All aboard the collagen bandwagon
Christchurch-based Dairyworks is looking to develop new collagen and plant-based products as it eyes rising demand for health and wellbeing foods. Tina Morrison reports.
‘‘Everyone used to be bovine. But nowadays, people flex. They might have oat-based, they might have soy, and they could have dairy, all in a day.’’
Dairyworks chief executive TimCarter
Collagen is one of the major building blocks of bones, skin, muscles, tendons and ligament. But Consumer NZ says evidence for collagen supplementation is far from conclusive.
Dairyworks, whichmakes cheese, butter and yoghurt, is looking to develop new collagen and plant-based products as it eyes rising demand for health and wellbeing foods.
The consumer dairy business, which includes the Rolling Meadow and Alpine brands, was bought by NZX-listed Synlait Milk for $112 million in October 2019, and is looking to take advantage of the manufacturer’s connections and know-how to help achieve its aim of doubling its business over the next three years, by expanding its product range here and overseas.
‘‘We have some pretty big aspirations,’’ says chief executive Tim Carter.
Health and wellbeing is amajor consumer trend, particular after Covid-19, and anythingwhole-food, plant-based or organic is growing rapidly, he says.
‘‘We are seriously looking at collagen,’’ he says. ‘‘Collagen is a big trend.’’
Celebrity Khloe Kardashian has just partnered with United States collagen supplement company Dose & Co and is the firm’s global spokesperson. When the product launched in October she espoused the benefits of sprinkling pure collagen powder on her daily coffee.
Here inNew Zealand, premium dairy company Lewis Road released a collagen-infused milk this year, and Hawke’s Bay company Adashiko launched a Collagen Refresh premium bottled water thismonth.
Dairyworks is ‘‘seriously looking’’ at a yoghurt product which includes collagen to meet demand for foods that improve wellbeing, with potential benefits to the gut, bones, and immunity,
Carter says.
‘‘I think it’s probably a natural race for the dairy companies to be in there with collagen,’’ he says.
Dairyworks is agile and could get a collagen product to market in 12 to 16 weeks, comparedwith a big organisation that might take 12 to 18 months, he says.
However, claims around the benefits of collagen in food are controversial. The Ministry of Health’s advice service, Healthline, says collagen is one of themajor building blocks of bones, skin, muscles, tendons and ligaments, and is the ‘‘glue’’ that holds all these things together. While there aren’t many studies on collagen supplements, those that have been done show they may help improve skin texture and muscle mass, as well as reduce osteoarthritis pain, it says.
Lewis Road has copped some flak for its collagen milk, which was named among the ‘‘winners’’ at Consumer’s 2020 Bad Taste Awards.
Lewis Road initially claimed on its website that collagenwas ‘‘scientifically shown to regenerate joint cartilage’’.
Consumer said evidence for collagen supplementationwas far from conclusive and the claims were not approved under the Food Standards Code.
Lewis Road has since dropped the claims and apologised, saying a staff member ‘‘published the statement in error’’.
Dairyworks is looking into the claims around collagen as part of its scope and would be careful what it said in its marketing, Carter says.
Still, he says there is a ‘‘feelgood’’ factor to the product.
‘‘For whatever reason, consumers think there’s something in it,’’ he says.
It was similar to claims around the benefits from consuming milk which contains only the A2 protein, even though the claims were not proven, he says.
‘‘If it’s aboutwellbeing and it’s probablymore than a chance that it’s doing better forme, thenwhy wouldn’t you?’’ he says. Dairyworks is also actively considering plant-based products, consistent with Synlait’s strategy to do milk differently. ‘‘Everyone used to be bovine,’’ says Carter. ‘‘But nowadays, people flex. Theymight have oat-based, they might have soy, and they could have dairy, all in a day. It’s a trend that will last, so that’s a trend that we want to be in.’’ Dairyworks is engagingwith partners and is planning to have products on the shelf in the first half of next year, with potential across cheese, yoghurts and milk, he says. The company has already had success with other new products as time-pressured Kiwis branch out from their traditional purchase of a one kilo block of cheese and add more convenience foods to the shopping trolley.
Sales of its cheese slices were growing 16 per cent a year, outpacing the 2 to 4 per cent growth in the general cheese category. Its high-protein yoghurt, which includes a layer of fruit and amuesli topping, launched in October and is outpacing expectations with production stepped up to four times aweek from twice aweek. ‘‘The demand is there,’’ Carter says.
‘‘If you can meet consumer need, they’ll fly off the shelf.’’ Dairyworks has benefited from people spending more on speciality cheeses and butters since Covid as they increasingly dined at home and were looking for culinary inspiration.
Sales of fresh cheeses such as halloumiwere growing 12 per cent a year, while parmesan and mozzarellawere increasing by about 10 per cent.
‘‘People are treating themselves and probably also making special meals in the weekends,’’ he says.
The company launched flavoured butters in Australia throughWoolworths in July, and in New Zealand in September, to capitalise on the demand for culinary inspiration.
Carter expects the trend to continue for the next couple of years.
Growth in the company’s retail grocery business during Covid has offset a drop-off in food service sales, he says.
As well as expanding its range of products, Dairyworks, which sells its products in 16 markets, is targeting New Zealand, Australia, the Pacific and China for further growth.
The company expanded to Australia 18months ago and the country now makes up about 10 per cent of its business, but it’s growing at a rate of 300 per cent.
It has just reached a distribution agreement for the Pacific Islands, which should accelerate growth in that market.
In China, where it sells smallersized convenience and snack foods, it’s looking tomove from a distribution agreement to a partnership to grow the business at a far faster rate next year.
Right now, though, Dairyworks is gearing up for the busy summer season, with 30 per cent of its speciality cheese volume typically sold during December and January when there is a lot of entertaining.