Oakey Beef to install green energy storage orb

Oakey Beef will extract green energy biogas (methane) from its waste water streams to replace natural gas currently consumed at the abattoir.

The 6000m3 capacity storage tank will collect biogas produced by the new Global Water Engineering COHRAL Covered High Rate Anaerobic Lagoon at Oakey Beef Exports on Queensland’s Darling Downs.

The 26m high flexible storage tank – one of the world’s largest of its type – features resilient flexible double membrane storage so that gas produced by the COHRAL plant can be safely stored separately from the gas generator.

Use of the separate flexible tank for gas storage provides security against leakage, with gas securely contained in the tank instead of being more loosely contained under lagoon covers.

The Sattler biogas storage design selected for Oakey Beef has been tested and proven over decades and now is an integral feature in the design of modern waste water treatment plants worldwide. They are engineered to be permanently gas-tight with high operational reliability and optimum safety.

“The safe, durable and environmentally harmonious COHRAL technology deployed at Oakey Beef can be widely applied worldwide to food, beverage and agricultural and primary processing plants,” said CST Wastewater Solutions Managing Director, Michael Bambridge, whose company represents the GWE COHRAL technology in Australia and New Zealand.

“Oakey Beef Processing and its owners Nippon Meat Packers have taken a far-sighted initiative that opens the way to cleaner, greener and more profitable industry performance.”

The COHRAL plant is expected to repay its cost of construction inside five years through gas purchase savings amounting to many millions of dollars – then continue to deliver benefits and profitability virtually in perpetuity, said Oakey Beef Exports Pty Ltd General Manager, Pat Gleeson.

In addition to lowering the plant’s dependence on increasingly expensive supplies of natural gas, the Global Water Engineering anaerobic digestion plant will simultaneously reduce the plant’s carbon footprint and produce waste water far cleaner than typical waste lagoons.

COHRAL technology – which is applicable to both livestock and cropping operations – uses concentrated anaerobic bacteria to digest 70 per cent of the organic matter (COD, or Chemical Oxygen demand) in Oakey Beef Exports’ waste water to produce effluent of far high quality than typical open lagoons.

Bambridge said Oakey’s initiative sets an outstanding precedent for agribusiness in Australia because the cost-effective technology can turn an environmental problem into profit by simultaneously enhancing water quality and lowering fuel bills.

“It also helps companies such as Oakey to guard against future price rises in the cost of energy and possible future imposts such as a carbon tax,” Bambridge said.


Coca-Cola to enter functional milk market with Fairlife

The Coca-Cola Company has announced that it will be entering the US milk market.

The global beverage giant announced at the Morgan Stanley Global Consumer Conference that its new “Fairlife” product will be launched in stores in late December.

Sandy Douglas, global chief customer officer and president, Coca-Cola North America said that the company has decided to take “a very significant place in milk,” and that its new product is made on a sustainable dairy using a proprietary milk filtering process that can increase protein by 50 percent, reduces sugar by 30 percent and omit lactose.

“The test markets have been amazing, and we’ve created a joint venture with a bunch of dairy farmers who are innovative leaders in the dairy industry. So you put that next to Simply and you have a nutrition beverage company with tremendous growth potential,” Douglas told the conference.

“Now to be clear, we’re going to be investing in the milk business for a while to build the brand so it won’t rain money in the early couple of years. But like Simply, when you do it well it rains money later. And we can deliver with our business portfolio before the milk comes on full profit line.”

Lianne Van Den Bos, analyst from global market research company, Euromonitor says that Fairlife is the “epitome of on-trend”. She says that the product is twice the protein and calcium compared to full fat milk, half the sugar, lactose-free, sustainably produced and packaged in recyclable bottles.  

“Looking at the categories in which Coca-Cola has a presence in North America, two thirds of its sales come from carbonates and juices, which have been underperforming as consumers cut down on sugary drinks. As such, over the years Coca-Cola has moved into sport drinks, reduced calorie options such as Coca-Cola Life and now milk is its next step,” she says.

“In fact when looking at similar products that are positioned around high protein, lactose-free, and low-calorie, sales have been booming in North America as US consumers have flocked towards products which promise satiety or alternative, lactose-free products, as some studies suggest that lactose can be linked to digestive problems. Non-dairy milk alternatives, yoghurt and fortified flavoured milk have all show strong growth rates, with CAGRs above 5 percent over 2009-2014, yet Coca-Cola’s presence in these categories is negligible, whilst its presence in stagnant categories such as juices and carbonates is high.”

Van Den Bos says that Coca-Cola could be successful in launching Fairlife considering the demand for products with high nutritional credentials, however the company’s current marketing campaigns are heavily focused on being “being better, bigger and more natural than competing products”.

Van Den Bos suggests that marketing modesty instead may help in convincing the consumer to believe in the purity of the product.

“In terms of turning niche into mass, there is a danger that the high number of product launches claiming increased levels of protein at the moment will turn a unique selling point of today into the industry norm of tomorrow and therefore lose its edge,” she says.

