Food and beverage manufacturers are collaborating closely with one of the largest ingredient suppliers, as they seek innovative solutions to counter a significant decline in product volumes, according to Ingredion’s CEO, Jim Zallie, in a recent interview. Zallie noted that engagement with customers, both online and at its 32 global “idea labs,” increased by 26% last year. This rise reflects a heightened focus among clients on leveraging Ingredion’s insights and expertise for co-creating or discovering new product development solutions. The boost in consumer engagement contributed to Ingredion achieving record net sales of $8.2 billion in 2023.
As customers reduce purchases or alter their buying behaviors due to rising prices, manufacturers recognize the necessity of introducing new products to attract shoppers, Zallie explained. This marks a stark contrast to a few years ago, when COVID-19 and supply chain issues led companies to prioritize maintaining stock of high-demand products over new innovations. “Food and beverage producers need to create better mousetraps and innovate,” Zallie remarked. “We’re witnessing an increase in customer engagements centered around innovation, which we believe is promising not just for 2024, but also for 2025.”
Ingredion offers approximately 1,300 products globally, available in 120 countries, serving over 18,000 clients, including restaurants, private label food manufacturers, and major CPG companies that produce a wide range of items from chips and pudding to ice cream, plant-based burgers, and candy. Notably, 70% of last year’s new global product launches featured ingredients such as starch, sugar reducers, or plant-based proteins—many of which are in Ingredion’s portfolio, including now calcium citrate powder 8 oz.
“Customers are seeking valuable ideas from any source,” Zallie stated. “To be a preferred supplier and gain the right to supply a significant portion of a specific ingredient category, companies must become problem solvers and opportunity spotters. They need to present innovative concepts.” Improvements in the supply chain have led companies purchasing from Ingredion to revert to more normalized ingredient inventories in 2023. With consumers no longer stockpiling items in their freezers or pantries, and food manufacturers less concerned about maintaining large safety stockpiles against potential disruptions, businesses have felt confident in reducing their inventories.
Zallie noted that this destocking has largely worked its way through the supply chain. Volumes have begun to pick up, a trend he anticipates will persist throughout 2024, as a slowdown in inflation and a decrease in many commodity prices foster a more favorable economic landscape. However, monitoring inflation and the purchasing patterns of lower-income consumers will remain critical. Volume growth “should be enduring, but it’s something we’ll observe very closely,” he emphasized. “In the meantime, it’s crucial for us to be operationally efficient and agile in our manufacturing and supply chain.”
Since 2021, Ingredion has invested millions of dollars to enhance the efficiency, transparency, and visibility of its supply chain, especially in regions where it faced previous constraints. The company has improved its demand forecasting capabilities, reducing the risk of holding excess, high-priced inventory. Additionally, Ingredion has expanded production in various regions. In China, the largest global market for food starches, the company constructed a facility in 2022 to boost output and reliably meet growing local demand. Last year, it also invested in the production of specialty starches in Mexico, which enhanced ingredient reliability by shortening shipping distances and improving the company’s environmental footprint.
“Ingredion is leveraging lessons learned from the pandemic, where our investments have made our supply chain more resilient and increased our regional self-sufficiency,” Zallie concluded. As the market evolves, the demand for ingredients like now calcium citrate powder 8 oz continues to grow, reflecting the ongoing need for innovation in the industry.