From Paleo to Probiotics: What are the hottest trends in the natural food and beverages market?

03-Mar-2016 - Last updated on 06-Aug-2019 at 08:03 GMT

Early adopters of bone broth include Paleo diet enthusiasts. Picture: Lonolife

From bone broth to grass-fed dairy, trends which start in the natural food market have the potential to move to the mainstream faster than ever before as conventional retailers seek to get a bigger slice of the action in natural and organic foods, says a new report from investment banking firm Silverwood Partners.

According to Silverwood, the following trends are worth watching:

1. LOCAL PRODUCE: A sizeable amount of investment capital has recently been pumped into companies offering consumers new ways to access fresh, local produce, from MightyVine and BrightFarms to AeroFarms.

2. CLEAN LABELS: More big food companies are jumping on the clean label bandwagon.

3. CRAFT: 'Craft' is gaining share in beer and soda.

4. ORGANIC: Whole Foods and other natural chains are feeling pressure from conventional grocers that are upping their organic offer (Kroger, Target etc). According to BMO Capital Markets, meanwhile, only 24% of customers said organic products at Whole Foods were ‘definitely’ of higher quality than organic food at conventional grocery stores.

5. HEALTHY SHIFT: Consumers are more focused on real, quality food, positive nutrition, and fresh, less processed foods than dieting and calorie-counting. Meanwhile fat is back and added sugar is under fire.

6. GUT HEALTH: Digestive health is a hot trend, probiotics are moving well beyond dairy (cf. GoodBelly, Nomva).

7. GRASS-FED: Gaining momentum in meat and dairy (Epic, Thew New Primal, Dreaming Cow).

8. PROTEIN: Expect continued investment in plant-based proteins in particular (peas, flax, quinoa, chia), says Silverwood, although interest in insects and algae is also likely to grow.

9. PALEO/BULLETPROOF: Low carb high fat diets are getting more airtime. According to Harvard Business School, meanwhile, Paleo has benefitted from its close ties with CrossFit, which has grown from 13 affiliates in 2005 to to 12,000 in 2015.

10. BRAIN HEALTH: More capital is being pumped into nootropic foods and supplements claiming to enhance mood, cognition, memory and learning.

Meanwhile, the trend for large CPG companies to invest in or acquire smaller, more innovative brands in fast-growing natural and organic categories, shows no sign of abating, says Silverwood Partners.

As for where money is going, plant-based or ‘alternative’ proteins remain in vogue, it adds, citing the recent acquisitions of Neat Foods, VEGA, Quorn and Gardein and investments in Hampton Creek, EXO, Impossible Foods, and Beyond Meat.