Functional and fortified milk in Australia

Daniel Grimsey, analyst at Euromonitor Australia says that despite declining since 2012, the Australian per capita retail volumes of milk have remained more or less stable, with a three precent compound annual growth rate during 2009-14.

According to data from Euromonitor, Australia is currently ranked 6th globally for per capita milk retail volumes, at 75 litres per head in 2014.

"Across the dairy Australian dairy industry as a whole, there has been a much stronger performance of lactose-free dairy than in the US, with a compound annual growth rate of 17 percent  (or a 118 percent entire increase from 2009 to 2014). Reduced fat milk has also registered a stronger performance in Australia," says Grimsey.

Grimsey says that organic milk has performed well across both markets, however fortified/ functional (FF) milk has not performed particularly well in either market over the period, and Fairlife, with claims such as 50 percent more protein and 50 percent more calcium, would most certainly fall into the FF category.

Euromonitor Australia say that Coca-Cola could be successful revitalising the struggling category in the US, however the company has no intention of launching Fairlife in Australia at this stage. 

Researchers develop new coating for cheese

Researchers from the Universitat Politècnica de València (UPV) have developed new edible coatings for soft cheeses.

The coatings incorporate oregano and rosemary essential oils as antimicrobial agents to increase the lifespan of the products as well as chitosan, a by-product originating from crustacean shells.

Chelo González, researcher at the Institute of Food Engineering for Development of at UPV, says that the new edible coatings provide an alternative to coatings such as pimaricin and polyvinyl which are commonly used on commercial cheese.

"The product that we have obtained is an alternative to the use of pimaricin and non-edible plastics,” says González . “Moreover, using a natural and edible product reduces the fungal problems and controls the weight loss during the maturing.”

In addition, González says that the film may be able to decrease the growth of fungus on the surface of the cheese during the maturing process.

"In this case, applying the coatings that we have developed will reduce the proportion of product losses in the cheese factories and therefore the important economic losses that this implies,” he said.


Newtown Growler Depot offers world first for craft beer lovers

Located within Sydney's Newtown Wine Shop, the Newtown Growler Depot is now home to Rosie, a custom built machine capable of cleaning, sanitising and filling growler bottles.

Sam Taylor, founder of the Newtown Growler Depot and organiser of the Sydney Craft Beer and Cider Festival for the past three years says that Rosie is a world first, and that no other machine is currently capable of sanitising and pressure filling the re-useable growler vessels.

“Growlers are two litre glass bottles that are immensely popular amongst micro brewers and in the craft beer world, particularly overseas,” says Taylor.

“Traditionally, growlers are filled directly from a tap, which means that the beer must be consumed within hours of purchase.  Then there is the problem of reusing bottles and keeping them clean.  This is where Rosie comes into her own – no other machine is capable of sanitising and pressure filling growlers – which ensures that the beer stays great for weeks, and also enables a swap and go service.”

Taylor says that Rosie is effectively like visiting five mircobreweries at once. Rosie is connected to up to 12 kegs at any one time and all kegs are delivered direct from the brewery, and kept under cold storage in a cool room next to the innovative machine.

The Newtown Growler Depot currently features beers from Young Henrys, Batch Brewing, Shenanigans, Dennis, Grifter, Willie the Boatman and Little Creatures.


FSANZ to review raw cheese ban

Food Standards Australia and New Zealand (FSANZ) is currently reviewing legislation surrounding the use of raw milk in soft cheese.

Under current legislation, most cheese must be made from pasteurised milk to ensure that harmful bacteria such as listeria and salmonella are killed, however many cheesemakers and chefs argue that pasteurisation compromises on the flavour of the final product.

Celebrity chef Pete Evans is highly supportive of a change to the legislation, arguing that other popular food items are far more dangerous than raw milk.

"Raw milk products like cheese, fresh cheese in particular if you make it at home, is far more dangerous than stuff you would buy in a shop or stuff you would make from pasteurised milk," Evans told ABC News.

"But it's much less dangerous than things like oysters or seafood, it's much less dangerous than chicken or eggs, and we don't stop people from buying raw oysters or buying raw eggs and trusting them to know what to do with it."

FSANZ has received a number of submissions on the proposed changes and is expected to hand down a final decision in December this year.

Submissions from both industry and consumers were called earlier in the year with FSANZ chief executive officer, Steve McCutcheon saying at the time that cheeses made with raw milk may be produced under the proposed legislation providing the “stringent requirements in the Code are met”.

“These include additional animal health, milking hygiene and temperature control requirements.

“Businesses would have to demonstrate to enforcement agencies that they are able to meet the requirements,” said McCutcheon.

Bonsoy settles for $25m and Oceanwatch introduces QR codes [VIDEO]


This week in food manufacturing news Bonsoy has agreed to a $25m compensation deal with nearly 500 victims after the company's soy milk was found to have unsafe levels of iodine.

Elsewhere, OceanWatch Australia has announced a first for the Australian fishing industry with the introduction of QR codes for fresh seafood designed to provide wholesale buyers with a complete picture of where, how, and by who the catch was caught.


