Where next for natural sweeteners? In conversation with Layn USA
Monk fruit extract prices have fallen by 30% in the past three years, while breeding programs to enable twice-a-year [as opposed to once-a-year] harvests and increase the percentage of Mogroside V - the sweet component - in the fruit, could bring prices down another 40% in five years, Layn USA president Elaine Yu told FoodNavigator-USA.
“Over the past five years, we have increased the percentage of MogV from 0.3% to 0.5%, which might not sound like a lot, but it’s almost doubling what’s there. We hope over the next five years to double the percentage again to get to 1%,” which could be game-changing from a cost perspective, she said, coupled with other initiatives Layn is developing, including improved freezing capabilities and storage capacity, enabling it to store monk fruit for longer before processing.
By expanding cultivation of monk fruit – which currently only grows in one region of China (Guilin) - to neighboring provinces with a similar environment and climate, Layn has also addressed concerns that too much supply is concentrated in too small an area, she said.
“Pilot programs have been conducted, and validated that the fruit quality and yield in these other regions are similar to that in Guilin.”
On the regulatory front, an application has also been filed to secure approval to sell the sweetener in Europe, she added.
Consumers want to see stevia leaf extract on the label
When it comes to stevia, Layn has also been developing varieties with higher percentages of the minor glycosides Reb C, D and M, said Yu. “We’re able to do enzymatic conversation to get to these glycosides, and we’re also looking at fermentation, but we’re definitely leaning more towards natural selection from the leaf, because I think most consumers want to see 'stevia leaf extract' on the label, not 'steviol glycosides.'
“Our fermentation project is still in its early stages because if that is the way the industry goes we want to have those options available as well, there should be a market for both.”
“In 2016, Layn contracted and purchased approximately 40% of the raw monk fruit available to the global high intensity sweeteners market. This is more than double the second largest monk fruit extractor.”
Elaine Yu, president, Layn USA
From a regional perspective, Layn sees growth opportunities in multiple markets, particularly in Latin America, where the company has recently been developing a new stevia growing region (in Guatemala), from which commercial quantities of stevia leaf extract will be available in Q3, 2018, she said.
“In China, there’s only one harvest a year, whereas in central America, you can have multiple harvests a year. We will also be offering organic options.”
When it comes to sweetness, she said, every country is different, but there is a definite trend in Latin America to have sweeter-tasting formulations.
“It’s so fascinating how each markets have different taste profiles. In Latin America, they want things even sweeter than they are in the US, where things already seem much too sweet for me as I come from China where things generally are not as sweet.
“In Latin American markets, people are also accustomed to the taste of cane sugar, not high fructose corn syrup or artificial sweeteners, and that’s the taste they expect when they use natural sweeteners. Take Coca-Cola in Mexico and Coca-Cola in the US, it has a different formula and sweetness profile. From a cost perspective, though, there are advantages as they are comparing everything with sugar, not with sucralose, for example, so you can actually make savings by cutting down on sugar and using stevia.”
Around 70% of Layn Corp’s revenues are derived from natural sweeteners and flavors targeting the food and beverage industry, with the remaining 30% derived from botanical extracts (eg. Olive leaf, magnolia bark, grape seed etc) targeting the dietary supplements, nutraceuticals, cosmetics and pharma industries.
The sweeteners and flavors portfolio includes:
- Monk fruit extract
- Luo han fruit concentrate
- Stevia leaf extract
- Glucosyl steviol glycosides (classified by FEMA as natural flavors)
- Sweet blackberry leaf extract (which masks bitterness and enhances sweetness)
- NHDC - neohesperidin dihydrochalcone (citrus derived flavor enhancer)
- Phloretin (apple extract)
- Proprietary blends of Reb-A and monk fruit extract
The formulation challenge
The challenge with stevia has always been that there is not a one size fits all solution, she said, with different approaches required for every application, even within the same category (eg beverages) whether it’s cola, flavored water, protein beverages, lemonade and so on. “That’s why working with natural sweeteners is so fascinating and so demanding.”
We’re increasingly dealing directly with food and beverage manufacturers
Based in Guangxi Province, China, where it has recently significantly expanded its manufacturing capabilities, Layn has recently opened a global innovation center in Shanghai, and has offices all over the world, in Europe, North America and Latin America, said Yu.
“We started out as a botanical extraction business in the mid-1990s as we were located in a part of China with a lot of natural resources – monk fruit, sweet blackberry leaf, gingko biloba and so on – with focus on dietary supplements, but now we’re evolving from a multi-product dietary ingredients company to a natural sweetener and flavor company targeting the food and beverage industry.
“We’re also vertically integrated; we supply farmers with our seeds and seedlings, train them in our standardized cultivation process, and monitor everything, from water usage to pesticide use.”
While Layn has a strategic relationship with Cargill (it has been supplying Cargill with stevia for several years), it is now “increasingly dealing directly with food and beverage manufacturers,” said Yu.
“I think people like the fact that we are not just a stevia company, we also have monk fruit and we have flavor enhancers and taste modulators and applications experts that can work with our clients to deliver customized solutions around the world.”