The magic year 2020 has passed. Looking back on the events in the food and beverage industry in this year, what is the most eye-catching segment of the track that you think of for the first time? What is the representative brand / product of this track? What is the “technology” behind it?
And the strongest “concept stock” that can really achieve three goals with one arrow in view of the above problems, and “no saccharification” must be considered as one. It has not only made the market segment of sugar free bubble water popular, but also made the domestic dark horse Yuanqi forest in the beverage industry with an estimated value of 14 billion yuan. The sugar reducing technology behind it, the natural sugar substitute supply enterprise, has become a hot spot in the stock market.
At the same time, I don’t know if you realize that 2020 can be regarded as a year of qualitative change in promoting the development of food and beverage by Chinese consumers’ cognition of reducing sugar. According to foodaily,
Image source: Google
Looking around the world and looking back carefully, the concept of sugar free is nothing new. Although it has been struggling with “sugar” for decades, the number of times it has been able to form awareness in the hearts of consumers at the track / brand / technology levels is actually very few. Next, let’s take a look at some representative highlights of this most innovative concept stock? What is the underlying foundation of popular feeling? What changes are taking place in the field of sugar reduction?
With the change of “natural sugar substitute”,
No saccharification concept ushers in high light moment
Looking back at the bumpy development history of sugar substitutes, while being questioned by the health of artificial sugar substitutes, the evolution of natural sugar substitutes ushered in the following three representative highlights of the concept of “no sugar”.
Reducing sugar and no sugar is not a new concept. As early as the 19th century, people realized that excessive sugar intake would lead to a series of diseases such as obesity, diabetes and so on.
As a result, the scientific research on sugar substitutes has been put on the agenda. In 1879, saccharin, the first artificial sugar substitute, was born. Since then, sodium cyclamate, aspartame, sucralose and acesulfame have been on the stage of history. These sugar substitutes are sweet, almost calorie free, and do not cause dental caries. But in the beginning, these sugar substitutes were only used as a treatment for patients with diabetes and obesity, and did not really enter the life of ordinary people.
With the development of health awareness and sugar reduction awareness to the public, food and beverage enterprises have come up with the solution of sugar substitute, which has become cheaper and meets the health demands of consumers, and sugar substitute began to appear in food and beverage. In 1964, Pepsi Cola first introduced the first sugar free beverage, light Pepsi, which used aspartame instead of sucrose. Subsequently, Coca Cola also launched diet coke. However, at that time, these two products did not attract the attention of consumers, but caused the academic debate on the safety of artificial sugar substitute.
Light Pepsi, image source: Google
Until 1984, Wrigley launched its first sugar free chewing gum, Yida gum, in the United States. The product used non carious xylitol instead of sucrose. In 1996, Yida landed in China and put it on trial sale in Guangdong. Compared with the 100% chemical synthesis of sugar, sugar alcohol is relatively “natural”, while xylitol is not carious and more refreshing, which has won the favor of consumers. This is also the first time that sugar free concept has successfully created a popular product of chewing gum. Yida’s advertising and brand image of “care for teeth, care more about you” are deeply rooted in the hearts of the people. At the same time, it has successfully promoted xylitol to consumers and become a health ingredient recognized by consumers.
Image source: repinku.com
The real wave of large-scale sugar reduction began at the beginning of the 21st century. During this period, the public health status of many countries in Europe and the United States was getting worse and worse, so that the world officials began to gradually implement sugar reduction policies. Among them, the most effective are Mexico and the United Kingdom.
In 2014, Mexico took the lead in introducing the “sugar tax” policy. The Mexican government will tax 10% extra on sugary drinks and 8% extra on nonessential high calorie foods. In 2016, the UK announced that it would levy a “sugar tax” in 2018. The sugar tax on all soft drinks produced and imported in the UK is divided into two levels: 5 g or more and 8 g or more per 100 ml, with the highest tax rate of 20%.
Image source: Google
So far, the number of countries taxing sugar drinks in the world has increased to 29. With the implementation of “sugar tax”, carbonated beverages bear the brunt, and its low saccharification or no saccharification has gradually become an irreversible trend in the global beverage industry. The giants represented by Coca Cola are also constantly looking for sugar substitute formula to find a new balance between taste and health. Pure natural sugars such as stevioside and Momordica grosvenorii fructose have also entered people’s field of vision.
Photo source: Coca Cola
In addition to Coca Cola, during this period, zevia, a new black horse focusing on Stevia for sugar free drinks, was born in the U.S. market. From the name, it is easy to see the relationship between it and Zero sugar, stevioside.
Founded in 2007, zevia is the first zero calorie soda product to use stevia, and now it has become one of the fastest growing leading beverage companies in North America. At present, it has a series of products including zero sugar sodas, energy drinks, tea drinks, alcoholic drinks, children’s juice drinks and so on, which replace traditional sugars with stevia, and won a financing of US $200 million in December 2020. Today, stevia is also a highly recognized natural sugar substitute in the hearts of American consumers, and is widely used in other segments.