Compulsory egg stamping introduced in NSW

Eggs produced in NSW must now be stamped with a unique identifying mark to improve traceability.

Minister Katrina Hodgkinson says that the measure has been put in place as part of a new national standard that is designed to reduce the impact of potential future food poisoning outbreaks.

Hodgkinson said that the industry has been widely compliant in adopting the new requirements as producers see the value in protecting their customers and improving traceability.

"Egg stamping will mean that the source of an outbreak will be more easily traced and contained," said Hodgkinson.

"Eggs are a leading source of Salmonella – between 2010 and 2014 in NSW there were 40 food poisoning outbreaks associated with eggs, affecting more than 700 people, with many requiring hospitalisation.”

In order to help smaller businesses comply with the new requirements, the NSW Liberals & Nationals Government has provided free stamps to small businesses producing less than 1000 eggs a day.

Hodgkinson’s notes that the state government has introduced a few exemptions for operators that produce less than 20 dozen eggs a week, and also for those that sell eggs direct from the farm gate.

“For the most part, from today people should only buy eggs that have the unique stamp on the shell,” she says.

"We recognise that there will be a transitional period where there may still be unstamped product in the market and the NSW Food Authority will be monitoring compliance with this requirement from 26 November.”

A recent study from the Australian National University found that while overall cases of foodborne illness has declined slightly, cases involving Salmonella and Campylobacter have increased.

Between 2000 and 2010, the number of foodborne illnesses fell by 17 percent, however the number of recorded Salmonella cases increased by 24 percent.


SMBs should challenge suppliers to achieve growth, Forum Group

According to a new report from managed-service company, Forum Group, two in five SMEs have either decreased the number of sites they operate across or let staff go to manage supplier cost fluctuation.

The Forum Group surveyed 453 businesses to examine and quantify how the operational expenditure of SMEs, and mid-market companies impacts on business growth and productivity.

The report found that 66 percent of respondents have seen employee head count restricted, or profit margins decrease due to the impact of increased operating expenditure.

“It is worrying that such a large number of organisations feel they need to resort to redundancies to get a handle on hard costs,” said Forum CEO, Bill Papas. “We know cost of doing business is increasing, and the strain this is putting on business, particularly SMEs, means companies need to look for new ways to make the most of their operating expenditure to better manage inefficiencies.”

The report states that over the past 12 months, only 20 percent of operators have actively looked at ways to reduce their largest operating expenditure, which is only down slightly from 22 percent three years ago.

In addition, 30 percent of respondents said they have increased the number of suppliers servicing their organisation over the last year, and that more than half (60 percent) of businesses claim they can’t change suppliers due to existing contracts and penalty fees, or personal relationships.

Papas said rising costs and operational issues can often distract business owners and managers from their core business.

“The costs associated with managing multiple supplier arrangements is often overlooked and most business owners and managers don’t have the time or knowledge to identify the best services or suppliers, or how to better manage the increasing cost of doing business. They may search online for a quick fix, or perhaps look to their own network and suddenly find themselves in a situation where they have too many suppliers to handle,” he said.

“SMBs should challenge their suppliers to improve and streamline their services so they can prioritise business productivity and growth.”

Other findings from the research include:

  • 14 percent of SMBs have up to 10 suppliers
  • 56 percent of SMBs review their supplier contracts annually
  • 5 percent of SMBs are not clear on why their supplier costs have changed over the last three years


Sustainable chocolate key to lucrative mid-lifer market, Canadean

A new report from Canadean has found that chocolate is becoming increasingly popular among consumers aged 35-44, and that the key to capitalising on this trend is to promote chocolate as an indulgent treat with natural ingredients and sustainable production methods.

Canadean's survey finds that 46 percent of consumers aged 35-44 claim that ‘natural products’ are neither important nor unimportant when they look for chocolate. Moreover, 66 percent have never put a confectionery product back on the shelf because it was not natural enough.

In addition only 20 percent of respondents believe that confectionery is artificial, meaning that the majority of consumers see chocolate as a natural product. In order to emphasise the often overlooked natural positioning of chocolate and its ‘better for you and the world’ credentials, Canadean say that marketers need to establish a link between concepts such as ‘natural’ and ‘sustainable’.

“Chocolate can be positioned both as an indulgent treat and a ‘good’ product,” says Raquel Perez-Lopez, analyst at Canadean. “This can be done by positioning a product around the claim of ‘creating a better and sustainable world’. Moreover, appropriate labelling, such as Fairtrade certification, would allow consumers to enjoy a guilt-free moment of indulgence by eating a product that has been produced in an ethical and environmentally friendly manner.”


Concentrated quality – interview with Hank’s Jam

Hank’s Jam is a Sydney centric brand that is synonymous with quality. With humble beginnings in a Sydney kitchen over 20 years ago, the brand has grown substantially, yet managed to maintain its cottage industry processes and ethos.

Food magazine recently caught up with general manager of Hank’s Jam, Bernie Rorke to chat about the company’s journey over the years, including signing a deal with Woolworths, and exporting to the UAE and China.

