2020 Asia Pacific Food and Beverage Trends


From the rise of functional beverages to prioritising food safety, here are seven trends set to dominate the Asia Pacific food and beverage market this year

KerryDigest Fast Facts:
  • Changing consumer behaviours and global events are constantly shaping the way food and beverage trends evolve in Asia.
  • From functional ingredients to sustainable packaging and local cuisine, we’ve identified seven priority areas for product development.
  • Because Asian culinary trends, ingredients and cooking techniques are now influencing global markets, these trends may also turn up in products outside of the region.

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KerryDigest Full Scoop:

Although we’re less than halfway through 2020, the trends that were emerging at the start of the year have been wholly disrupted by COVID-19. As markets settle, restaurants and retailers reopen and consumers begin to regain confidence and less restrictive mobility, we’re getting an updated picture of current consumer demand.

Taking stock of how the year’s food and beverage trends are evolving across Asia Pacific (APAC) is one important way for businesses to stay ahead to capture consumer interest and future-proof their product lines. Our local consumer insights and market research teams did an expert analysis of growing 2020 Asia Pacific food and beverage trends. Here’s what we found.

Plant-based products can grow more, if the price is right
The plant-based trend has gone beyond just meat alternatives. There are now plant-based ice creams, protein bars and even cookie dough. While demand seems to be on the rise, there is still variation between and within markets, especially when it comes to market maturity and price points.

For example, in April 2020, Starbucks rolled out a plant-based food and beverage menu in China across its 4,300 stores. Plant-based products have visibility in Australian markets, too, but in developing markets like India, the majority of the population are unlikely to switch to plant-based meats as they consider meat a weekly or bi-weekly indulgence.

In Singapore, price point is a concern, especially when comparing a SGD9.50 pack of sausages and its SGD20 plant-based counterpart. As a result, plant-based product consumption is often restricted to a small segment of higher income urban professionals. For the majority of the population, purchasing plant-based product will come down to price, safety and sensorial value. If manufacturers can deliver these, the take-up will steadily increase. Having said that, there may also be a change in demand as consumers turn to meat alternatives post-COVID-19, due to heightened food safety concerns.

Fruit-flavored and functional beverages are gaining ground
Floral-flavored beverages are already in the mainstream and are considered key flavors in the industry. This year, we are seeing an emergence of fruit-flavored beverages, fermented beverages and beverages with natural and functional ingredients. These trends are experiencing a high growth rate and are included in a significant percentage of new beverage launches.

As consumers become more conscious of what goes into their bodies, there is an increased preference for beverages that offer perceptions of wellness and functionality via ingredients like matcha, moringa, ginseng and kombucha, or oat-based beverages that are based on or have oat and goji berry. Consumers may look for indicators that a product is clean label or has other alternative callouts such as gluten-free, dairy-free, keto and more. We also see a growing trend towards natural replacements, such as substituting white sugar and less healthy sweeteners with manuka honey and black sugar.

As consumers become more conscious of what goes into their bodies, there is an increased preference for beverages that offer wellness through added functionality.asian-trends-quotes-img1

Beverages are now more than just thirst-quenchers, consumers also view them as a form of indulgence and a health booster. Innovation in the beverage space has allowed manufacturers to offer not just taste, but also a nutritional, functional and sensorial experiences as well.

Consumers are willing to pay a premium for beverages made with high quality and functional ingredients that meet their needs. They are also looking at convenience—for instance, yoghurt and protein drinks now function as meal replacements in APAC’s fast-paced societies.

Environmentally-friendly is the way to go
The traditional sustainability agenda is typically framed as an ethical sense of responsibility to the world. But consumers in Asia Pacific are driven to protect the environment due to the personal stakes they have in the issue. Given the often visible environmental degradation, many feel an urgent need to reduce the risk they personally face from the environment, such as air pollution, water pollution, landfills and soil contamination.

Asia is a hotspot for plastic pollution, and plastic is something that consumers use—and in many cases, dispose of—every day. Research in the journal Environmental Science & Technology indicated that salt sold in Asia contains the highest level of plastic contamination in the world. In addition, in 2014, China’s Ministry of Environmental Protection and the Ministry of Land Resources reported that 20% of China’s total farmland used for agriculture was already hazardously polluted, and the problem has continued.

Therefore, how food is produced and processed is an important factor gaining prominence in consumers’ minds, and there is a blurring of the lines between health and environmental concerns. Kerry’s recent cleaner label study showed that 55% of consumers in Asia Pacific, Middle East and Africa (APMEA) are likely to purchase sustainable food because they believe it is healthier.

Innovation also helps environmentally-friendly alternatives hit the mainstream. When you innovate against waste, you’re not only minimising your carbon footprint, you’re also addressing other concerns like excess packaging and single-use plastics.

According to Mintel, the eco-friendly movement has certainly influenced packaging in beverages, with 23% of new beverage launches in 2019 having an environmentally-friendly packaging claim. According to food and beverage experts in the region, there is a rapidly rising demand for sustainable packaging for take-aways and to-go food and beverage.

According to food and beverage experts in the region, there is a rapidly rising demand for sustainable packaging for take-aways and to-go food and beverage.asian take away food

Health and wellness continue to drive consumer preference
Lifestyles that lead to higher incidences of non-communicable diseases, a significant ageing population and the globalisation of culture and technology are influencing consumers to adopt a more proactive approach to health and wellness. Consumers in APAC are now focusing on holistic health in addition to physical health, and there is a growing desire for more natural forms of health and wellness delivered through diet, exercise and general lifestyle.

