Shaun Paul, Research Fellow
Global Development And Environment Institute
at Tufts University
November 6, 2013
• Defining superfoods
• Consumer and industry trends
• An example of Chia
• Role of supply chains in shaping sustainabilit...
what is a superfood?
The Oxford English Dictionary defines a superfood as

“any food considered especially nutritious or
o...
Superfoods in the Market T
oday

quinoa
quinoa

chia seeds

açaí berries

goji berries

Over 100 foods marketed as superfo...
Just Marketing?
“From a nutritionist’s point of view, the idea is
totally silly. Superfoods are about marketing, not
nutri...
Drivers of Growth in Consumer Demand:

Health and Wellness
8 in 10 Americans are making some or a lot of effort to
eat hea...
Other Drivers of Consumer Demand
Naturally Healthy
Shift away from engineered food in the form of reduced fat and lower
so...
How Large is the Superfood Market?
Estimates vary widely and fall within recognized Health &
Wellness food categories.

Eu...
:

Nine leading “superfoods”
$399 million in 2012

Products containing blueberry and coconut oil
grew 274% and 103%, respe...
Permanent Crops Offer Better Returns
Than Row Crops in the US

Source: NCREIF | National Council of Real Estate Investment...
The Example of Chia
Background
• Salvia hispanica
• Flowering annual crop in the mint family
• Indigenous to southwestern ...
Chia’s Nutritional Benefits
Ingredient Versatility and Market

Chia can be sold raw, in bakery products,
pasta, and snacks, or as an ingredient added
...
Chia Challenges to Growth
• Demand currently outpaces supply
• Chia is more expensive than a similar f lax
seed
• Continue...
Potential Chia Cultivation

Optimal within 15° of the equator. However recent supply shortages have spurred
cultivation in...
Developing Chia Sustainably
• T
apping into overlap between consumer demand for
sustainably sourced agriculture and “super...
Supply Chains Key to Sustainability

• Improve conventional supply chains for risk
management that enhances social and env...
Conventional risk management
places greatest burden on growers
Direct Trade Alternative: Sustainable Harvest

Sustainable Harvest: 3-year growth 292%, 2011 Revenue $78M
Expanding Direct
Trade for Chia

• Sells organic ‚ancestral
superfoods‛
• 4 ingredients: chia, hemp seed,
coconut, red pal...
Reintroducing Chia to Guatemala
with Direct Trade
Questions?

Shaun Paul, shaun.paul@tufts.edu
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Investing in superfoods: Sustainable Solution or Passing Fad?

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Presentation on the emerging trends of superfoods in health and wellness consumer product foods with considerations for building sustainable international agricultural supply chains using the examples of coffee and chia.

