1. What are Chr. Hansen's current operations and activities in LATAM? And why are LATAM markets key areas for Chr. Hansen?
In Latin America, Chr. Hansen started exporting its enzymes to Ecuador almost 100 years ago and today has operations across the continent. We operate with two plant facilities, one located in Brazil and another in Peru. We have sales offices in the main markets including Brazil, Argentina, Colombia and Mexico. Each branch covers a specific geographical area.
As a natural ingredients supplier, Chr. Hansen serves different segments, categories and niche markets with attractive growth potential. Latin America is one of the emerging regions with growth potential for our company.
Representing 12% of Chr. Hansen Group’s revenue, originating from its three divisions (Food Cultures & Enzymes, Health & Nutrition and Natural Colors), the Latin America region saw 21% organic growth in the fiscal year 2018/19.
2. What are consumers’ top questions and needs when it comes to nutrition, natural ingredients and bioscience demands?
Consumers worldwide are searching for products that help them to meet their needs for healthy, safe, convenient, tasty and authentic products. They are more conscious about what they eat and more avid to experience new variants in the market. They are looking for products that can offer functional benefits and nutritional values.
Both might help to improve their wellbeing, manage weight, improve energy level and facilitate their daily routine by offering convenient solutions with a short list of ingredients. Consumers want to see more products on the shelves containing ingredients in the recipe that they can recognize and understand. They want more ‘real food’.
3. What are the top trends you're seeing in the nutrition, natural ingredients and bioscience LATAM markets today driving these?
Sugar reduction, protein and cleaner labels are the top trends we have seen in LATAM, driving the industry for innovation development. Besides sugar reduction being one of the market trends for the new product development agenda, it is also a regulatory theme in many countries in Latin America. There is a concern related to sugar consumption and the risks associated with it.
Protein has gained attention from consumers and the industry has been launching a range of products with different combinations and protein content to address consumer needs. Clean labeling is one of the most important trends to move forward in Latin America. When consumers want products that are closer to real food, a shorter ingredients list is required, but with natural ingredients as part of it. It is not just reducing the list, but also replacing artificial ingredients by natural ones that will generate attention from consumers.
4. How is Chr. Hansen responding to these trends?
We offer natural ingredient solutions that can lower sugar and replace artificial preservatives by natural bioprotective cultures, for example, which also plays a role in reducing food waste because yogurt stays fresh for longer.
Our overall promise is to improve food and health. We will do this by enabling the wider adoption of natural ingredients to address global challenges within food, health and agriculture. By collaborating with customers and partners to innovate products and processes, we strive to meet and create future demand for innovative natural solutions that advance food, health and productivity for the benefit of us all.
5. Where do you think the nutrition, natural ingredient and bioscience segments in Latin America are heading?
Even though the trends originate from more mature markets, consumer awareness, social media communities and globalization are accelerating the adoption of these trends in Latin America.
Dairy products have a healthier image, so natural ingredients are expected to grow in this category, particularly in the children's product segments.
6. What are the key opportunities and challenges in Latin America?
In Latin America, we have opportunities in cleaner labels and naturally functional ingredients. The per capita consumption in most countries in Latin America is relatively low compared to mature markets, providing opportunities to expand with new offerings and/or GDP increment.
Also, we have seen some changes emerging in consumer consumption habits, such as consuming less animal sources of protein and opening new plant-based protein alternatives. This requires new ingredients and open opportunities to expand the business. Chr. Hansen already has a series of cultures in place for fermented plant-based dairy alternatives.
One of the challenges in doing business in the region is the market fragmentation. We face different social-economic scenarios, governments, legislation, etc. So, we need to follow specific requirements and sometimes even adapt formulation to be compliant. Some of the countries in Latin America are also facing economic turbulence, which impacts consumption. Sustainability is another important and challenging theme. From the food chain, this will require the ability and efforts to innovate, launch and commercialize products with less environmental impact.
7. What are Chr. Hansen plans for 2020 and beyond in LATAM?
Latin America is one of the regions where Chr. Hansen has been present for many years. We will continue to work for a more sustainable future defined by natural ingredients, considering innovation as a pillar for growth and response to key global drivers and trends. Our strategy is to keep focused on our core competencies in our field, always keeping our high proximity with our customers and sharing our global insights into market trends and opportunities to support customers.
Our aim is to capture local business opportunities, creating value through cutting edge solutions and supporting our customers to develop exciting new products that address different consumer needs.