The story of Hank’s Jam began when Hank, a young Danish chef working in a restaurant in Darlinghurst, started to make marmalade. It wasn’t long before word of mouth started to spread, resulting in the brand creating somewhat of a cult following. Over time, demand increased so dramatically that Hank quit his job as a chef and started to make the jam full time, the only thing was that Hank really had no intention of creating a business.

“It got to the stage where it started to get bigger then he really wanted,” said Rorke. “My partner Chris was running a number of cafes and he used to sell Hank’s Jams because he loved the product. Basically Hank came in one day to deliver the products and sort of said that he wasn’t enjoying cooking it anymore, and didn’t want anything to do with the business. So from there, Chris decided to buy the Hank’s business.”

From there, Rorke says that he and his business partner decided to keep the same cooking methods that Hank used which involved slow reduction cooking, but on a larger scale to satisfy commercial demand.  

“It’s still the same methods,” says Rorke. “We’ve just automated the jarring. So in essence we are still creating that same product with the care and love that Hank put into it.”

Slow reduction cooking

The traditional method that Rorke refers to involves reduction cooking using all natural products, and no preservatives.

“We have to cook it down to a particular rich level, because otherwise, we would get mould in the jam. If we were just trying to get the highest yield, we would just reduce it slightly and put preservatives in it which is what stops the mould forming. We also put the highest amount of fruit when compared to other commercial jam manufacturers, and that combined with the reduction cooking method, and all natural ingredients, gives us the flavour that we have built our reputation on.”

The main distribution avenues for Hank’s up until recently have been solely cafes and independent retailers. It’s only been recently that the products have been available in Woolworths – a decision that Rorke says involved two years of persistence on the retailer’s behalf.

“What happened was that like any business, we got to the stage that we had to look at the commercial viability of the business. We really wanted to keep the cottage industry feel with our product but about three years ago, Woolworths approached us. They were doing a promotion for Australian Made and local produce and wanted to get the Hank’s brand involved. Chris tossed and turned about it and for two years he kept saying no. Saying that it’s not where he wanted the brand to be but then the commercial realities kind of set in.”

From there, the company made an interesting decision. They decided to sell three of the Hank’s products with a slightly different label to Woolworths.

“We received a bit of flak from our followers at the start but, 90 percent of our products are still going out through independent retailers and word of mouth through cafes so the vast majority of our business is still back to that traditional channel,” says Rorke. “It was a really tough decision to make and I mean we did cop a bit of flak at the start, but it’s started to settle now.

“Rightly or wrongly, we are actually in the process of bringing our packaging back into its original retro style, the only real addition being a coloured tab that differentiates the flavours. When we went away from the original design to the different labels for the Woolworths products, we found that it created a lot of confusion for our customers, so we’ve bought it back to our grass roots I suppose.”

Exporting Hank’s to the world

Exports wise, Rorke says that Dubai has served the company particularly well. Hank’s started importing its miniature 28gm breakfast jars to hotels and serving them inflight on Qantas first and business class.

“We invested in creating the smaller jars for the hotels and airlines because in reality, there was only one other player in the market doing it in Australia and they were a lower end jam, and Qantas and a lot of five star hotels were looking for a more premium product,” says Rorke.

In addition to the single serve jars, Hank’s are also exporting its 285gm retail sized jars to Dubai and more recently to China and the US.

“At the moment we have had good positive feedback so we are just going to wait and see as to whether that takes off. We’ve been in Dubai for about six months and they have had about two or three orders. We are also just breaking into a couple of the airlines over there as well as the five star hotels.

China however wasn’t quite as smooth sailing as Dubai.

“We’ve got a good distributor [in Dubai], but it’s a lot of learning by mistakes too,” says Rorke. “For example with China we’ve had some major challenges relating to getting product cleared through customs – it was a bit of a nightmare but we finally got it through, and it cost a lot more than we expected. But I think the initial hurdle of getting it in there was the hard part.”

The demand for quality

In addition to the airlines and premium hotel market, Rorke says that Hank’s original key distribution channel – foodservice – remains to be one of the brands most loyal, especially with the increased demand for artesian bread.

“One of the biggest drivers of jam has been the increase in good quality bread. If people are going to make the decision to buy good quality bread, then they want a good quality jam as well to put on it,” says Rorke.”Cafes in general have really upped the ante in the quality of their food offering, they see it as their big point of difference. Cafes have always been a centre piece to Hank’s. We have found cafes to be the ones to really take to our products and influence people to go out and buy it in retailers.”

When it comes to new flavours and innovations, Rorke says that the brand has launched a number of new additions including a tomato sauce, strawberry and rhubarb jam and new ‘exotic’ lines including fig and cinnamon jam, and pawpaw and passionfruit jam. But there are two lines that have been outstanding star performers.

“One of our products that has grown dramatically is the pear and vanilla jam because pear is the only fruit that doesn’t have allergies. The product is also the only jam that’s listed on the RPA elimination diet handbook,” says Rorke. “But our biggest mover, and our fastest mover has been our chutneys.