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  • The link between diet and health has been long known: in 400 B.C. Hippocrates said “Let food be thy medicine and medicine be thy food”The premise of superfoods is that they provide something “beyond basic nutrition” These foods must demonstrate their health effects in amounts that can normally be expected to be consumed in a diet.Health claims have been based on the content of certain vitamins, minerals, antioxidants, omega-3 fatty acids, fiber, probiotics, or phytochemicals (e.g. polyphenols and flavonoids)which recent and expansive medical research have linked to an improved state of health and well-being and/or reduction of risk of disease.Research has tied some of these biologically active compounds to reduced risk of chronic diseases such as diabetes, cancer, cardiovascular diseases and respiratory diseases.Nutrient density - The measurement of how much of any particular nutrient the food contains in regards to how much is in one serving.Nutrient diversity - The measurement of how many different nutrients are available in this one food.Phytonutrient content - The amount of healthy chemical compounds, known and unknown, that exist in plants. There are potentially thousands of phytonutrients in plants and any superfood should be a known source.Toxin absence - The goal of consuming superfoods is to load the body with as many nutrients as possible. Superfoods should represent clean, hormone-free, chemical and pesticide-free sources of nutritionLearn more: http://www.naturalnews.com/038324_food_superfood_nutritional_density.html#ixzz2jhqgaBBy
  • Someeveryday foods that have been called superfoods include beans, blueberries, tomatoes, certain fish, citrus, whole grains, sweet potatoes, eggs, nuts, dark leafy greens, and yogurtThere has also been an explosion of many exotic superfoods including turmeric, mangosteens, kefir, coconut oil, lingonberries
  • There is no official standard for superfood labeling and in much of the world (US, Japan, Canada, Australia and New Zealand) the “superfood” marketing claims are unregulated. However in the European Union, a “superfood” must now meet at least one specific medical claim supported by credible scientific research
  • There has been “a shift away from engineered health in the form of reduced fat and lower sodium, and a focus on new items that are simply naturally better, whether through ingrained nutritional properties or other health-related benefits.”In this way, the new definition of “healthy” is about adding rather than subtracting—consumers want to eat meals they can feel good about consuming, rather than those that are simply diet friendly or “guilt-free”.http://www.portal.euromonitor.com.ezproxy.library.tufts.edu/Portal/Pages/Search/SearchResultsList.aspxfamiliarity and price can both provide barriers between consumer intention and consumption
  • There has been “a shift away from engineered health in the form of reduced fat and lower sodium, and a focus on new items that are simply naturally better, whether through ingrained nutritional properties or other health-related benefits.”In this way, the new definition of “healthy” is about adding rather than subtracting—consumers want to eat meals they can feel good about consuming, rather than those that are simply diet friendly or “guilt-free”.http://www.portal.euromonitor.com.ezproxy.library.tufts.edu/Portal/Pages/Search/SearchResultsList.aspxfamiliarity and price can both provide barriers between consumer intention and consumption
  • http://www.motherjones.com/documents/627759-spins-data
  • Chia’s biggest claim to fame in the health world is its extremely high concentration of omega-3 fatty acids which have been shown to be beneficial in preventing the onset of cardiovascular disease, inflammation, developmental disorders, psychiatric disorders and cognitive aging. Chia is also vegan and gluten-free.
  • Sales of omega-3 in the packaged format (inclusive of supplements, food and drink) were estimated at US$30 billionin 2012. In 2012,Omega-3 fatty acids (from fish and non-fish sources) were the fastest growing supplements from 2007-2012 with a 15.6% CAGR.Awareness (backed by growing scientific research) has grown that a lack of omega-3 is detrimental to the functioning of the brain, eyes and heart. And government’s have claimed there is a significant gap between actual intake and recommended daily intake levels. http://www.portal.euromonitor.com/Portal/Handlers/accessPDF.ashx/Success_of_Omega_Fatty_Acids_From_Supplements_to_Food.pdf?c=10\PDF\&f=F-233852-23815010.pdf&saveAsName=Success_of_Omega_Fatty_Acids_From_Supplements_to_Food&code=88FlfnNiRPtObORXzUoUvg0NTc4%3dGlobally, gluten-free food made value gains of 24% between 2010 and 2012, which is double the growth registered by overall health and wellness foods and beverages. In North America in 2012, gluten-free food value sales increased by 15% compared to health and wellness products’ rather sluggish growth of 2%.http://www.portal.euromonitor.com/Portal/Pages/Common/Pdf.aspx/Chia_on_its_Way_to_Becoming_the_New_FlaxSales of NH beverages grew by 42% in value over the 2007-2012 period, to US$188.9 billion, while NH packaged foods achieved value growth of 30% to reach sales of US$98.6 billion. http://www.portal.euromonitor.com/Portal/Handlers/accessPDF.ashx/10_Global_Consumer_Trends_for_the_Next_Five_Years.pdf?c=46\PDF\&f=F-218503-22392946.pdf&saveAsName=10_Global_Consumer_Trends_for_the_Next_Five_Years&code=OBRxqhYBXNJqBa4eD%2fBPtRvQ3V0%3d
  • Supply bottleneck is due to geographic requirements of cultivation and calamitous weather conditions in 2012 that decimated harvest yields in Argentina, Paraguay, Peru and Ecuador
  • Dates back to 3500 BC, discouraged by conquistadorsNeed for stability in supply65% of industry respondents believe that the same kind of consumers are interested in sustainable foods as superfoodshttp://www.prnewswire.com/news-releases/reportlinker-adds-growth-opportunities-in-sustainable-and-positive-health-food-and-drinks-key-innovations-leading-company-strategies-and-how-to-benefit-from-overlap-of-ethical-and-superfoods-overlap-104356993.html
  • Possible cut this slide and just use following slide to illustrate intl agricultural value chain
  • https://mapsengine.google.com/map/edit?mid=zk-DkfHudNfw.kylyZcSfocjs
  • Investing in superfoods: Sustainable Solution or Passing Fad?

