Pro-health Consumers in U.S. Stock Organic Tortilla Products amidst COVID-19 Outbreak
Grocery shopping has become stressful for individuals amidst the ongoing coronavirus (COVID-19) era. Since social distancing has become the norm, trips to the grocery store have become more cumbersome for individuals. However, the organic tortilla market is experiencing a spike in snack sales. This trend is prominent with pro-health consumers who are using frozen foods such as whole-wheat tortillas to replace sandwich bread and create more space in refrigerators. Since consumers have become conscious about maintaining high immunity levels, they are driving the demand for organic tortilla products such as multigrain chips and soups.
Pepsico-a U.S. multinational food company, is experiencing increased sales of its Tostitos tortilla chips. Hence, companies in the organic tortilla market are increasing their production capabilities to manufacture tortilla chips and taco shells.
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Multigrain Tortilla Chips Help Strike Balance between Health and Indulgence
Since tortilla products are made primarily from wheat or corn, health-conscious customers prefer organic tortilla chips. For instance, Mission Foods— a subsidiary of the U.S.-based tortilla manufacturing company Gruma Corporation, is increasing its marketing efforts to promote its Organic Multigrain Tortilla Chips packed with non-GMO (Genetically Modified Organism) ingredients. Companies in the organic tortilla market are complying with regulations laid down by the USDA (United States Department of Agriculture).
Companies in the organic tortilla market are increasing efforts to strike the right balance between health and indulgence by introducing freshly baked tortilla chips. They are using consumer-friendly ingredients such as sea salt and multigrain ingredients including chia and quinoa to meet the requirements of the millennials. Manufacturers are also introducing recipes of creamy baked bean dips in order to increase the uptake of organic tortilla chips.
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Growing Latin America Culinary Influence in U.S. Benefits Retail Sector
Organic tortillas and tortilla chips have become a staple in the U.S. retail and foodservice sectors. Hence, companies in the organic tortilla market are tapping into incremental opportunities in the retail and foodservice sectors in order to broaden their revenue streams. As such, the organic tortilla market is projected to reach a value of US$ 34.5 Bn by the end of 2030. Apart from retails, manufacturers are leveraging business opportunities in schools, institutions, and military environments to increase their product sales.
The steadily increasing Latin America culinary influence across the U.S. explains why the stakeholders in the retail sector are maintaining robust supply chains. One of the top trends in the market for organic tortillas is increasing focus on healthy snack deliverables.
Rise in Demand for Organic Tortilla as Clean-label Ingredients Earn Faith of Consumers
Clean label and exciting flavors of organic tortilla products are generating value-grab opportunities for manufacturers. This is evident since the organic tortilla market is slated to expand at a CAGR of 7.6% during the forecast period. Manufacturers use reducing agents such as L-cysteine or sodium metabisulfite in order to obtain appropriate dough rheology. However, many consumers are unable to understand the importance of such ingredients written on labels, which is likely to impede the growth of the organic tortilla market. Hence, manufacturers are using clean-label ingredients such as dried yeast and enzymes in order to simplify the ingredients list for consumers and increase the availability of healthy organic tortilla products.
Since dried yeast and enzymes mimic the properties of reducing agents, manufacturers are utilizing these clean-label ingredients to strike the right balance between health and indulgence.
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Analysts’ Viewpoint
Organic Tortilla Market: Overview
- The global organic tortilla market value is estimated to reach ~ US$ 16.6 Bn in 2020, finds Transparency Market Research (TMR) in a recent study. According to the report, the organic tortilla market is anticipated to reach ~US$ 34.5 Mn by 2030, at a CAGR of 7.6%.
- More than 60% of the global population lives in urban areas. Owing to the hectic lifestyle adopted by most consumers, unhealthy eating habits, and deteriorating health conditions, the working population in metropolitan cities is searching for food products with high-nutrition and convenience. Organic tortillas are on-the-go or convenience food products that the consumers prefer. This factor is expected to aid in the growth of the organic tortilla market in the current scenario.