“We find that chefs – the trained palette – just love the chutneys because they love testing their palate. So they’ll sit there and ponder the flavour and try and guess what’s in it.

“Chefs are under a lot of pressure to add flavour to the meals that they make all the time, so if they can get a chutney that works well, they love it. The foodservice sector really has been a big door opener for us.”

Although foodservice is still the main bread winner for the brand, Rorke says that the retail sector is continuing to gain momentum, especially as people look for quality over quality.

“The premium jam sector is the one that’s growing the most in the retail sector because people are really demanding quality. The lower sugar jams have declined enormously because people want a quality product. People are not eating jam for health, they are eating it for flavour.”


Euromonitor releases new report on the ‘global sugar backlash’

Euromonitor International has released a new report discussing the global backlash against sugar.

The report discusses changes in consumer attitudes towards sugar and the effect sugar is having on global markets.

Each of the 34 global markets identified in the report saw a five-year rise in obesity including the US, where the number of obese adults rose from 34 percent in 2008, to 41 percent in 2013. In addition 27 markets saw an increase in diabetes.

Euromonitor notes that the negative attitude towards sugar is driving changes in trends, with consumers either making a conscious effort to reduce their intake, or eliminate it completely.

Accordng to findings in Euromonitor’s Global Consumer Trends Survey, 42 percent of consumers are now seeking out food labels with limited or no added sugar.

“Sugar is now seen as a health risk by most, and as toxic as tobacco by some,” says Gina Westbrook, director of strategy briefings at Euromonitor International. “Sugar has endured a tide of negative public opinion as the amount of scientific research linking the rise in sugar intake with obesity has increased, leading the government to become increasingly concerned about the rising cost of illnesses such as diabetes and cancer.”

Westbrook notes that the World Health Organisation (WHO) recently recommended cutting the daily sugar limit in half to five percent and that manufacturers will need to reduce sugar content and continue to develop natural alternatives to artificial sweeteners.

“Companies will continue to work with ingredients suppliers to develop new alternatives, with natural sweeteners like stevia holding the greatest growth potential,” she said.

In November last year, Mexico passed a law that imposes significant new taxes on sugary drinks and junk food.

President Enrique Peña Nieto, successfully passed an eight percent tax on junk foods – foods high in salt, sugar and saturated fat, as well as an four percent tax per litre on sugary drinks such as soda.

President Nieto said at the time that the Mexican government has taken a long-term view of the situation, as the potential economic harm from reduced sales of junk food/ drinks is relatively insignificant to the medicals costs associated with food related diseases such as obesity, diabetes and heart disease.


World’s largest integrated dairy production base to be built in NZ

Chinese leaders together with New Zealand’s Prime Minister John Key, have unveiled plans for the Yili Oceania Production Base.

The production base will cover packaging, production, processing and R&D to become the world’s largest integrated dairy production base.

Yili Group, a privately owned company engaged in the processing and manufacturing of milk products, has invested more than RMB 3b into the project, inclusive of a 1.2b initial investment and a newly added investment of RMB 2b.

The new investment will be used in four parts including a raw milk deep-processing project, a UHT liquid milk project, a milk powder production facility and a packaging facility.

In addition to the funding, the Yili Group and Lincoln University signed an agreement known as: The Agreement on Scientific Cooperation across the Whole Dairy Industry Chain. Under the agreement, the two sides will carry out in-depth cooperation based on their unique resources and technological advantages, focusing on the strategy of the whole dairy industry chain.

The first step of the agreement is to focus on innovative technologies for improving nutrition and quality assurance in dairy products in the coming years.


OceanWatch Australia increases traceability with QR codes

Marking an Australian fishing industry first, OceanWatch Australia has introduced unique QR codes for fresh seafood, providing wholesale buyers with a complete picture of where, how, and by who the catch was caught.

The codes are part of the OceanWatch Master Fisherman Program and were launched on World Fisheries Day, Friday 21 November. By scanning the code, buyers are able to access information relating to the fisher behind the catch, how the seafood was caught, which part of Australia the seafood comes from, and information about the characteristics of the species, migration patterns and population statistics.  

“These QR codes offer real transparency around the provenance of seafood. It’s important the community knows where their seafood comes from, and is confident the fisher is dedicated to responsible fishing and best-practice techniques to protect our marine environments,” said Brad Warren, executive chair OceanWatch Australia.

“The QR codes provide wholesale buyers with the tools to make informed purchasing decisions and ensure consumers, in turn, are eating a responsibly caught catch.”

In order to gain OceanWatch accreditation and be allocated a QR code, fisher must complete the Master Fisherman Program which is jointly funded with the Fisheries Research and Development Corporation (FRDC).

The program involves setting protocols and standards for everyday fishing practices; from assessing the equipment fishers use, to the steps they take in reducing bycatch. Fishers must also complete food safety training and hold a maritime competency qualification.

