flavours and thickeners
slow down imports of these products. Many European food and beverage
manufacturers continue to use synthetics, as supply chains for those
products are sometimes more reliable.
Major suppliers of flavours such as citrus and vanilla are developing strong
provenance stories, which strengthen trade relationships with their buyers.
By using the provenance story in their marketing, buyers also make
themselves more dependent on these particular products.

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Netherlands

CBI Trade Statistics Natural colours, flavours and thickeners

Table 2: DC suppliers of colours, flavours and thickeners

Leading DC
suppliers

Main products

Share in European
import value
(2013)

Annual growth
(2009-2013)

India

Guar; oleoresins

9.4%

23.4%

China

Essential oils other

than mint and citrus;
carrageenan

6.9%

16.7%

Brazil

Citrus oils

2.2%

12.0%

Indonesia

Essential oils other

than mint and citrus;
carrageenan

2.1%

10.4%

Sudan

Gum Arabic

2.3%

16.2%

Argentina

Lemon oil

2.2%

16.1%

Philippines

Carrageenan

1.5%

-1.9%

Source: Eurostat (2014)

Cochineal and turmeric are two major natural colours imported into the EU.
Peru, accounting for 85-90% of global cochineal production, exported
cochineal with a value of approximately 42 million in 2013. Between 2010
and 2013, cochineal export value fell sharply from 156 to 42 million.
After 2 years of exceptionally high prices, price levels had normalised again.
India accounts for most supplies of turmeric and exported 89 thousand
tonnes in 2012 with a market value of 65 million.

Table 3: Market value of colours

Carotenoids

Market value 2010

in millions*

Expected annual growth

(2010-2018)

Beta-carotene

197

3.1%

Lutein

176

3.6%

Astaxanthin

170

n/a

Capstanhin

96

n/a

Annato

96

n/a

Other

171

n/a

Total

906

2.3%

* food industry and others

Source: BCC research

CFA1: If you supply a product which cannot be sourced in Europe, promote it as

a unique product and stress the particular production conditions
CFA: Be careful with market entry at times that prices are exceptionally high, as
they can fall rapidly
CFA: Please refer to CBIs Product Factsheets for more information on specific
flavours, colours and thickeners, including prices, trade channels and
competitive forces
CFA: Improve the reliability of your supplies to Europe to facilitate substitution
of synthetics by European manufacturers

Considerations for action

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CBI Trade Statistics Natural colours, flavours and thickeners

CFA: Stress the reliability of your supplies in your promotion

CFA: If you want to position your product as a unique product, you can relate a
provenance story to your products specifications

Exports of colours, flavours and thickeners

Figure 7: Main destinations of European exports of colours, flavours and
thickeners, 2009-2013, in million
2,500

Italy

2,000

UK
Netherlands

1,500

France
Germany

1,000

USA
500

Other destinations

0
2009

2011

2013

Source: Eurostat (2014)

Large companies dominate intra-EU trade

Exports by European companies mainly consist of value-added products (i.e.
blends of different thickeners and flavour ingredients).
The re-exporters are primarily concentrated in Western Europe and 60% of
these re-exports are destined for other European countries.
The port of Rotterdam in the Netherlands is one of the main European
distribution hubs where customs clearance takes place. This explains the
large role of the Netherlands in re-exports.
Market

Total European exports (2013)

Main (re-)exporters
million

million

tonnes

Colours

530

46 thousand

Netherlands (134), Germany

(73), Denmark (67)

Flavours

998

59 thousand

France (240), UK (168),

Germany (132)

Thickeners

783

152 thousand

France (172), Spain (143),

Germany (119)

Source: Eurostat (2014)

In the short term, European exporters will expand their business significantly
in East European markets and other emerging markets, such as Southeast
Asia and Latin America. This will increase competition in the respective
markets. However, growth in these emerging markets may also increase
opportunities for other suppliers.
In that same period, the shares of natural and synthetic flavours in total
exports are expected to slightly change in favour of natural flavours.