Organic Tortilla: Market Frontrunners
- Fresh organic tortilla shows profitable demand, owing to rising food adulteration incidences and growing consumers focus on good health and wellness, and is highly preferred compared to frozen organic tortilla
- APEJ is expected to show high growth rate of 10% in the organic tortilla market during the forecast years. Growing urbanization, particularly in Australia and South Korea is expected to create substantial growth opportunities for the organic tortilla market in the near future.
- Presently, North America holds a large share of 37.3% of the global organic tortilla market. The high demand for organic food products can be attributed to the rising health and wellness trends, thus fueling the growth of the organic tortilla market in the region.
- In terms of distribution channel, B2B accounted for a large share of ~43.5% in 2020 of the organic tortilla market. Majority of organic tortilla producers prefer to channel their products through retail units.
- Among product types, organic tostadas tortillas are expected to witness high growth during the forecast period with a CAGR of 12.4%
Organic Tortilla Market: Trends
- Hectic and busy lifestyle of consumers has changed their eating habits driving them toward healthy and natural eating options. Consumers are opting for organic ingredients, which are beneficial to their health and wellness. However, consumers are also becoming more attentive about their snacking choices. They are choosing healthier foods containing nutritious and natural ingredients. Consumers are gradually shifting toward snacks that offer clearer and cleaner labels. Organic tortilla fulfill the demand for healthier, cleaner, and natural snacking and thus, are expected to witness rising demand in the near future.
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Rising Demand for Organic Food Products to Offer Growth Opportunities to Organic Tortilla Manufacturers
- Organic foods are high in demand from health conscious consumers around the world, as they do not contain any chemical additive or any artificial ingredient. Consumers now have access to smart labels through which, they can track the journey of a product and check it against their individual qualities.
- Consumers today are becoming more selective about what they eat, therefore driving the demand for more natural and organic food. Hence, transparency of products, incorporation of natural ingredients free from status, and nutritional levels has observed a shift in food trends. This is driven by buyers’ ever-increasing demand to understand the product’s background– from what the ingredients are and from where they were sourced. This showcases high preference for organic tortilla over conventional tortilla.
Organic Tortilla Market: Strategies
- Key players operating in the global organic tortilla market are focused on innovation and the launch of new products. This is expected to make consumers more inclined toward innovative organic tortilla products.
- Players in the organic tortilla market are trying to maintain sustainable position in the market through partnerships and joint ventures. For instance, Rudy’s Tortillas entered into a partnership with Teasdale Foods, Inc. to expand its distribution network and focus on expanding its production capacity.
Target Region for Organic Tortilla Market
- Rising demand for free-from and organic food products in developed economies such as the U.S., the U.K., Australia, and EU-4, among others, is increasing at a high rate. This can be attributed to the rising health & wellness trend and demand for transparency from consumers. Thus, the organic tortilla market in these developed economies is growing faster than the conventional tortillas that are available in the market.
- The demand for organic tortilla in Latin America, which is the place of origin of tortillas, is growing due to awareness for clean label products in countries such as Brazil, Mexico, Argentina, etc. The growth rate for organic tortillas is very high in Asia Pacific, but conventional tortillas are still being consumed as the price of organic tortilla is slightly higher.
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Organic Tortilla Market: Players
- The global organic tortilla market is consolidated with a few market players holding a large share of the market. Some of the key players in the organic tortilla market are
- GRUMA
- S.A.B. de C.V
- Tyson Foods, Inc.
- PepsiCo
- Olé Mexican Foods Inc.
- Easy Foods, Inc
- Mi Rancho
- Arevalo Foods Inc.
- Azteca Foods, Inc
- Rudy’s Tortillas
- Tortilla King Inc.
- Fiesta Tortilla Factory Inc.
- Los Amigos Tortilla Manufacturing, Inc.
- Rudy’s Tortillas
- Franco Whole Foods, LLC
- La Tortilla Factory
- Eagle Foods Australia
- Catallia Mexican Foods,.
