Consumers are becoming increasingly aware of and concerned about the use of artificial ingredients in the products they and their families use. Cosmetic and food manufacturing companies are responding to this by accelerating the switch to natural ingredients. Despite strong findings that synthetic ingredients are perfectly safe, consumers are unrelenting in their ever-increasing attention to ingredient lists. In early March, Nestlé announced that it had eliminated artificial flavors, colors, and preservatives in the United Kingdom in response to consumer demands for natural ingredients. Even as natural ingredient demands have grown, sourcing these materials has only become more challenging to manufacturers. Higher production costs, volatile feedstock price and supply, and quality control make natural materials a fickle link in the supply chain.
A look into the pharmaceutical market for natural ingredients can provide some insight on the challenges faced in the food, flavoring and fragrance markets. A CBI Market Survey identifies two predominant influences on the prices of natural ingredients: quality and economics. The economic factors include the cost of production and the existence of synthetic substitutes. Quality factors include the point of origin, crop quality, methods of extraction, concentration of the active ingredients and purity. Natural materials from developing countries offer favorable economic factors, but this decision must be balanced with the loss of control over quality and transparency in ingredient sourcing. Natural materials must be grown and processed properly in order to avoid contamination from pesticides or concentration of toxic botanical constituents.