“OceanWatch has ensured its Master Fisherman Program aligns with the United Nation’s Code of Conduct for Responsible Fisheries. To date, the accreditation and QR codes have already been allocated to over sixty NSW Estuary General fishers,” says Warren.

“The QR codes will be launched to the wholesale market on November 21, with a roll out to retailers to follow. In the meantime, the information from the QR code will be available to consumers on the OceanWatch Australia website and any store displaying the QR code.”  


JBS to acquire Primo Smallgoods for $1.45 billion

Australia’s largest fresh meats processor JBS Australia has signed a $1.45 billion conditional agreement to acquire Primo Smallgoods.

As Australia’s largest ham, bacon and smallgoods producer in Australia and New Zealand, Primo’s operations include five key processing plants between the two countries, employing over 3,000 people.

The move is set to leverage Primo’s growing export operations across Asia, including China, and is consistent with the global strategy of JBS – which is the largest animal protein processing company in the world – to grow its presence in value-added products.

“While it will remain very much business as usual for our employees, suppliers and customers, this transaction offers tremendous opportunities for a producer of high quality products like Primo,” said Paul Hitchcock, Primo Group CEO. “We look forward to being part of JBS and capitalising on its international distribution network.”

“Primo Group is the leading company in this segment with strong brands and represents an outstanding opportunity to grow our business in Australia and internationally,” JBS CEO, Wesley Batista said.

“We are seeing strong annual growth in consumption of processed meat products with good prospects to increase exports of high quality convenience products from the Primo Group’s portfolio.”

The transaction is subject to relevant regulatory approvals.

In addition to Primo, JBS Australian announced in July that it had purchased a majority shareholding in the family owned, Sydney based company, Andrews Meats.


Australian organics industry enjoys record growth

The biennial Australian Organic Industry report was released today, highlighting key categories that are driving significant growth results.

The Australian Organic Market Report, commissioned by organic certifier Australian Organic, tracks trends in the Australian organic marketplace based on research by the Mobium Group, Swinburne University of Technology and ABS statistics.

The report found that consumption of certified organic food, cosmetics and household products are now valued at over $1.72 billion, representing a 15.4 percent compound annual growth rate since 2009.

Key findings across industry sectors driving growth:

  • Dairy is the fastest growing organic category in 2014, now estimated to be worth $113m
  • With compound growth of 127 percent 2011–2014, beef is the second fastest growing sector with a total value of $198m in 2014
  • Wine grape production increased by a staggering 120 percent between 2011 and 2014 and is worth $117m
  • Despite suffering during the drought, the organic grain category has grown by 20 percent with total crop values lifting by 67 percent in three years

Dr Andrew Monk, chairman of Australian Organic says that with demand for organics outstripping supply by up to 40 percent, the Australian retail market for certified organic products expected to continue to grow with private label products, certified organic processed foods and greater affordability driving this trajectory.

“One of the most significant findings was that 69 percent of primary food shoppers in Australia claim to have bought at least one certified organic product in the past 12 months. This demonstrates that organics are gaining greater penetration beyond the group of consumers who have traditionally purchased them,” says Monk.

“For the first time, we asked consumers their reasoning behind choosing organics with 49 percent of respondents claiming that they first purchased certified organics as they became aware of the impact food, fibre and cosmetics may have on their health. 16 percent began buying organic specifically because of a health crisis.”

The report has also revealed the perceived benefits of organic products are consistently associated with what organic food does not contain and is not produced with. The top six being: chemical free (80 percent), additive free (77 percent), environmentally friendly (68 percent), hormone and antibiotic free (meat) (60 percent), non-GM and free range (each 57 percent).

Other key Australian Organic Market Report 2014 findings include:

  • Organic purchases by those who are not categorised as green or sustainable shoppers increased from 24 percent in 2012 to 40 percent in 2014.
  • The Australian Certified Organic logo is by far the most recognised organic certification mark – a significant leap of 22.5 percent in awareness from 2012.
  • 32 percent of shoppers say they would only buy a product labelled as ‘organic’ if it is certified organic.
  • Australia still has the largest area of organic land in the world (22 million hectares) and there has been a 53 percent increase in fully certified organic land area between 2011 and 2014.
  • Exports of organic products have more than doubled from 2012 to 2014 with the organic export market now worth $350m.
  • Australian organic production (farm-gate) value is $508m, up 18 percent since 2012.
  • In non-alcoholic beverages, organic coffee saw the most dynamic retail value sales growth of 15 percent to reach $10m in 2013.


Fat-burning beverage on the cards for Nestle

A team of eight scientists at the Nestle Institute of Health Sciences in Lausanne, Switzerland say that they have identified how an enzyme in charge of regulating the metabolism can be stimulated by a compound called C13 which mimics the fat-burning effect of exercise.

The scientists say that their task now is to look for natural substances that can act as triggers to stimulate the C13 compound, Bloomberg reports.

Fruit and plant extracts are currently being examined to identify which ones could modulate the enzyme known as AMPK which facilitates the body’s use of sugar and fat. Kei Sakamoto, a scientist who oversees research on diabetes and circadian rhythms at Nestle, says that the goal is to create a product that has the ability to mimic the effect of exercise for those that are less mobile.

