Innovation pushed from flavour firms operating in this competitive sector brings food developers new opportunities to improve the final product as ICI flavour subsidiary Quest International, streamlined in May this year through the spin off of its food ingredients arm to Irish ingredients firm Kerry, targets the dairy industry with a new flavour system.
Made from milk and milk ingredients, the new product - 'Dairy Designer' - aims to satisfy dairy makers needs: fat content, shelf-life, nutrition and cost-effectiveness.
"As well as avoiding problems like off-notes and deviations in appearance, texture, aroma and taste," said Jacquel Kroon, a flavour development manager at Quest.
Early application tests have been highly successful, including cream cheese, vegetable fat ice cream and UHT skimmed milk, added Kroon.
The dairy sector is on the hunt for new ingredients that can help them spear the burgeoning functional foods industry, that has shown particularly strong growth in this domain.
In 2003, global sales of dairy products reached €211.5 billion, according to Euromonitor, with total value growth of 13.4 per cent from 1998 to 2003 underpinned by good growth in the dominant Western European region.
Probiotic drinking yoghurt has been the fastest growing dairy product in the last five years, thanks to its health benefits and convenient format that even allows it to cross sector boundaries to compete with soft drinks.
Market research by Euromonitor shows that probiotic 'little bottles' have grown by 52 per cent this year, reaching a retail sales value of £28 million, the highest growth in the core European markets. This compares to a decline in plain and natural yoghurts of almost 2 per cent.
Other novel ingredients being used by the dairy industry include those that lower cholesterol and although this is still a very new category, it looks set to grow fast. French firm Vedial launched a cholesterol-lowering drinking yoghurt early this year under the St Hubert Ilô brand, which was immediately followed by Danone's introduction in April of a new range of anti-cholesterol yoghurt, sold under the brand Danacol.
In a deal worth £249 million (€369m) ICI earlier this year sold the food ingredients arm of its struggling flavour and fragrance business Quest to acquisitive Irish ingredients group Kerry, giving the flavours operation room to concentrate on the core business.
Quest unveiled a new €25 million flavour creative centre in Naarden, the Netherlands in May this year. Quest has launched the new dairy design system across Europe and North America, with Asia-Pacific slated for 2005.