As such, people want convenient, functional and fortified foods that come with benefits ranging from preventing cognitive decline to building mental alertness, rejuvenation, mood enhancement, gut health, a focus on beauty and boosting energy. Post-COVID-19, we anticipate seeing a renewed and increased focus on preventive health with rising demand for products that help address key concerns including immunity, stress and detoxification.

Weight management is also a leading factor in the health and wellness charge. Obesity is an increasing concern across the region: per the Kerry cleaner label study, 41% of consumers in Asia Pacific are categorized as overweight or obese, up from 35% in 1990. Looking good and feeling good are now a priority, especially as consumers in the region are increasingly aware that being overweight may make a person more at risk for chronic diseases such as diabetes, cardiovascular diseases and certain types of cancer.

Data shows an almost direct correlation between sugar intake and obesity rates. However, while mature markets like Australia and Africa have shifted from fat reduction to carbohydrates and sugar reduction, Kerry’s cleaner label study showed that fat was the primary concern across all categories and most markets in the greater APMEA region. In the survey, 53% of consumers said they would be willing to pay a premium for products with no- or low-fat claims.

Across Asia, governments are pushing to reduce sugar consumption. For instance, while data shows that sugar consumption from drinks has decreased in Singapore, sugar consumption from food has gone up. That said however, pre-packaged sugar-sweetened drinks remain the single largest source of sugar. In response, the Singapore government’s recent measures to control obesity and promote healthier lifestyles include the introduction of Nutri-Grade, a new grading system for pre-packaged beverages, to be implemented by end 2021. The Nutri-Grade system aims to increase awareness of the amount of sugar present in what people eat and drink.

Sweetness remains a key pillar in local flavor preferences across APAC, with sugar as the key ingredient. Manufacturers must focus on solutions that can substitute sugar and fat without compromising taste and mouthfeel.

Growing demand for authenticity and provenance
Providing provenance information is one way to address concerns related to food safety, health and environment. It reassures consumers when they know where their food comes from and they also get a sense of community when they support local products. But given the scale of the APMEA region, relevance and interpretation of provenance varies from market to market.

There is a rising movement in some markets to trust and take pride in local produce, viewing it as safe, good for you and sustainable. Consumer motivation can also stem from wanting to help support local communities, as is the case in Japan, or because the local produce is seen as being of higher quality, as in Australia. This is becoming increasingly visible even in markets like Indonesia, where President Joko Widodo actively encourages Indonesians to support local businesses and frequently introduces local products on his video blog as he travels across the country.

In countries with a history of food scandals, imported food products still remain an important symbol of safety because consumers in these markets do not always trust their own local goods. However, in April 2020, analysts observed a change in consumer behavior that suggests localism is on the rise in China, with 76% of consumers in a Mintel report claiming they’d like to support local brands after the COVID-19 outbreak. A majority have strong feelings of patriotism after the lockdown and the pandemic has also changed consumers’ confidence in foreign products.

Renewed appreciation for traditional ingredients and diets
Local production is also resonating more with consumers due to a growing belief that health issues are caused by a divergence from traditional practices, and that traditional foods and diets are healthier than imported globalised counterparts.

Local players can thus focus on traditional food, traditional ingredients and traditional cooking methods. One example is Dashi soup stock. It is produced locally in Japan and is free from artificial additives and table salt, which also addresses consumer concerns about salt and chemical additives.

In a 2015 study by The Lancet Global Health, which mapped out eating patterns across the world, the highest quality overall diets were found not in wealthier developed countries, but in 10 markets in sub-Saharan Africa. Similarly in APAC, “good, healthy” food that includes local ingredients and traditional diets offers a healthier and cheaper alternative to Western diets, especially for the lower income consumer segment.

As the consumer response to COVID-19 continues to evolve, we are seeing an increased interest in natural ingredients and traditional recipes and cooking methods perceived to help boost health and immunity.

As the consumer response to COVID-19 continues to evolve, we are seeing an increased interest in natural ingredients and traditional recipes and cooking methods perceived to help boost health and immunity.asian lettuce wraps with beef

Trends coming from Asia are now making their way to the West
Historically, food and beverage trends tend to originate and spread from the West. Thanks to digital advances and social media, consumers are becoming savvier and more well-informed, making it easier for them to discover what’s trending around the world. The younger generation is also more receptive to multicultural cuisine, allowing Asian flavors to penetrate new markets.

Today, trends no longer move from West to East but also from East to West. For example, traditional Asian ingredients and products like kombucha and turmeric are currently enjoying popularity in the West.

This year, we are seeing Asian influences everywhere. Korean cuisine continues to influence the Southeast Asian and Australian markets; according to a Japanese and Korean Trends report by Nielson in 2018, the Korean food trend—for the first time ever —has overtaken the Japanese food trend in Hong Kong and is projected to grow even more.

Kerry’s 2020 Taste Charts also indicate that Asian flavors including ginseng, fenugreek, gingko, moringa and cumin are enjoying popularity in Europe, while in the U.S. consumers are gravitating towards lemongrass, cardamom, yuzu and matcha.

To learn more about how COVID-19 is affecting the food and beverage industry, including changes in consumer preferences and purchasing behaviours, visit Kerry’s COVID-19 resource page.

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