OPINIO
Trade4go
Jul 29th, 2024
Original content
Host: Gabriela Cabezas - Global Market Analyst - Ecuador
Speakers: Benjamin Lategan - Global Market Analyst - South Africa
Avelyn (Sun Jae) Lee - Associate - HQ
Alper Akkurt - Global Supply Chain Manager - Türkiye
Agenda:
In July, Tridge hosted an in-depth webinar that explored the dynamics between cold-pressed and refined oils in today's market. This comprehensive session delved into the latest trends, consumer preferences, and the unique attributes of each oil type. Tridge experts provided valuable insights into the production processes, nutritional benefits, and market performance of cold-pressed and refined oils. The webinar also covered how these oils differ in taste, shelf life, and culinary uses, offering a detailed comparison to help participants understand their respective advantages and limitations. The insights shared aimed to enhance their understanding of market dynamics and consumer behavior, ultimately supporting better business strategies and healthier lifestyle choices.
According to Benjamin Lategan’s presentation, cold-pressed oils are extracted mechanically at low temperatures, preserving natural nutrients, antioxidants, and flavors, resulting in a pronounced taste, shorter shelf life, and nutrient-rich profile. They are ideal for low-heat cooking, salads, dressings, and no-heat applications due to their rich flavor and high monounsaturated and polyunsaturated fats, including omega fatty acids. In contrast, refined oils are processed using chemical solvents and high heat, followed by extensive refining to remove impurities, odors, and colors, producing a neutral flavor, clear appearance, and longer shelf life. However, refining reduces their nutritional value and may introduce chemical residues and trans fats, making them suitable for high-heat cooking and commercial food production.
Lategan also highlighted broader market dynamics, such as the impact of the clean label movement, the balance between premium pricing versus cost and convenience, and the expansion in product varieties driven by innovation in processing. With growing health consciousness, consumers are increasingly seeking sustainably sourced and ethically produced oils. This shift influences market trends as producers and retailers adapt to meet the demand for healthier, more transparent products while navigating the complexities of oil production and consumer preferences.
Figure 1: Cold vs Refined Oils Application Method
Source: Tridge
The second part of the presentation elaborated on how consumers increasingly seek transparency in their product choices, preferring clean labels with minimal ingredients and processing. Cold-pressed oils align with this trend, offering natural, additive-free products that often come with detailed origin and production information, appealing to those interested in sourcing and production methods. These oils typically command higher prices due to perceived health benefits and labor-intensive extraction processes, often marketed as artisanal or gourmet products. In contrast, refined oils are more affordable and a household staple, with innovations like vitamin D fortification and omega-3 enrichment. The market is expanding to include diverse cold-pressed options from seeds and nuts and infused and blended oils that balance health benefits and cooking performance. Trends show a shift from trans fats and introducing healthier refined oil alternatives. In contrast, cold-pressed oils have grown in popularity for their health advantages and eco-friendly, ethically sourced practices.
Figure 2: Various Infused Oils from Fusells Brand
Source: Fussels
Besides presenting, Lategan also participated in the panel discussion, during which panelists Avelyn (Sun Jae) Lee and Alper Akkurt answered questions from host Gabriela Cabezas. Lee opened the panel discussion with answers to the role of marketing and labeling in shaping consumer choices. Lee gave insights on how South Korean olive oil brands often highlight their products' Spanish origins on their packaging, using phrases like "From Spain" and "Product of Spain," along with images of the Spanish flag, due to a strong preference for Spanish olive oils. This favorable perception makes South Korea an attractive market for Spanish suppliers. Similarly, Japan emphasizes the origin of olive oil packaging but offers a more diverse selection, including oils from Australia, Greece, and Italy. Akkurt elaborated on the matter, confirming that marketing and labeling are crucial in shaping consumer choices, particularly in the oil market, where effective strategies like social media campaigns, influencer partnerships, and educational content can significantly influence preferences. In Türkiye, the rising popularity of traditional and locally-produced olive oils is driven by marketing that highlights their cultural heritage, health benefits, and quality. Tridge's market intelligence services can help producers understand consumer trends and develop targeted marketing and transparent labeling strategies to communicate their products' unique value propositions, such as health benefits and sustainability certifications. Lategan confirmed the panelists’ view, and pointed out parts from his presentation.
In discussing how health and sustainability concerns influence the oil market, Akkurt underlined that these are significant drivers in the oil market today, influencing production and consumption patterns. Consumers increasingly prefer healthier oils, like cold-pressed varieties, which retain more nutrients and natural flavors due to minimal processing. In Türkiye, the demand for organic and sustainably produced oils is rising, reflecting global trends toward healthier eating habits. On the sustainability front, consumers are seeking oils produced with environmentally friendly methods, sustainable sourcing, and ethical labor standards. Tridge’s services, such as supply chain transparency and sustainability assessments, can help Turkish producers meet these demands by providing insights into sustainable practices and consumer preferences, enabling them to adopt eco-friendly techniques and effectively communicate these efforts through marketing and labeling. Lee added that health-conscious consumers in Asia, particularly in China, are driving an increasing demand for European olive oils. This trend is attributed to rising incomes and a growing interest in healthy eating, allowing more people to afford the relatively expensive olive oil. According to the International Olive Council (IOC) data, Chinese olive oil consumption has surged from 12,000 metric tons (mt) in the 2008/09 crop year to 42,500 mt in 2022/23. Correspondingly, Spanish trade data reveal that exports of virgin and extra virgin olive oil to China rose from 3,638 mt to 27,172 mt over the same period. Notably, South Korea, China, and Japan rank as the 9th, 14th, and 17th largest importers of Spanish olive oil, respectively.
Finally, in discussing market growth and evolution for the next five to 10 years, Lee shared her stand that despite the steady demand and preference for high-quality European olive oils, their high prices have significantly burdened consumers and contributed to price increases in related products, such as chicken, in South Korea. This has led to higher costs in chicken franchises and prompted consumers to switch to cheaper alternatives. For instance, the price of CJ CheilJedang olive oil at significant retailers has risen by 33.8% since the beginning of Jul-24. However, as these oils become more premium, they might be increasingly sold as gifts during New Year or traditional holidays like Chuseok in South Korea. Akkurt believed that there will be an increased demand for premium, health-oriented oils, particularly in Türkiye, where high-quality, cold-pressed olive and sunflower oils will become more popular. Sustainability will become even more critical, with consumers favoring brands prioritizing eco-friendly practices and transparent supply chains, necessitating investments in sustainable farming, renewable energy, and waste reduction. Technological advancements in production and processing will enhance oil quality and variety, while blockchain technology may improve supply chain transparency. Digital marketing and e-commerce will play a more prominent role in reaching and educating consumers, with online platforms becoming essential for producers to connect with global buyers. Tridge’s comprehensive market analysis and digital platforms can help producers in Türkiye stay ahead of these trends by providing actionable insights and facilitating direct connections with global buyers.
Click here to view the webinar recording, or click here to see the presentation slides.
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