Adam note: Thanks to TraceGains for writing this post! Check out my interview with them and also their website!
Some of the stories and trends that defined 2019 in the food, beverage, and supplement space are almost certain to dominate headlines—and boardroom discussions—well into 2020. That includes such market-shaping forces as tariffs, overnight phenomena like CBD and hemp-infused products, and social justice campaigns like sustainability.
What we see emerging as the dominant trends in 2020 include: more of the same
CBD, still
With the inclusion of industrial hemp as a legal crop in 2018’s farm bill, CBD has lit the industry on fire. Experts estimate retail sales in the United States to surpass $1 billion in 2019—a jump of more than 130 percent over 2018, according to Hemp Industry Daily. That pace isn’t expected to slow anytime, soon, either. Analysts predict annual sales to flirt with $11 billion by 2024. The only news stories that might compete with CBD sales numbers are the ones about new regulations imposed by either Congress or the U.S. Food and Drug Administration.
Tariffs and trade. In March 2018, President Trump announced tariffs on China, specifically steel and aluminum. A couple of weeks later, China struck back with $50 billion worth of tariffs on more than 100 U.S. goods. Long story short, more than a year and a half later, the only things the two countries are trading consistently are insults and tariffs. Trump announced over the holidays that an agreement had been reached on “Phase One” of a deal to eventually end the trade war. China has yet to confirm that, and “Phase Two,” such as it is, lurks further along the horizon. This story will continue to steer the economy through the new year and possible the decade.
Plant-based and lab-grown food
This past year served as a coming out party for plant and lab-based proteins. Consider: Beyond Meat went public back in May, and the company’s already valued at more than $3.8 billion—and hasinked a deal with Subway. Impossible Foods, meanwhile, debuted the Impossible Whopper in Burger Kings nationwide. But those two early success stories are just the beginning. Barclays estimates the global market for alternative meat products could reach $140 billion by the end of the next decade and end up with at least 10 percent of the $1.4 trillion global meat market.
Sustainability
It’s not just social justice warriors or disgruntled college students who want more sustainable food and beverage products and packaging. In 2020, this trend will grow far beyond transparency and traceability, and will ultimately remake every link in the supply chain, from farmers to retailers. Companies like Amazon, for example, plan to be carbon neutral by 2040, including the purchase of at least 100,000 electric vehicles. While sustainability is a long-term goal powered by some short-term buzz, it will pick up speed in the new year.
Millennials
Yeah, there’s no denying they’re a driving force in today’s economy. But they aren’t they only ones influencing food and beverage trends. Consumers across the board are more concerned with what’s in the things they eat and drink. And while many consumers remain stuck in their ways when it comes to their shopping habits, younger shoppers are more inclined, and even eager, to try new products.
These are just a few of the things we expect to shape the CPG market in the coming year. To stay on top of other emerging trends, make sure you sign up for the TraceGains newsletter, and stay ahead of your competitors.