Top Ten Food Industry Trends for 2016

Monica Orrigo
January 4, 2016

Now’s the time for distributors and wholesalers in the food industry to get in front of some of the biggest food and beverage industry trends that could impact your business in 2016. Although this is a top ten list of food industry trends for the coming year, you could easily narrow it down to three major areas of emphasis: clean and healthy eating, ethnic food and artisanal, locally produced food, along with a trend toward safety and sustainability––both in terms of agricultural production and throughout the supply chain. Without further ado, here are our Top Ten Food Industry Trends for 2016.

Top 10 Food Industry Trends

1. Organic Foods

The organic food market segment has been growing rapidly for years. It is expected to continue its double digit growth, with some estimates indicating the segment should grow 14% between 2013 and 2018. The organic food movement should continue growing in popularity as consumers become increasingly aware of pesticides and genetically modified foods. According to Food Navigator, 81% of American families purchase organic foods at least some of the time. The biggest obstacle to further growth is cost of producing, supplying and purchasing organic products, so those that can balance cost with an organic approach are likely to find favor with consumers.

2. You-Name-It Free

Very few consumers have documented intolerances to ingredients such as wheat, gluten or dairy, but there is a public perception that foods free of these ingredients may be healthier, and the market for these products has grown as a result. The gluten-free product market segment, for instance, grew more than 34% in the years leading up to 2014, and is expected to continue to grow more than 19% through 2019.

3. All-Natural Ingredients

The all-natural ingredients market segment is a lower-cost, more easily sourced alternative to the organic and “Free” movements. Organic foods must be certified by the government as “organic” based on stringent requirements, whereas all-natural foods have more leeway in terms of the production and sourcing techniques. All-natural is often combined with organic in estimates of market share; finding market information about natural foods specifically can be difficult.

4. Healthier Beverages

The emphasis on health continues into the beverage segment. Tea and sparkling water instead of sugary beverages, and artisanal soft drinks are all expected to become increasingly popular in 2016. One reason for this shift is consumer desires to eliminate products such as high fructose corn syrup from their diets. Even big brand sodas, such as Coca Cola, are attempting to take advantage of this shift by marketing overseas versions of their products, such as Mexican Coke, which contain cane sugar and come in smaller, glass bottles.

5. Healthy Snacks

Along with the growth in organic, trend watchers are reporting an increase in snacking. Combine these two trends and you get this: healthy snacks are the fastest growing segment within the organic and natural foods markets. It makes sense. Americans have increased their snacking frequency over the last 5 years, with more people eating smaller meals and snacks throughout the day, versus fewer large meals.

6. Alternative Protein

Within the natural and organic foods segment, another quiet shift is going on – the shift away from traditional meat-based protein and towards vegetarian protein sources like quinoa, chickpeas and other plant-based protein. Vegans were once considered a small niche market, with only about 6% of Americans identifying as vegan. However, when combined with vegetarians (who may eat some animal based protein such as eggs and cheese) and those who identify as “flexitarian” (those who still eat meat, but are trying to eat less of it by combining meat with other plant-based protein sources) the market represents a significant growth opportunity. In all, between 26% and 40% of Americans identify as being somewhere along the vegan/vegetarian/flexitarian spectrum, making this a significant growth opportunity within the food industry.

7. Changing Tastes at Breakfast

Multiple trends are contributing to the shift in popularity away from carb-filled, cold breakfast cereals. Some ground has been lost to healthier, protein-rich breakfast options like Greek yogurt and steel cut oats. More ground has been lost by cereals to organic or gluten free breakfast options. And in other cases, cold cereal as a convenience food simply isn’t convenient enough for consumers that now opt toward eat-on-the-go options like granola or breakfast bars, or who are eliminating breakfast from their diets entirely.

8. Food Safety and Sustainability

In recent years, consumers have been very aware of large recalls of packaged foods such as the recall of Blue Bell’s entire product line. Given how damaging these kinds of food safety issues can be to company finances and reputations as well as consumer health, food distributors must make safety a primary concern. Consumers are also considering sustainability as part of their overall approach to food safety and health. This is part of what is behind the growth in trends like organic – consumers are increasingly beginning to understand the relationship between their food and how it is produced.

9. Ethnic Flavors

Ethnic foods such as Asian, African and Middle Eastern foods are predicted to have a big impact in 2016. In fact, between 2012 and 2017, sales of ethnic foods in grocery stores has been predicted to grow more than 20 percent. Some of this growth comes from purchases by immigrants from these regions, but even more of that growth comes as a result of more adventurous tastes in eating by the average American consumer.

10. Artisanal and Local Foods

From bread, to cheese, to soft drinks and convenience foods, the “artisanal” label is being put on more and more foods, but what does it mean really? Artisanal is a label that is intended to describe foods that require more time, care and are of higher quality than typical mass produced foods. Another similar label is “small batch,” which is also being used by more large brands as an alternative to organic foods. This is a segment to watch in 2016. In all, we think the top trends to watch in 2016 will be those that are focused around health and sustainability, whether these are labeled as true organic, or alternatives such as natural, sustainable or artisanal. Changing tastes due to changing lifestyles, such as the shift away from formal breakfast, and the expansion of consumer tastes to include more exotic flavors from around the world, will also be trends to watch. What food trends will you be watching in 2016? Tell us about them in the comments.