John Cahalane, president and CEO of Kerry Asia Pacific, Middle East and Africa (APMEA), shares how Kerry is investing in Australian food and beverage as it evolves into a more health-focused sector.
Kerry is a world-leading taste and nutrition company that was founded in 1972 on a greenfield site in Ireland. Guided by their in-depth understanding of international market dynamics, insight into consumer trends, shifting taste preferences and evolving nutritional requirements, it has grown strategically.
Developing taste and nutrition solutions for global food and beverage markets, Kerry has become the co-creation partner of choice through its broad technology foundation, customer-centric business model and integrated solutions capabilities. Recently, it has demonstrated a renewed focus on the Australian food and beverage market in particular.
Having recently travelled to Australia to shore up business, Kerry APMEA president and CEO, John Cahalane, shared his views on the food and beverage landscape both nationwide and globally.
“Proactive health concerns are at the forefront of purchasing decisions across all generations,” Cahalane said. “Kerry research shows that consumers in all age groups globally, including Australia, are interested in food and beverages with functional benefits – with demand for immune support, joint health and digestive health particularly high.”
For Australian consumers, the demand for functional foods, beverages and supplements has continued to grow. For example, since COVID-19 began one in four Australians say they are buying more fortified products.
“Kerry’s 2021 Global Consumer Survey on Immune and Digestive Health showed that a strong immune system and healthy gut are top reasons why Australians would buy a healthy lifestyle product, and that consumers preferred food and beverages over supplements to support their nutritional needs,” Cahalane said.
In terms of health benefits in foods, immune health ranked number one at 54 per cent, followed by digestive health at 47 per cent with 53 per cent of Australian consumers strongly associating probiotics with good gut health, second only to fibre. Notably, 74 per cent prefer to get their health benefits from food and beverages, and 34 per cent rely on fruit and vegetable juices to strengthen their immunity and digestive health.
However, consumers were more likely to buy a product if it is supported by scientific data, and the likelihood to purchase comes down to research and transparency, with 47 per cent of Australian millennials saying they are more likely to buy a healthy lifestyle product if they have done their own research on the ingredient and its benefits.
Kerry in Australia
Kerry place in this Australian food and beverage landscape is substantiated by a continued emphasis on their fundamental target markets, while branching out into emerging categories that are more focused on health.
“For Kerry, revenue growth in our business across Australia and New Zealand over the coming years will come from a focus on our core end use markets of Meat, Beverage and Savoury and emerging categories such as Supplements & Functional Food and Beverages and Plant-Based Food & Beverages,” Cahalane said.
According to Food Innovation Australia Limited (FIAL), one of the major challenges identified for the food and beverage industry is the ability for businesses to easily adapt and respond to rapidly evolving consumer needs, and changing business and market conditions. The Department of Agriculture and Fisheries has also identified nutritional value, addressing customer demand, and agile supply chains as major drivers in the sector.
By establishing the Development and Application Centre in Brisbane last May, Kerry Australia and New Zealand is both facilitating access to the global market for local suppliers and following Kerry’s globally recognised innovation strategy. This strategy is centred on creating value for the consumer, which reflects the industry’s changing needs and can unlock opportunities for growth in Australia.
According to Kerry research, consumers in all markets want better taste, and more authentic, natural and local experiences. They want enhanced nutrition for better health and overall well-being and more convenient and affordable options to match modern on-the-go lifestyles. To top it off, sustainability is important: consumers want products that are made with cleaner labels and natural, easily recognisable ingredients, transparency, and more responsible sourcing of those ingredients.
This has put significant pressure on manufacturers, food service companies, restaurants and other end-use suppliers who want a partner that can not only help them meet consumer demands now, but also predict new upcoming trends.
“Our sustainability strategy, Beyond the Horizon, supports Kerry’s ambition to reach over two billion people with sustainable nutrition solutions by 2030,” Cahalane said. “Through Kerry’s holistic support, deep innovation expertise and our extensive solutions portfolio covering food safety and security, clean label, positive and balanced nutrition, proactive nutrition and personalised nutrition, we help our customers move along the Sustainable Nutrition spectrum to produce healthier, nutritious products that satisfy consumer demands, feed a growing population and are better for people, society and the planet.”
More than 80 per cent of Kerry Ingredients’ portfolio delivers balanced and positive nutrition to one billion consumers around the world. Their integrated solutions are applied across a taste and nutrition strategic framework that is focused on:
- Authentic taste;
- Preservation and food protection; and
- Health and bio-pharma.
“At Kerry Australia, we locally manufacture and supply our sustainable nutrition solutions for Australia, New Zealand and Asia-Pacific through our robust network of manufacturing sites and distribution centres,” Cahalane said. “Being able to bring together the breadth of Kerry technologies under one roof is key to improving our speed to market and our agility to meet customers’ needs.”
On opening their Australia and New Zealand Development and Application Centre in Brisbane, Kerry supports over 100 local and regional food manufacturers to conduct intensive R&D projects via the onsite New Product Development facilities, with lab testing, sensory market analysis and manufacturing pilot lines.
This greatly reduces the innovation cycle and the requirements for customers to run trials within their own manufacturing facilities, thereby improving their efficiency and ability to meet tight timelines to launch new products.
“After a difficult year for Australian food suppliers, improving supply chain access and providing support to manufacturers to innovate are essential for their recovery,” Cahalane said. “Customers can take advantage of Kerry’s research and development global network which will provide access to global insights, market knowledge and culinary expertise, helping them develop solutions and products that are popular with and appeal to the local market.”
In July 2021, Kerry Ingredients also expanded their ProActive Health portfolio through the acquisition of the Spanish biotech company, Biosearch Life. This added three new branded technologies to the portfolio, including:
- Hereditum – a range of premium probiotics that are isolated from human breast milk and suitable for use in infant nutrition, functional foods, and dietary supplements;
- Eupoly-3 – a range of ultra-purified Omega-3 fish oils with a very clean taste profile specifically developed for dairy, infant formulas, and functional foods and beverages; and
- Exxentia – a range of over 250 botanical extracts, including several branded extract ingredients that support joint, heart and women’s health.
“With consumers in Australia taking a more proactive approach to health, and by integrating these technologies into our ProActive Health portfolio, we can be our customers’ most valued partner in creating healthier, sustainable food and beverages Australian consumers want,” Cahalane said.
Kerry also acquired Niacet in September 2021, which Cahalane says is a global leader in preservation.
“APMEA faces food production challenges due to climate change and longer supply chains, driven by demographic changes and rapid urbanisation,” he said. “Niacet has a clear leadership position in bakery and has cost-effective low-sodium preservation systems for meat and plant-based food.”
By adding Niacet technologies to their clean label food protection and preservation technologies portfolio, Kerry can strengthen their position with complementary technologies while accelerating their growth.
“We will build upon the commercial reach of Niacet’s brands by adding the breadth and depth of our global network, innovation and application centres of excellence, as well as our taste and nutrition expertise,” Cahalane said.
“This means we can help customers in Australia and the region get products to consumers safely and over wider areas of distribution with less waste of valuable food resources and higher levels of food safety.”
More recently, Kerry completed the acquisition of US-based Natreon, a supplier of branded ayurvedic botanical ingredients. Natreon supplies branded and scientifically studied and tested ayurvedic extracts to the dietary supplement and functional food and beverage industries worldwide.
“This latest acquisition significantly expands our leadership position and Proactive Health portfolio of science-backed branded ingredients, furthering Kerry’s technology growth,” Cahalane said.
“We are always interested in working with potential partners and companies to build and strengthen our portfolio in realising our vision of Sustainable Nutrition, regardless of where they are located.”