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SPECIAL REPORT

Colours
In 2008, the European market for colours was worth €361m, with volume consumption totalling 6,307 tonnes, according to RTS. The largest markets in the EU15 are the UK, at almost €75m, closely followed by Germany (almost €73m) France, Italy and Spain. The European market has seen a growth rate of around 0.9% year-on-year during the past five years (from 2003).

Western Europe

The European market for colours

€361m
Total market value of colours in Western Europe, 2008
Source: RTS Global Ingredient Database

In terms of growth, Spain has been showing the highest average annual rate, followed by Portugal, Belgium, Ireland and Denmark. Although these are not particularly high growth rates, given the above factors, the UK market has performed even worse. Europe’s slow growing food market, together with increasing manufacturer avoidance of colours usage have had an effect on volume growth, whilst the need for colours where ‘natural’ alternatives are yet to be developed has helped to maintain growth in terms of value.

Data and analysis taken from Colours - a Food Manufacture Market Report produced in association with RTS.

Colours Western Europe

Special Report

Where are colours used?
Usage of colours is highest in soft drinks (€75m), followed by confectionery and meat & savoury products. Colours are also used in bakery and cereals & cereal bars.

Colours
Western Europe: Market value of colours by key country, 2008 €m

Rest of EU15 €83m Spain €37m

UK €75m

Italy €47m France €47m

Germany €73m

Source: RTS Resource.

Colours
Western Europe: Market value of colours by segment, 2008 €m

Varying success
Usage in soft drinks is in slight decline, mainly as a result of consumer health concerns, especially as they relate to children. The use of colours in cereals and cereal bars has grown well. Not only have these markets grown but so too has the proportion of added value and children’s breakfast cereals. The bakery segment has also performed relatively well.

Soft drinks Confectionery Meat & savoury Butter & yellow fats Fruit & vegetables Yogurt & desserts €45m €39m €32m €22m €22m

€75m

Source: RTS Resource.

Data and analysis taken from Colours - a Food Manufacture Market Report produced in association with RTS.

© Copyright RTS Resource 2009

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Colours Western Europe

Special Report

Key Trends

Key Drivers

Colours help to keep foods looking ‘fresh’ The main drivers are, as follows: throughout their shelf life or during processing - but recent reports (see The • Health - particularly for children Southampton Study, below) and media • Development of ‘natural’ interest have heightened pressure on alternatives companies to choose ‘natural’ alternatives • Movement from artificial towards instead. Whilst this is likely to have a nature identical (NI) damaging effect on the use of certain colours, synthetic colours remain in demand in areas where viable natural alternatives have yet to be developed.

Pressure from EFSA: The Southampton Study
In December 2007, the European Food Safety Authority (EFSA) was asked to assess a study carried out by the University of Southampton, which suggested that certain mixes of food colours with the preservative sodium benzoate (commonly used in soft drinks) could cause hyperactivity in children. The main conclusion subsequently brought to the European Commission by the EFSA was that artificial food colours and additives were seen to exacerbate hyperactive behaviour in children, at least to middle childhood. Since the study’s findings were published, official EU advice to parents suggests that children susceptible to hyperactivity should avoid the following: • Sunset yellow (E110) • Quinoline yellow (E104) • Carmoisine (E122) • Allura red (E129) • Tartrazine (E102) • Ponceau 4R (E124) Whilst some controversy remains around its findings, The Southampton Study has encouraged many retailers and manufacturers to reformulate products containing the above colours. This is not a new phenomenon, as many companies have been working for years to replace artificial colours, but this study was significant in accelerating the process.

Further information is available in: Colours - a Food Manufacture Market Report produced in association with RTS.

© Copyright RTS Resource 2009

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Colours Western Europe

Special Report

Forecasts
RTS forecasts show that growth in the colours market will continue to be low in the future. Usages in some segments will decline and, in others, become static. At the same time, there will become less opportunity to add value, given overall market conditions. Although there will continue to be some movement from synthetic and NI colours to naturals, especially as more stable naturals are developed, more manufacturers will choose to use colouring foodstuffs or use no added colour at all. At the same time, and as a direct consequence, there is expected to be significant growth in the development and use of colouring foodstuffs with major retail groups and global brands continuing to lead the way.

Colours
Western Europe: Forecast growth in usage of colours by country, 2008 to 2013 CAGR %

Spain Denmark Ireland Belgium France Finland

1.0% 1.0% 0.9% 0.7% 0.7% 0.7%

Source: RTS Resource.

Key areas for growth & development:
In terms of ingredients, key areas for growth and development are forecast to be: •natural colours •‘nature identical’ colours (NI) •colouring foodstuffs •‘healthier’ alternatives.

Want to know more? Contact RTS
RTS Resource Ltd Tel : + 44(0)1902 422282 E-mail : jamie.rice@rts-resource.com
Web: www.rts-resource.com

Data and analysis taken from Colours - a Food Manufacture Market Report produced in association with RTS.

© Copyright RTS Resource 2009

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Colours Western Europe

Special Report

Glossary
What is a Colour? A colour is a dye, pigment or other substance made by a process of synthesis or similar, or extracted, isolated or otherwise derived; with or without intermediate or final change of identity; from a vegetable, animal, mineral or other source. When added or applied to a food it is capable of imparting a colour (either alone or through reaction with another substance). Colours include: • natural • nature-identical (NI) • synthetic Advantages of Synthetic colours: • intense colours • smaller quantities required • more heat stable than natural • more light stable than natural • able to better survive heat processes - e.g. canning and boiling Colour uses: • improve appearance of food & drink • restore colour lost during processing • assist consumer perceptions of flavour before eating

DEFINITIONS - please note:
• Data provided in this article refers to the industrial usage of the above • ‘European’ refers to the 15 original members of the European Union (EU15) • Caramel and ‘colouring foodstuffs’ (natural plant materials or undeclared colours) are not included in this analysis • Products covered include both in-home and out-of-home • Source: RTS research from the RTS Global Ingredients Database from multiple sources

www.rts-resource.com

© Copyright RTS Resource 2009

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