“The enzyme can help people who can’t tolerate or continue rigorous exercise,” Sakamoto told Bloomberg. “Instead of 20 minutes of jogging or 40 minutes of cycling, it may help boost metabolism with moderate exercise like brisk walking. They’d get similar effects with less strain.”

Sakamoto said that testing of the product on animals will not occur for at least the next few years.

The development of a fat-burning beverage is in line with Nestle’s new strategic direction which involves selling off weak food brands in favour of scientific lines.

Nestle recently sold its PowerBar business as well as the bulk of its Jenny Craig business, stating that further divestments of other underperforming brands could also take place.


a2 Milk plans to list on ASX

New Zealand’s a2 Milk is planning on listing on the Australian Securities Exchange.

The move, which was announced at the company’s general meeting on Tuesday, would see the company achieve a dual-listing, and potentially boost the liquidity of its shares.

The company said that it has already commenced the application process for an ASX listing, which it hopes to have completed with the first quarter of 2015, SMH reports.

"With a significant part of our earnings and growth coming from Australia, seeking an ASX listing is a logical strategic move for the company," Geoffrey Babbage a2’s managing director said.

"Listing on ASX will enable more Australian investors to participate in the company's growth and will increase the attractiveness and liquidity of its shares. The board believes that this will benefit all shareholders."

a2, who is being advised by Goldman Sachs and DLA Piper, said that no new capital will be raised in the listing and that the company will remain incorporated in New Zealand.

The popularity of a2 Milk has been increasing rapidly over the last number of years due to reports that the a2 beta-casein protein is easier to digest than A1 – a view that has often been shunned as scientifically unfounded.

Earlier this year, Curtin University received funding from the a2 Milk Company to conduct a pilot study into the digestive benefits of a2 milk, and found that subjects on a diet of a2 milk reported less bloating and abdominal pain than those consuming A1 milk.


Export markets to Asia and Middle East must be expanded, Ausveg

Following the announcement of the China Australia Free Trade Agreement yesterday, Ausveg says that more needs to be done if the Australian vegetable industry is to continue to thrive.

Ausveg, the peak industry body for horticultural industry, says that export markets to Asia and the Middle East must be expanded, and that continued investment in research and development is key.

“The FTA with China is an important step for the Australian vegetable industry in its development as a powerhouse of international horticultural production,” said Ausveg CEO Richard Mulcahy.

“Many Asian and Middle Eastern countries, including China, have booming middle-class populations wanting to import produce. They are attracted to Australia’s fantastic reputation, and know our growers use the safest production methods to grow the best quality produce in the world.”

Mulcahy says that the industry must continue to invest heavily into R&D to increase production quality and transport capabilities as well as decrease costs and help growers break into export markets.

“Consumers want the best quality vegetables available and are willing to pay a premium price for Australian-grown vegetables,” he said.

Key outcomes of the China Australia Free Trade Agreement include:

• 7.5 to 30 per cent tariff on orange juice removed within 7 years, and tariffs of up to 30 per cent on other fruit juices removed within 4 years,
• 15 per cent tariff on natural honey, and the up to 25 per cent tariff on honey-related products removed within 5 years,
• 15 per cent tariff on pasta removed within 4 years,
• 8 to 10 per cent tariff on chocolate removed within 4 years,
• 15 to 25 per cent tariff on canned tomatoes, peaches, pears and apricots removed within 4 years,
• 15 to 20 per cent tariff on biscuits and cakes removed within 4 years, and
• 20 per cent tariff on soft drinks removed within 4 years.


Which flavours will be favoured in 2015?

2014 seemed to be the year of the coconut. Whether it was coconut oil, coconut water or some sort of extract, it was one ingredient that demanded attention. But which ingredients and flavour trends will lead the way in 2015?

Food magazine recently caught up with some of the industry's top marketing research companies to look at which ingredient and flavour trends manufacturers will be at the mercy of in 2015.

When it comes to identifying which flavours will dominate, the overarching consensus was in regards to those conducive to the health and wellness movement.

"Consumer concerns regarding health and an increasing demand for convenient foods that fit in with time-poor consumers are expected to drive product trends over the next five years," says Caroline Finch, senior industry analyst at IBISWorld.

"Producers are expected to increasingly integrate exotic flavours with premium and healthy ingredients, such as wholegrain, fibre, protein and vitamins promoted for specific health benefits."

Similar to what we saw in 2014, Finch says that the popularity of "superfoods" is expected to increase within the health and wellness category.

"Superfoods that are forecast to continue to gain popularity in 2015 include maca powder, chia seeds, goji berries, acai, raw cacao, hemp seeds, coconut oil, bee pollen, and wakame seaweed. Free-from products are also expected to be a growth area, as more and more consumers discover that they have intolerances,allergies or sensitivities to certain foods."