    1. 1. Shaun Paul, Research Fellow Global Development And Environment Institute at Tufts University November 6, 2013
    2. 2. • Defining superfoods • Consumer and industry trends • An example of Chia • Role of supply chains in shaping sustainability
    3. 3. what is a superfood? The Oxford English Dictionary defines a superfood as “any food considered especially nutritious or otherwise beneficial to health and well-being” Attributes: •Nutrient dense •Nutrient diverse •Phytonutrient content •Toxin absence
    4. 4. Superfoods in the Market T oday quinoa quinoa chia seeds açaí berries goji berries Over 100 foods marketed as superfoods by 2007
    5. 5. Just Marketing? “From a nutritionist’s point of view, the idea is totally silly. Superfoods are about marketing, not nutrition.” - Marion Nestle, Professor in the Department of Nutrition, Food Studies, and Public Health and Professor of Sociology at New Y University ork
    6. 6. Drivers of Growth in Consumer Demand: Health and Wellness 8 in 10 Americans are making some or a lot of effort to eat healthfully (Food Marketing Institute, 201 1) Nearly 9 in 10 grocery shoppers (88%) believe it is very important to get their nutrients from foods naturally rich in vitamins and minerals (HealthFocus, 2010)
    7. 7. Other Drivers of Consumer Demand Naturally Healthy Shift away from engineered food in the form of reduced fat and lower sodium, and toward simply better naturally Aspirational Consumers Seek both sustainability and consumption and look for brands to provide solutions that both improve their lives and serve the larger society. 65% of consumers surveyed in 2012 in developed and emerging markets feel a sense of responsibility to purchase products that are good for the environment and society. (RE:THINKING CONSUMPTION, 2012) Rising Disposable Income in Emerging Markets In 2010, the emerging markets, led by China and India, accounted for $12 trillion in spending. In 2025, they are expected to account for about $30 trillion, or nearly half of all global spending (McKinsey Global Institute)
    8. 8. How Large is the Superfood Market? Estimates vary widely and fall within recognized Health & Wellness food categories. Euromonitor International 2012 Superfoods could fit under any of these categories depending on how they are grown, incorporated into products, and marketed.
    9. 9. : Nine leading “superfoods” $399 million in 2012 Products containing blueberry and coconut oil grew 274% and 103%, respectively Data from SPINS, a natural foods and supplements market research firm on combined sales of products tracking primary ingredients in natural and conventional supermarkets
    10. 10. Permanent Crops Offer Better Returns Than Row Crops in the US Source: NCREIF | National Council of Real Estate Investment Fiduciaries, Equilibrium Capital Group
    11. 11. The Example of Chia Background • Salvia hispanica • Flowering annual crop in the mint family • Indigenous to southwestern Mexico and northwestern Central America • Pre-Columbian staple food cultivated since 3500 BC • Dramatic recent growth of international demand • T oday, Latin American farmers are reaping up to 350% annual return on investment
    12. 12. Chia’s Nutritional Benefits
    13. 13. Ingredient Versatility and Market Chia can be sold raw, in bakery products, pasta, and snacks, or as an ingredient added to yogurt, beverages and other products.
    14. 14. Chia Challenges to Growth • Demand currently outpaces supply • Chia is more expensive than a similar f lax seed • Continued growth in global demand expected • Deceptive and unregulated marketing can result in baseless health claims
    15. 15. Potential Chia Cultivation Optimal within 15° of the equator. However recent supply shortages have spurred cultivation in Australia (now a major exporter) and the Southern US
    16. 16. Developing Chia Sustainably • T apping into overlap between consumer demand for sustainably sourced agriculture and “superfoods” • Establishing transparency and quality assurance • Expanding and diversifying supply chains with cooperatives and small farms
    17. 17. Supply Chains Key to Sustainability • Improve conventional supply chains for risk management that enhances social and environmental sustainability
    18. 18. Conventional risk management places greatest burden on growers
    19. 19. Direct Trade Alternative: Sustainable Harvest Sustainable Harvest: 3-year growth 292%, 2011 Revenue $78M
    20. 20. Expanding Direct Trade for Chia • Sells organic ‚ancestral superfoods‛ • 4 ingredients: chia, hemp seed, coconut, red palm oil • $50 million in 2012 sales • 50% annual growth for past 5 years only recently ‘breaking even’ • Seeking to move from conventional sourcing to long-term direct relations with farmers
    21. 21. Reintroducing Chia to Guatemala with Direct Trade
    22. 22. Questions? Shaun Paul, shaun.paul@tufts.edu

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