Compared with the sugar reduction policies of other countries in the world, China has not introduced any relevant policies and measures for sugary drinks and food. However, at present, chronic diseases have become the number one killer endangering the health of Chinese residents, and China also put forward the guiding policy of reducing sugar and fat in 2017.
The domestic beverage giants represented by Nongfu Shanquan entered the category of sugar free tea many years ago. Although they had been questioned because of their bad taste, their insistence on sugar free tea has also achieved results in recent years.
This year, the most eye-catching case is Yuanqi forest, which was established in 2016. Aware of young people’s desire for sweetness but fear of sugar, Yuanqi forest aims at the segment of soda bubble water, uses erythritol instead of aspartame and other traditional sweeteners, seizes the channel bonus of convenience stores, and successfully occupies the user’s mind by continuously strengthening the concept of “0 sugar, 0 calorie, 0 fat”.
Image source: Google
In addition to making consumers fall in love with the delicate bubble taste again, and making Yuanqi forest rush into the head camp of domestic drinks, consumers also began to pay attention to the four words “erythritol” in the ingredient list, and the sugar substitute supply enterprises behind it also ushered in a sharp rise in stocks.
The highlight of non saccharification is inseparable from the promotion of “sugar reducing technology”. From artificial sugar to natural sugar, people finally choose to find a balance solution between health and taste. Whether it’s candy or soda bubble water, it’s important to choose a good track, but the evolution support of “technology” behind it is also important.
Lively upstream sugar substitute Market
With the advent of the global sugar free trend, upstream suppliers are speeding up their pace.
Not long ago, Tailai wholly acquired sweet green fields (SGF), an American Stevia supplier, and hopes to speed up the innovation of Stevia products by establishing a fully integrated supply chain. The acquisition will help Terai bring more stevioside products and integrate its supply chain, and further expand its business in the Asia Pacific region through its stevioside production and R & D facility in Anji, China.
Image source: Google
Also in 2020, irean and Prosecco have reached an agreement that irean will acquire 75% of Prosecco’s equity. This joint effort will help them further expand their global Stevia business. In addition, yiruian has introduced a new sweetener erysta, which is made from erythritol fermentation, and has been widely used in soda water or snacks. In addition to stevioside, irean is also involved in aloulose.
In December 2018, irean established a cooperative relationship with matsugawa chemical of Japan to produce and sell the sweetener Astraea allulose in the whole American and Asian markets. As a promising new low calorie sweetener, arolone sugar has a very similar taste to sugar, and is suitable for various applications such as beverages, dairy products, baked goods and candy.
In addition, Cargill’s also screened a derivative of stevioside, which has a clean and refreshing sweet taste and no heat, and can perfectly replace fructose in beverage, candy and cooking. Meanwhile, both Fannie Mae and ADM are studying different sugar reduction schemes, which are suitable for different sub categories.
The stevioside that the tycoons have jointly seized is not what it used to be. According to innova, the number of new product releases using Stevia worldwide increased by an average of 13% annually from 2014 to 2018. In the global new food and beverage products in 2019, stevioside as a natural sweetener is second only to sucralose and acesulfame. Since the FDA approved the GRAS status of stevioside REB a in 2008, stevioside has been evolving in the face of bitter and aftertaste doubts. Now the new generation of stevioside components (REB D, REB m) can achieve better taste.
In the commercialized application cases, in addition to beverages, stevia and other sugar substitutes have been widely used in snacks, dairy products, Tangqiao, baking and other categories in the European and American markets to meet the demand of consumers for sugar free.
For example, in the Chinese market, there is no ice cream that can satisfy both delicious and healthy taste, so we can use stevioside instead of refined sugar to reduce consumers’ sugar intake. For example, many ice cream brands like halo top, which you may be familiar with, will choose stevioside as a substitute.
Photo source: halo top
In addition, in April 2019, the FDA issued a draft guidance to exclude alloxan from the nutritional composition tables of “total sugar” and “added sugar”, which is a major positive news for many companies using alloxan. The key to the future success of this kind of sugar substitute lies in its wide application in the fields of baked goods, candy, frozen candy, dairy products and beverages, among which baking is worth mentioning.
The choice of substitute sugar in baking has always been a difficult problem, but it is also an urgent category for non saccharification transformation. In the Maillard reaction, the brown color of aloulose is also very good. This makes it an excellent sweetener for baked goods. In addition to alloxan, erythritol is popular in baking mixes and baked goods because it turns brown like sugar.
The research on reducing sugar has not stopped, and we have reason to believe that with the support of technology, no sugar will once again usher in a highlight with the help of a certain segment of the track.
Innova data shows that in 2019, the number of new product launches with labels of “low sugar”, “no sugar” or “no added sugar” in the world nearly doubled compared with 2015, of which China’s share is only a small part. China is already the largest producer of sugar substitutes, accounting for about 75% of the world’s production in 2018, but the Chinese market lags behind the sugar free market.
2020 is just the starting point of the reform, such as proteoglycan, 3D printing new technology is also developing. Even if Chinese consumers have high requirements for color and fragrance, we believe that better and more solutions will emerge in the future.
1. Is sugar substitute an IQ tax? 》Tencent Research Institute, December 21, 2020;
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