two green apples

Consumer demand for premium products is changing the face of the food processing industry, from ingredients to packaging to equipment. Twenty-first-century consumers expect not only premium quality, but a degree of personalization that speaks to their particular health needs, tastes, and lifestyle.

Andy Juarez deals with the day-to-day ramifications of the soaring popularity of premium products in his role as Director of Engineering at Tree Top, a grower-owned producer of fruit juices and sauces, which also supplies products to other producers. (The company is the world's leading dried apple supplier.) In his 11 years at the company, Juarez has seen firsthand how pervasively the push for premium has permeated the industry.

We spoke with Juarez about the challenges the juice industry faces as consumers demand more premium products, as well as the most useful solutions he's found.

Juice at a premium

According to a May 2015 article from Food Navigator-USA, premium brands made up “around 12% of the dollar share in most food and beverage categories.” While the exact percentage varies across products — for example, premium barbeque sauce captured only a 2% share, while yogurt was at 33% — there is little doubt that consumer demand for premium products is on the rise, across the board.

Indeed, Forbes reports that “global sales of healthy food products are estimated to reach $1 trillion by 2017.” Given that the definition of “premium” may extend beyond the simply “healthy” to encompass packaging, sustainable production practices, and more, it's clear that premiumization is a trend to be reckoned with.

What do consumers want in premium fruit juices, specifically?

It's pretty similar to what they want in premium products across the industry: product that is less processed, fresher, and more wholesome. They want their juices to have the color, flavor, and texture that's representative of fresh-picked fruit. And they're willing to pay more for these qualities.

In the juice market, specifically, Juarez has seen an increased desire for more blended juices, rather than old standby of apple juice or pear nectar. Consumers are also looking for juices that include superfoods, or contain fruits and veggies blended together.

Because Tree Top is also an ingredient supplier for other companies, Juarez has seen how the desire for premium products filters beyond the consumer side. For example, his company supplies fruit preps for ice cream and yogurt, purees for baby food, and dehydrated fruit for cereal and granola bars. Across the board, their clients want fruit products that appear more fresh, less processed, brighter in color, and full of natural flavor.

Companies across the fruit processing industry are in a scramble to create the highest quality product out there. “Having a defect-free premium product,” Juarez says, “is essential to be competitive” in the industry today.

Food safety and equipment

Defect-free, premium output begins with premium input on the raw product side. And companies are increasingly seeking out processing equipment that will maintain the integrity of high-quality input.

At companies like Tree Top, this means a major revision in thinking. As is the case with many other beverage producers, many of the company's factories were originally built for volume. The equipment was designed to process all fruit in the same way. But premium processing is built on lower volume and a higher degree of individuation between products.

Equipment manufacturers have stepped up to the challenge, resulting in innovations in more “gentle” processing technologies. For example, Tree Top has invested in less abrasive washing technologies. They've begun using low-shearing pumps that maintain the piece-identity of the product. Such lower-impact equipment means that the factory can maintain the integrity of even borderline-premium product.

Of course, food safety also remains of the utmost importance, particularly as companies work to meet the demand for less processed food with fewer preservatives. Nobody wants the public to be sick. And nobody wants the bad PR of a non-health-risking but still unpleasant situation like the GoGo squeeZ recall of applesauce pouches due to the presence of mold.

One food-safety technology Juarez talks about enthusiastically is high-pressure processing (HPP). HPP kills molecules that cause food to spoil — but unlike standard, heat-based pasteurization, HPP doesn't damage the product. Products that undergo HPP retain both nutrients and the natural qualities (color, texture, etc.) that consumers want. And HPP-treated products still have a refrigerated shelf life of up to 45 days.

Another up-and-coming “gentle” sterilization process is microwave technology. Microwave processing systems from companies like Aseptia and Industrial Microwave Systems heat beverages using “volumetric” rather than traditional convective heating. Like HPP, this process sterilizes without sacrificing natural color, flavor, or nutrient content. Microwave technology is also significantly more energy efficient than traditional heating methods.

As the premium market continues to grow, the industry will likely see more and more new technologies that maintain both premium quality and impeccable food safety standards.

Premium packaging

Catering to a premium market means paying attention to more than just what's inside the container. Consumers are increasingly exercising choice in the packaging of their food, as well. Sometimes premium packaging means on-the-go convenience, as with elevAte's new single-serve salads; sometime's it's the straightforward, return-to-the-basics approach of Just Mayo.

Juarez has seen the demand for innovative, personalized packaging across Tree Top's product line, from juices to applesauce to fruit purees. Companies must simultaneously anticipate and respond to consumer desires and make sure that their product stands out on the shelf.

One of the premium packaging innovations Juarez has seen the most success with is pouches.

Originally an easy-to-serve vehicle for baby food, pouches have expanded up the age scale. Companies like Plum Organics and Happy Family market their pouches to older children and adults, as well. Tree Top has begun selling its applesauce for adults in pouches with a mushroom cap. Though the convenient packaging comes at a higher cost, Juarez finds that adults are willing to spend more for products that support their on-the-go lifestyle.

Though the new frontier in packaging can be daunting, Juarez admits that it's also “a lot of fun” to go into a supermarket and see the wide range of packages on the shelf. It certainly makes for a lot more eye candy than the days of jars and boxes!

Cross-border competition

Tree Top's additional role as an ingredient supplier means that the company needs to keep global competition on its radar. With increasing competition, will it be enough to deliver products of premium quality?

The U.S. apple industry has contended with competition from China for well over a decade. Thus far, China's different quality standards and food safety regulations have kept the domestic industry relatively safeguarded. But Juarez notes that the multinationals sometimes choose imported concentrates or similar products because of the lower bottom line.

Juarez also has his eye on South America. The fruit processing industry in countries like Chile is growing and increasingly supplying international markets in the United States and Europe. Since South America has the opposite growing season to the northern hemisphere, their products can easily come in to fill a seasonal gap. As Juarez puts it, to some extent, any given market is at “Mother Nature's mercy.”

Overall market trends

Juarez is confident that the premium market is here to stay. He believes that the industry will continue to see a trend in healthy products. Specifically, he projects the arrival of many more fruit juices mixed with vegetable blends, as well as fruit products that have added protein, vitamins, and whole grains (Source: href=”http://www.wheydeal.com/”>www.wheydeal.com).

According to Juarez, sustainability will also be big. He sees multinational companies of all sizes paying increasing attention to environmental friendliness, in both packaging and manufacturing. And sustainability for Tree Top, Juarez says, is not just about being a responsible, green corporate citizen — it's also about sustaining a workforce and continuing to pay attention to the human capital side of things.

Despite the challenges posed by demand for premium products, new food safety regulations, and global competition, Juarez is decidedly happy with his chosen industry. Food processing is very competitive, but also stable.

And everybody in the industry faces the same challenges. Juarez is grateful for organizations like FPSA that allow companies to network, share resources, and respond to these challenges together.