Soy Market Analysis

Is the market ready for soy?


Soy protein cost effectively helps to meet consumers’ demand for low-fat healthful products that also taste good. More consumers are specifically looking for soy protein on the label, thanks to recent findings that illustrate soy protein’s helath benefits. The fact is, consumers realize they have a whole new soy today.

Retail Opportunities

Approximately 57 percent of U.S. shoppers are considered to be “very” or “somewhat” health-conscious and have reduced fat in their diets for health reasons, according to the Prevention / Food Marketing Institute’s (FMI) “Shopping for Health” 1996 survey. And they are willing to pay for it. According to the survey, 73 percent of shoppers are willing to pay more for healthy versions of foods they eat regularly. Even more revealing is that 71 percent of all U.S. shoppers say their diets could be very or somewhat healthier than they are now. (See Figure 3).

Fat is one of the top concerns for these health-conscious shoppers. Prevention/ FMI reports that 72 percent of consumers began purchasing specific foods because of issues related to the product’s fat content (see Figure 4).

Although dietary fat intake remains the top nutritional concern of consumers, Food Technology (July 1996) reports that Americans are fundamentally shifting their approach to nutrition, moving from passive to proactive as they begin to seek out foods or ingredients that offer specific health-promoting qualities or benefits.

This trend also bodes well for soy protein, which contains some of the phytochemicals, such as isoflavones, receiving the most attention for their health promotion capabilities. For example, media coverage of genestein, an isoflavone found in soy, climbed 600 percent in one year.

As interest in the $76.89 billion nutraceuticals market grows, soy protein is a promising ingredient for formulating foods with specific health or medical benefits. As the Food Technology report summarizes: “While scientific support for the health benefits of individual ingredients is being accumulated, manufacturers might consider adding promising food ingredients to products.”

Twenty-six million people are seeking out soyfoods specifically. According to Soyatech, Inc., the total soyfoods market* (excluding soy oil), is at about $1 billion. Soyfood sales have experienced a steady sales growth of 10 percent to 15 percent during the past few years. Sales soared by about 30 percent in 1996. In the past decade, more than 2,000 new soyfoods were introduced.

26 Million Soyfoods Consumers

 Soyfoods Consumers 10% 
Other 90%

Soyfoods consumers factor in fat and cholesterol content as major concerns when making food purchasing decisions. Soy protein can be used in a variety of food products to provide the characteristics that health-conscious consumers look for — foods low in fat, cholesterol and calories (see Figure 6).

*Soyfoods market includes soy proteins, tofu, soy milk, tempeh, miso, soy sauce, soynuts and other products marketed primarily as soyfoods.

Which Soyfoods Do Current Consumers Favor?

Soyfoods customers tend to consume more than one kind of soyfood and eat soyfoods frequently. On average, more than 25 percent of soyfoods consumers eat various soyfoods once per month or more (see Figure 7).

Similarly, interest in trying other types of soyfoods is high among soyfoods consumers. For example, consumers who buy soy hot dogs tend to eat tofu more than twice as frequently as those who have not tried soy hot dogs.

What Would Prompt Consumers to Purchase More Soyfoods?

Greater product availability, for one. Food manufacturers have a great opportunity to respond to existing demand — and help drive future sales. In addition, as shown in Figure 8, about one-fourth of the total U.S. population would eat more soyfoods if they were better informed about the health benefits.

Awareness of soy protein in foods has increased dramatically during the past five years. In a 1996 soy protein awareness and usage study by Wiese Research Associates, 79 percent of the sample surveyed said they were aware of soy protein in foods, compared with 55 percent in 1991 (seeFigure 9).

To show the importance of consumer awareness to the proliferation of soyfoods, consumers were asked how likely they would be to purchase products if they were aware that the products contain soy protein. As Figure 10 shows, in 1996, 32 percent said they were “more likely” to purchase the product if aware the product contained soy protein, compared with 20 percent in 1988.

What Does the Future Hold for the Demand of Soyfoods?

The market for soyfoods is predicted to increase, reaching a $2 billion sales level by 2000. And current soyfoods consumers plan to use even more soyfoods in the future, with 25 percent reporting they plan to use soyfoods more often then they do now (see Figure 11 ).

Future Plans to Use Soyfoods
Figure 11

Foodservice Opportunities

With more than half of consumers’ food dollars spent away from home, foodservice sales continue to grow by 2 percent annually. In 1995, foodservice operators spent approximately $118.4 billion in food purchases for commercial operations (restaurants, lodging, supermarket delicatessens, etc.), and noncommercial operations (schools, hospitals, airlines, etc.), according to Technomic Inc. Many foodservice operators are looking for the health and functional benefits that soy protein can provide. A 1995 Food Industry News survey found that 80 percent of foodservice operators believe consumer concern about nutrition – especially fat content — is increasing. As a result, 76 percent of the operators plan to incorporate more “healthy” items on their menus.

Some foodservice segments face federal nutrition and other health regulations that soy protein easily can help them meet. One such segment, school foodservice, has extensively tested soy’s acceptance with students. The United Soybean Board researched soy protein’s applications in school lunches because foodservice directors must comply with regulations that require fat content to be no more than 30 percent of total dories on a weekly basis. According to the U.S. Department of Agriculture, 95,000 schools in the United States serve approximately 26 million meals per day, making school- foodservice an ideal market for research on the potential of soy protein and its role in food applications.

More than half of the school foodservice directors interviewed in a nationwide 1996 Gallup survey already use some soy protein in school lunch entrees (see Figure 12). Serving soy-enhanced foods an average of seven times per month, 80 percent of school foodservice directors use soy protein-enhanced meat/poultry; 32 percent use soy ingredients in recipes; and 29 percent use soy in meat/poultry alternatives or analogues (see Figure 13). Of those surveyed, 85 percent were satisfied with soy protein and the properties it brought to the foods they served when compared with traditional non-soy products (see Figure 14).

The top reasons for soy protein’s popularity with foodservice directors? Good taste, less fat and great functionality. Figure 15 points out that more than one-quarter of the directors cite taste as a major reason for using soy protein in their school lunches.

But what do the students themselves say about the taste of the new soy-enhanced foods? It’s not the “mystery meat” of the 1970s, for one thing.

To gauge the taste perception, six economically and geographically diverse school districts from across the country were chosen to participate in a trial involving 11,000 students and 17 soy-enhanced foods. The results were impressive:

  • 67 percent of students rated soy-enhanced entrees above average.
  • 65 percent ate all of the soy-enhanced entree.
  • 69 percent said they’d eat the soy-enhanced entree again.

With soy protein’s ever-growing popularity, it’s understandable that foodservice directors’ purchasing intentions would increase as well.

In fact, 38 percent of school foodservice directors report they plan to serve more soy in the 1996-97 school year (see Figure 16). Soy protein’s popularity has carried over in other foodservice operations such as restaurants, prisons, and colleges and universities.

By meeting the demand for soy-enhanced entrees in school foodservice, manufacturers are helping mold tomorrow’s adult soy consumer for the retail market. At the same time, as children learn more about soyfoods and experience their great taste, they will influence their parents, helping to increase demand further in both the retail and foodservice markets