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CBI Trade Statistics Natural colours, flavours and thickeners

CFA: Please refer to CBIs Market Channels and Segments for more information
about trade structure.
CFA: Emerging markets outside Europe, such as Southeast Asia and Latin
America also offer plenty of opportunities.
CFA: Please refer to the following section on industrial demand for more specific
information on the European industry and its key players

Industrial demand
Flavours
Figure 8: Development of the worlds leading flavour manufacturers, sales in
billion
20

Other

18

Robertet SA

16

Frutarom

14

T. Hasegawa

12

Mane SA

10

Sensient Flavours

Takasago

Symrise

IFF

Firmenich

0
2009

2011

2013

Givaudan

Source: Leffingwell & Associates (2014)

Demand for flavours remains strong

Increased West European demand for more complex flavours has driven
sales values of flavour manufacturers upwards. In Eastern European
markets, increased demand for flavours in general has stimulated sales.
Emerging markets outside Europe, such as Southeast Asia and Latin
America, also made a significant contribution to the growing sales of flavour
manufacturers.
In recent years, natural flavours performed notably better than synthetic
flavours as a result of the clean labelling trend. Clean labels do not contain
the names of ingredients which sound unhealthy to the majority of
consumers, such as chemicals.

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CBI Trade Statistics Natural colours, flavours and thickeners

Figure 9: Composition of Western European flavours market in 2009 and 2014

Source: RTS Resource, 2010

Rising costs of raw materials, such as essential oils, and energy continued to
drive up sales values of flavours in 2013. Suppliers of the raw materials
benefit from the high prices.
Between 2012 and 2013, the euro crisis, which mainly affected South
European countries, caused a stagnation of growth in demand for flavours in
these countries. Since most economies recovered from the crisis in 2014,
demand for flavours is expected to grow again.
Consumer interest in natural flavours also remains strong in 2013, as
consumers continue to look for natural and healthy products.

CFA: You can target both Western and Eastern European markets to diversify
your markets and reduce dependency on either single market
CFA: If you aim to export relatively expensive, niche flavours, Western Europe
offers most opportunities
CFA: Clean labelling offers opportunities to suppliers of all natural ingredients,
except for those that are not perceived to be healthy
CFA: Rising prices for flavours and their raw materials indicate good
opportunities to enter the market, as supplies do not meet demand
CFA: For more information on the European food industry, please refer to the
2012 Data & Trends of the European food and drink industry, as provided by
FoodDrinkEurope

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CBI Trade Statistics Natural colours, flavours and thickeners

Colours
Figure 10: Composition of the global market for food colours, 2011

24%
39%

Natural colours
Synthetic colours
Nature-identical

37%

Nature identical colours have the exact same molecular structure as the naturally derived
equivalent, but are derived through chemical synthesis instead
Source: Market Research Times, 2013

Natural colours continue to gain market share

Between 2007 and 2011, the value of the global food colours market
increased by 13% to an estimated 1.6 billion. The share of natural colours
(39%) overtook the share of synthetic colours (37%).
The greatest shift from synthetic to natural colours occurred in Europe. In
Europe, research into the negative health aspects of certain synthetic colours
received considerable media attention. Between 2009 and 2011, 85% of
colours used in new food and beverage launches were natural. Estimates of
the European natural colours market range from 155 to 193 million.
Consumers perceive natural colours to be safer than synthetic colours. In
addition, the perceived health benefits of some natural colours (such as
curcumin, beta carotene, lutein and lycopene) encourage the replacement of
synthetic colours. Natural colours have become increasingly stable in varying
conditions of temperature, light and pH and, as a result, can more easily
replace synthetic colours than in the past.
Future growth of natural colours is threatened by rising raw material costs
and supply insecurity. Many manufacturers have already undertaken
measures to safeguard future supply, such as joint ventures with producers.
CFA: Support manufacturers in switching to natural colours by addressing two
problems:
1) lack of knowledge about reformulation with natural ingredients: provide
detailed information about specifications, applications and behaviour under
different temperatures, acidity levels and light conditions
2) quality inconsistencies: implement a strict quality management system to
supply products with a consistent quality
CFA: Stabilise supply volumes by increasing control over your own supply
chains, protecting crops against irregularities in climatic conditions (e.g.
controlled irrigation) or keeping stocks
CFA: Secure long-term business with existing buyers instead of short-term
profit from single orders

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CBI Trade Statistics Natural colours, flavours and thickeners

Thickeners
Figure 11: Composition of global thickeners and other hydrocolloids market
2%