Turning fads into sustainable trends

Lead analyst at Canadean, Michael Hughes says that two of the current trends in the FMCG space will continue into 2015:  hot and spicy ingredients from the Far East and South America, and the introduction of more 'superfood' ingredients such as beetroot juice. Specifically in relation to superfoods, Hughes says that the popularity of FMCGs containing these ingredients will continue to increase.

"This trend will continue to gain momentum in 2015, as consumers continue to seek out magic bullet solutions for their health needs – the key for manufacturers is ensuring such "fads" are turned into sustainable trends and that consumers understand they need to be consumed in accordance with a balanced diet," he says.

"Alternative protein will become a big trend – particularly in the dairy category. We also anticipate that vegetable nutrition will become a big trend with demand for beetroot juice expected to grow in particular."

Daniel Grimsey, senior research analyst at Euromonitor International believes that the superfood trend is likely to increase, but warns that not every consumer is on board.

"I guess it depends on the social aspects. A lot of people are obviously into quinoa and gluten-free products, while other people hate that sort of thing," he says. "I suspect that [superfoods] will become more mainstream but it could go either way."

Functional beverages on the rise

Other areas to focus on include the gluten-free space which has gained immense popularity over the past five years, and is expected to continue to gain momentum.

But an interesting category to watch is that of plant-based water and 'superfruit' enriched beverages. Grimsey expects that elderflower, chia and superfruits such as pomegranate will emerge in the beverages category, whereas Finch of IBISWorld believes that chlorophyll may be an ingredient to watch.  

"There is considerable innovation in the functional beverage category," says Finch.

"Consumers that purchase these products are typically well informed, and will select the type of plant-based water depending on the health benefits they provide. chlorophyll water is a trend that may build."

Hughes from Canadean expects the popularity of plant-based waters such as coconut water to increase, however he stresses that the market is still comparatively small compared to the soft drink market.

"It will have to be remembered that these categories will remain a niche," says Hughes. "The demand however will be driven by consumers looking to exit the carbonated soft drink market and instead seek out healthier alternative beverages. For those less driven by the desire for health, price can be a barrier for such products."

Leading the way in innovation

In terms of product innovation and addressing any gaps in the market, the health and wellness category continues to be the one to watch. However Hughes warns that the positioning of particular products within the category needs attention to secure sustainable demand.

"At the moment, I think more could be done to align certain ingredients with who should be their core audience in order to sustain fads into trends and by moving away from those consumers simply seeking a magic bullet health solution," he says.

"For example, coconut water manufacturers should do more to position products at athletes because of the potassium content, whilst alternative protein manufacturers are missing a trick not doing more to highlight the importance of protein and muscle retention to an ageing society."

Still within the health and wellness category, Finch from IBISWorld believes that there is plenty of room to grow within the vegan, biodynamic and raw food categories in mainstream supermarkets, despite a surge in new product releases over the past few years. She also adds that products targeting specific food intolerances will continue to experience increased demand.

"Products targeting fructose malabsorption also present an opportunity, as awareness builds with consumers. At the moment, there is not much depth in the range of products aimed at these consumers, presenting an opportunity in the market," she says.

Categories to watch

Finch also emphasises that manufacturers of health foods are in a stronger position for growth when compared to producers of traditional snack foods.

According to IBISWorld data, health and snack food production has experienced a six percent annualised growth in the five years to 2014-15 ($601.9 million), with forecast growth at 4.7 percent annually for the five years to 2019-20 ($758.4 million). Whereas snack food production is sitting at 1.3 percent annualised growth in the five years through to 2014-15 ($2.4 billion), with forecast growth at 1.6 percent annualised in the five years to 2019-20 ($2.6 billion).

"Some players have enjoyed immense growth by tapping into niche markets with unique ingredients, production methods and flavours," says Finch. "For example the milk company. A2 enjoyed revenue growth of almost 16 percent in 2013-14 with its milk products aimed at consumers with dairy-related digestive issues, and Carman's Fine Foods revenue increased at an annualised 24.6 percent over the five years up to 2013-14, due to the growing popularity of its health snack foods."

To add to this, Euromonitor's Daniel Grimsey believes that private label brands within the health and wellness category are leading the way in terms of product innovation.

Grimsey says that the Macro and gluten-free section in Woolworths has been particularly well executed.

"As far as health foods go, about half the market within Woolworths seems to be private labels, not to mention the Coles Finest and Woolworths Gold at the premium end of things which appear to be pushing more exotic ingredients," he says.

"Also Sanitarium Weetbix in the last year or so has branched out in several areas. They have a gluten-free version and a protein enriched version, so major brands like that which have enough shelf space can have different variants such as those.

"Goodman Fielder is also introducing gluten-free bread to the mainstream audience, and Nudie Foods is another brand to watch as they have introduced a juice containing chia now. Within the iced tea space, the Stolen recipe brand is another innovative manufacturer."

Michael Hughes from Canadean says that in his opinion, Nestle is one brand that is ahead of the curve.

"Nestle is investing a lot in health and functionality, and I am really interested to see how it make strides in the market over the next couple of years given their R&D investment," he says.