The world looks to Japan for inspiration in functional foods or nutraceuticals – foods that offer health benefits beyond basic nutrition. Fonterra’s dairy ingredients have been quietly at the forefront of this revolution, helping to deliver benefits from satiety to longevity for consumers to live happier, healthier lives.
There’s a reason Japan is often called the birthplace of the functional ingredients industry – 1 in 3 people here will be over the age of 65 by 2030. It’s also home to some of the world’s longest-living people: there are some 90,500 centenarians – people over the age of 100.
This has led to dynamic innovation inactive ageing, and a strong demand for products that support well-being, mobility and combat cognitive decline. Think nutrition-packed ice cream or yoghurt containing milk protein probiotics, natural soluble fibre, and loaded with vitamins and minerals.
Japan is also by far the biggest consumer of cheese in Asia – cheese made from your grass-fed milk.
Your Co-op in Japan
Japan, alongside Korea, makes Fonterra’s North Asia business. It’s a critical market for the Co-op. North Asia is right on strategy when it comes to focusing on the high value business of functional dairy ingredients, specifically dairy protein.
Our business in Japan is a joint venture with Nissei Kyoeki (NSK). NSK holds the number one share in the Japanese protein ingredients market with strong R&D capabilities and an extensive sales network that enables us to further expand our Active Living & Paediatrics businesses.
At the helm is Tatsuo Kunimoto, who recently took over the reins as President from Yasuhiro Saito who remains an executive advisor after 18 years at the Co-op.
Functional ingredients are an innovative differentiator
Japanese consumers seek natural alternatives and are prepared to pay a premium for the promise of added health and nutrition benefits, says Kunimoto-san, adding that foods with functional claims typically retail at 1.5 times the price of ordinary foods.
“Topping the list is protein, and it would seem the more protein you can cram into a product, the better. ”
But taste remains fundamental for Japanese consumers. Japan is known for pushing the boundaries when it comes to new flavour combinations, from malted squid ink ice-cream to grilled lamb caramel.
“No matter how good a product may be for you, if it doesn’t taste right, it’s probably not going to cut it,” says Kunimoto-san.
Fonterra’s hero ingredients – Whey Protein Isolate (WPI), Whey Protein Concentrate (WPC) and Milk Protein Concentrate (MPC) – are ideal forfortification; a process where additional ingredients such as vitamins, probiotics or fibre are added to increase a food’s health benefits.
“They’re ideal because there’s little or no compromise on taste, appearance,or quality.”
Fonterra actively works with customers, technical experts in market, and our Fonterra Research and Development Centre (FRDC) in Palmerston North to meet exact customer requirements. This collaboration extends to having a Fonterra resource at customers’ R&D centres and likewise, a customer presence at Palmerston North to jointly develop the next big idea.
“Functional Ingredients are a thriving space and one where Fonterra has a clear competitive advantage. It’s our sonzai-igi – our reason for being,” says Kunimoto-san.
Here’s how our leadership in dairy science and innovation delivers high performance for our customers in Japan:
Protein Punch
Dairy and confectionery giant Meiji supports the health and wellness of millions of consumers across Japan and wider Asia. It’s MeiBalance Beverage –a high protein, nutritionally balanced drink helps consumers get extra supplements in their diet. Our MPC from Clandeboye, and WPC and WPI made at Clandeboye and Whareroa, helps to stabilise the formulation under acidic conditions,which is typically a challenge for high-protein foods.
Fit for Seniors and full on flavour
Customer Takeuchi Pharmaceutical recently launched a milk-flavoured protein powder, effective in combating sarcopenia-related muscle loss for Japanese seniors. Made to mix with coffee and tea, its solubility makes it a convenient choice for elderly. Regular protein denatures in hotwater, however our Whole Protein Concentrate (WPC) was able to solve this customer need.
Kunimoto-san comes to Fonterra with deep experience in consumer, food and beverage, and agricultural ingredient businesses across Japan and Korea. He’s also a qualified wine expert from the Japan Sommelier Association and sports a black belt in Judo.