1%

1%

Starches

1%

Gelatin

3%

3%

Pectins

3%

Carrageenan
4%

31%

Xanthan
Agar

5%

Gum Arabic
5%

Carboxy Methyl Cellulose

Locust bean gum

10%

Alginates
11%

20%

Guar gum
Microcrystalline cellulose
MC/HPMC
Other

Source: Food Ingredients First, 2009

Demand for thickeners is stable

The European market for thickeners was estimated at 1.4 billion in 2012,
which represents one third of the global market.
From 2011 to 2012, the European food industry grew by 3.1%, which has
been a driver for the thickeners market. However, unstable supply chains for
many thickeners, mainly due to adverse weather conditions, limited the
positive effect of this development.
Maturity and saturation of the Western European markets is slowing down
growth in 2013; this will continue into the near future. In contrast, Eastern
European markets add to the growth rate.
In the short-term, the European market for thickeners is expected to grow as
there is an increasing demand for low-calorie and low-fat food products.
In the long-term, greater demand for new, complex foods (e.g. slower
melting ice cream) will drive industrial demand for natural thickeners.
However, the growth rate will be low, as the sustainability of supplies of
many thickeners is under pressure.
CFA: The fact that many food and beverage manufacturers still use synthetics,
less efficient thickeners (e.g. starches) and non-vegetarian thickeners (e.g.
gelatine), means there are still many opportunities for substitution by natural
gums
CFA: If a thickener that is in short supply could be replaced by your thickener
(e.g. guar and tara gum), target users of the relevant thickeners and highlight
the substitution options
CFA: As most Eastern European markets are supplied through traders in
Western Europe, you do not need to adapt your distribution strategy if you are
already supplying to these traders

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CBI Trade Statistics Natural colours, flavours and thickeners

Production
Flavours
(!) Please note that production data on essential oils is unavailable or incomplete
from several European countries. For that reason, production is based on the
following countries: France, Germany, Italy, the UK, Denmark, Greece, Spain,
Poland, the Czech Republic, Hungary, and Bulgaria. Therefore, care should be
taken when drawing conclusions based on the figure below.
Figure 12: European production of essential oils, 2009-2013, in million
700
600
Other

500

Bulgaria
400

UK
Italy

300

Spain
Germany

200

France
100
0
2009

2011

2013

Source: Prodcom (2014)

Market efficiency keeps European production profitable

Between 2009 and 2011, growing demand for natural ingredients,
particularly for fragrances, and high prices drove essential oil production in
terms of value. From 2011 to 2013, average prices and production of
essential oils stabilised with exceptions for individual products.
In the short-term, production is expected to remain stable, as producers
have strong ties with manufacturers of flavours, foods and beverages. The
latter often prefer to purchase from European producers, as these generally
have better reputations than producers in developing countries.
As suppliers in developing countries improve their reputation, they will
become stronger competitors. Competition is therefore expected to lead to a
decline in European production in the long term. Production of flavours that
require a great deal of labour will come under most pressure.
CFA: Benefit from low labour costs in your country to compete on price with
European producers
CFA: Improve your reputation by:
1) Submitting representative batch samples
2) Delivering according to the agreed terms
3) Showing an understanding of the buyers needs
CFA: Please refer to CBIs other Market Intelligence products on Natural colours,
flavours and thickeners for more information

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CBI Trade Statistics Natural colours, flavours and thickeners

Thickeners
Figure 13: Provenance of thickeners and other hydrocolloids in Europe

Source: ProFound

Europe only produces a few types of thickeners

European production of thickeners is coming under pressure from foreign
competition. Locust bean gum producers face particularly strong competition
from guar gum producers in India and Pakistan, and tara gum producers in
Peru.
Many seaweeds and algae used for European production of thickeners are
already sourced outside Europe. The Philippines, India, China and Indonesia
are major suppliers of (semi-)processed seaweeds and algae.
Pectin production in Europe has grown strongly. Major manufacturers have
invested heavily in the production of this natural gelling agent and stabiliser
in response to the clean labelling trend.
CFA: Despite good alternatives for high-priced thickeners which are produced in
Europe, many food manufacturers lack the knowledge about availability and
application of such alternatives and need to be informed
CFA: Supplies of seaweed- and algae-based thickeners are dominated by very
strong companies, which makes it difficult for SMEs to enter this market
CFA: Producers of thickeners which can be substituted by pectins face strong
competition

This survey was compiled for CBI by ProFound Advisers In Development

in collaboration with CBI Sector Expert Peter Meschede
Disclaimer CBI market information tools: http://www.cbi.eu/disclaimer

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