Soyfoods: Trends and Developments

Report Highlights

• Increasing interest in soyfoods coming from more and more mainstream consumers who want to include more plant-based foods in their diet is creating demand from food and beverage processors, who in turn are demanding more soyfoods from manufacturers who market them. BCC forecasts that manufacturers' sales for soyfoods will increase from $5.9 billion in 2000 to $6.8 billion in 2005, at the rate of 2.7% per year.
• BCC forecasts that the largest share (76%) of manufacturers' sales for soyfoods is for soyoil products (soybean oil and lecithin), increasing from $4.5 billion in 2000 to $5 billion in 2005, at the rate of 1.9% per year.
• BCC forecasts that manufacturers' sales for whole soybean products will be the fastest-growing, increasing from $922.4 million in 2000 to $1.2 billion in 2005, at the rate of 5.6% per year. This is a product category that includes many different products that help consumers add soy into their diet, and use soyfoods as replacements for meat and dairy products.

INTRODUCTION

The increasing evidence that a good diet is linked to good health and the prevention of such major disorders as heart disease and cancer, has led consumers to demand more healthful foods and beverages from processors. Consumers want products with less fat, cholesterol, and calories, and that contain nutrients, phytochemicals, and fiber.

Coinciding with this consumer demand is the 1999 ruling by the Food and Drug Administration (FDA) that certain soyfoods can make a health claim on product labels.

The outcome has been a renewed interest in the soybean, a staple of Asian diets for centuries, and the soyfoods derived from it, that can be used as meals in themselves and/or ingredients by both processors and consumers.

Some of the soyfoods have long been known to processors for their functional value and high affordability. Others, however, are considered to be specialty or niche products because they were familiar mostly to consumers who shopped at natural/health food stores and Asian stores.

The renewed interest in soy, however, supported by periodic media messages, has caused it to be increasingly viewed as a mainstream product than a niche product, one that could appeal to all types of consumers looking for products that will create a healthful diet.

This incipient trend has induced some leading food and beverage processors to market some type of product containing soy, such as substitute meat or dairy products, or beverage using soymilk instead of cow's milk.

Some processors have been buying companies with established soyfoods and/or entering into various types of marketing alliances with them. These market leaders have the ability to get soyfoods into mainstream retailing outlets, such as supermarkets, where they will catch the eye of the mainstream shopper.

In response, manufacturers of the soyfoods themselves have created new or improved products that will help processors deliver appealing, tasteful foods and beverages to consumers.

These soyfoods include whole soybean products (miso, natto, tempeh, soy sauce, soy nuts, soy flour, soymilk and soymilk products—tofu, soy cheese, soy yogurt, nondairy frozen desserts, and okara); soy ingredients (defatted soy flour, defatted soy grits, soy protein concentrates, soy protein isolates, and textured soy protein, soy fiber, and soy isoflavones; and the soyoil products, soybean oil and lecithin.

The goal of this report is to understand how food and beverage processors are using the soyfoods marketed by manufacturers so that they can satisfy consumer demand for healthful products.

REASONS FOR DOING THE STUDY

The report was designed to achieve the following objectives:

• To identify the various types that manufacturers of soyfoods are making available to food and beverage processors and to consumers, for use as meals in themselves and/or ingredients.

• To describe the functional and nutritional value of each type of soyfood, and the applications in which each is used by food and beverage processors or consumers.

• To gain understanding of consumer (mainstream, niche/specialty) demands, what they want from soyfoods and how they use them to create a healthful diet, in order to suggest how processors can best satisfy these demands.

• To learn how social, economic, regulatory, and technological trends promote or hinder manufacturers’ sales to end-users (processors, marketers who will sell to retailers who then sell directly to consumers).

• To analyze the structure of the soyfoods industry in terms of the manufacturers involved, the types of soyfoods they market to end-users, and the overall industry environment that affects manufacturers in their efforts to market soyfoods.

CONTRIBUTION OF THE STUDY

BCC seeks to provide insight into one key question: How, and with what types of soyfoods, can manufacturers best satisfy processor and consumer demand for products that promote good health?

• Discusses each type of soyfood in terms of its uses, functions and functional value, nutritional value, health benefits, and applications.

• Suggests how consumer perceptions that a healthful diet promotes good health will influence consumers to think about soyfoods that reduce fat and caloric intake and increase nutrient intake from plants/vegetables.

• Analyzes such factors as changing consumer consumption patterns, media messages about soy’s health benefits, and the role of the internet in educating consumers about soy, and how they influence perceptions of soyfoods as healthful products.

• Examines the driving forces, such as regulations about health claims, technological improvements to the soybean and soy ingredients, price and availability, and how they affect processors’ selections of specific types of soyfoods.
• Looks at the fragmented soyfoods industry, how manufacturers respond to the needs of food and beverage processors and retailers, who in turn, are seeking to satisfy the changing needs of both mainstream and niche consumers.

SCOPE AND FORMAT

This report was confined to examining soyfoods consumed by people, and eliminated any discussion of its role in animal health or industrial applications. Further, soyfoods were discussed only in terms of manufacturers' sales to food and beverage processors and marketers who sell to retailers, and not to food service operators.

Manufacturers' sales are defined as wholesale sales of soyfoods to end-users -- food and beverage processors for use by themselves or as ingredients, and to various types of marketers who sell to retailers who then sell directly to consumers.

The first section of this report deals with whole soybean products; the second with soy ingredients; and the third with soyoil products. In each section, there is a description of the types, uses, functions, health benefits and applications, followed by the industry structure which includes market influences, driving forces, most active manufacturers, market leaders, and the industry environment.

METHODOLOGIES

Within each section, there are manufacturers' sales estimates and projections for each type of soyfood, soyfood by application, and by end-user -- processors and retailers.

INFORMATION SOURCES

BCC first conducted an extensive review of the secondary literature, with materials gathered from print and online sources: trade journals and magazines, trade and professional associations, government and industry sources, product literature, company materials and company websites. This review was followed up with some one hundred telephone interviews with personnel in sales, marketing, technical, research and development, customer service, and quality control.