Is the omega-3 sector in decline?

27-Feb-2014 - Last updated on 01-Aug-2014 at 17:54 GMT

Growth in fish oil sales have been described by the CEO of Vitamin Shoppe as ‘softening’, while data from GOED indicates that 12 million users have left the category in the US, so is the omega-3 sector in decline?

First came the meta-analysis questioning the efficacy of omega-3s for heart health in 2012, and this was followed by last year’s controversial prostate cancer study. The mainstream media is increasingly publishing negative articles about the omega-3 industry, and the messages are affecting the omega-3 sector.

While last year’s controversial prostate cancer study led to an estimated 11% drop in retail sales over six months, GOED’s Ellen Schutt said the decline started in 2012 with publication of a meta-analysis in JAMA (Vol. 308, pp. 1024-1033) which concluded that supplementation with omega-3 polyunsaturated fatty acids was not associated with a lower risk of cardiac death, sudden death, heart attack, or stroke.

Data presented by Schutt at the recent GOED Exchange (see figure below) revealed that sales were already slowing in 2012, with a decline starting in September – the same time as the JAMA publication.

The figure above stops at July 2013 – the same time as the prostate cancer study by Brasky et al. was published.

“This was the atmosphere when the prostate cancer hit,” said Schutt. “There were slowing sales, a lack of positive media, and then the sensational headlines around an increased risk of cancer.”

The result is a loss of 12 million omega-3 consumers, she said.

Consumer analysis indicated that 5.5% of consumers left the category between June 2012 and August 2013, she said. Unsurprisingly, a large proportion has been men aged over 55, with data indicating an 11.5% drop in this group. Perhaps surprisingly a significant drop in younger women has also been recorded.

Going niche?

Omega-3 sourced from anchovy has been the biggest hit in the US market, with data from Nielsen indicating a $27.4MM drop in value sales for anchovy from 2012-2013. There were a couple of big winners, however, with krill and concentrates recording $18.7MM and $16.7MM increases in value sales in 2012-2013.

fish and krill — Some consumers are upgrading to niche products like krill oil and omega-3 concentrates

More expensive products appear to now be driving sales, with an increase observed for products costing greater than $21 per sku.

“The niche markets are growing,” said Adam Ismail, GOED executive director, “and we’re seeing people upgrading and taking growth to the niches. But the effect on the anchovy sector is affecting everyone.”

‘It’s not vitamin E, but it’s still serious’

“The declines are serious for the omega-3 industry,” said Ismail. “Maybe not compared to something like vitamin E, which collapsed deeper and faster back in 2004, but omega-3s have grown consistently for more than three decades and at high growth rates.”

Ismail said that there are two main reasons behind the decline: First, there is a percentage of consumers that are persistently lapsing consumers. These have always been there, he said, but there has always been an inflow of new consumers to overcome the lapse rate. However, the new consumers are not coming to the sector.

Secondly, the lapsing users are exposed to the media coverage of these negative studies and it’s reminding them to not take their omega-3s.

A decline or just a blip?

Some market watchers are optimistic about the future, however. Speaking at NutraIngredients’ recent Nutritional Lipids and Oils event, Euromonitor expert Diana Cowland advised listeners not to worry about the flattening of the market in the US associated with a recent negative study linking omega-3s with heightened prostate cancer risk. “I expect whatever effect it might have will be temporary,” she said.

For Euromonitor, the omega-3 market continues to grow and appears to have unstoppable momentum worldwide.

Heart health meta-analysis and that prostate cancer study

The 2012 meta-analysis was strongly criticized at its time of publication by GOED and the CRN, and despite a strong body of evidence supporting the heart health benefits of omega-3s, including a Harvard University analysis that estimated that 84,000 deaths a year could be prevented by adequate omega-3 consumption, the mainstream media took a negative view of the study.

“The meta-analysis was the first uptick in negative media,” said Ismail, “and it’s been consistently negative since then.”

Indeed, GOED has been tracking the reporting on omega-3 in major US media outlets, and found that 80-90% of readers exposed to omega-3 in the mainstream media would have been getting negative messages in Q4 2013 (see figure below). The organization is now exploring ways to change the conversation on omega-3s.