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Why the Humble Peanut Butter is ‘Old Reliable’


While traditional Indian fare is wholesome and tasty, nowadays, not everyone has the time or skill to put together a hearty breakfast or any other meal for that matter. An English breakfast or American ensemble is much easier for most urbanites. That could be a major reason for the newfound growth curve of the peanut butter market in the country.  Still, there are some issues such as allergies that could arise from peanut consumption, although impacting a small percentage of consumers. Let’s zero-in on the peanut butter market in India.

With rising obesity rates, consumers across the globe have started shifting towards healthier breakfast and snack options. For instance, in the UK, peanut butter is expected to overtake the sales of sweet spreads, like jam, as they are being targeted by the Public Health England (PHE) under the sugar reduction plan.

As per the IMARC Group, the global peanut butter market reached a value of $3.8 billion in 2021. Looking forward, IMARC Group expects the market to reach $5.3 billion by 2027, exhibiting at a CAGR of 5.7 per cent during 2022-2027. Currently, smooth peanut butter is the most preferred product type in the market as it is easier to spread and mixes better with smoothies and desserts.

In India, peanut butter is coming across as the most consumed food that is made by grinding dry-roasted peanuts. Other than energy, it offers fibre, protein and unsaturated fats along with a set of micronutrients including magnesium, zinc, potassium and Vitamin E. Owing to this nutritional profile, it is being used for the preparation of various food products, including salads, brownies, rolls, cakes, frostings, cornbreads and chocolates.

Key drivers such as increasing preference for nutrition products, variety of flavours, a shift towards a health-conscious world is increasing the demand of the Indian peanut butter market, however major restraint like peanut butter allergies is expected to hinder the market.

According to a consumer study across seven cities commissioned by Dr. Oetker, owned by Oetker Group in Germany, the peanut butter category is segmented into three profiles namely taste seekers, health seekers and novelty seekers. The key barriers that emerged were unknown taste, affordability, lack of usage understanding and specific product needs for the health seekers.

Generating revenue worth Rs 81 crore in the peanut/choco spreads space during FY 20-21, Dr. Oetker India has a range of peanut butter products in its portfolio.

Oliver Mirza, Managing Director & Chief Executive Officer, Dr. Oetker India says, “Peanut butter market is at a nascent stage in India, with headroom for strong growth. Growing category penetration is the core objective which can be achieved through education for Taste Seekers (new recipes such as Peanut Butter-Jelly which is a popular flavour combination or Peanut Butter with Oats & Granola to make overnight or Granola Bars etc.) and new targeted health-based offerings for Health-Seekers (High Protein, Honey, Jaggery, Natural Peanut Butter etc).”

Furthermore, a New Delhi-based startup Supplement Sack recently launched its own peanut butter in the FMCG segment under its sub-brand Muscle Fibre. The company is anticipating a threefold increase in revenue due to the rising demand for peanut butter in India.

Manish Yadav, Chief Executive Officer, Supplement Sack says, “The Indian market is already flooded with numerous peanut butter brands. During our research, we discovered that the majority of them lacked the basic requirements and quality that should be present in peanut butter. It is a staple breakfast food in the West and is consumed in large quantities, whereas it is still a growing market in India.”

Mumbai-based FMCG brand Max Protein, by Naturell India, has also launched protein peanut butter in five flavours. Recently, Jalandhar-based startup Oxie Nutrition has launched White Chocolate Peanut Butter, an unexplored and unprocessed food product that includes white chocolate compound and roasted peanuts, turned into a paste.

Harman Virk, Co-Founder and Chief Executive Officer, Oxie Nutrition, says, “The White Chocolate Peanut Butter is keto-friendly and has a greater ratio of healthy fats and protein with very little carbs. The goal is to reboot more calories from fat than from carbs.”

Adding to this list of peanut butter products in the market are Mustin, Marico, Modi Naturals, Hindustan Unilever, to name a few. But not all peanut butter is entirely healthy, as some brands add artificial sweeteners and preservatives. To enhance the product stability, aesthetic appeal and shelf life, peanut butter is added with some additives in the commercial process.

Common preservatives used in peanut butter are sodium salts of benzoates, as owing to the low moisture content in the peanut butter product the possibility of bacterial contamination in general is low. However, moulds are most probable contaminants of the product. Therefore, sodium benzoates prevent the product from mould growth and also retains freshness.

What are the risks?

On one hand multiple food brands are introducing peanut butter to the Indian audience, while on the other hand they have also started talking about the concerning issues connected with this segment.

Commenting on the same, Oliver Mirza says, “Peanuts like some other nuts are classified as an allergen. However, there is an intrinsic natural goodness with nuts (source of healthy-fats, rich source of protein, natural source of dietary fibre etc.) which makes it relevant as a superfood. The increased health-awareness during the pandemic has also increased relevance for peanut butter (due to its natural goodness) and now post lockdown measures being lifted, with gyms opening to full-capacity, the relevance of peanut butter as a workout supplement has also increased.”

Even though peanut allergy is very rare but has been linked with severe consequences all around the world. Taking the global scenario, despite the increasing number of peanut allergies in the United States, many individuals are unaware of the serious implications of peanut exposure. Peanut allergy is majorly known to cause anaphylaxis in children. An estimated one out of 50 children in the UK have a peanut allergy.

Highlighting this concern, a new study in the UK has found that infants who ate peanuts frequently from the first 11 months of their life were at a lower risk of developing peanut allergy at six years of age, even if they stopped eating peanuts a year prior. The breakthrough research has actually led to the reversal of global public health strategy for prevention of peanut allergy.

“Despite high consumption of peanuts in different foods in India, peanut allergy in children was found to be quite low (0.03 per cent), although peanut sensitisation was high at 6.3 per cent. Health Nuts study from Australia showed that the odds of peanut allergy was three-fold greater amongst children born to parents born in East Asia as opposed to children born to parents born in Australia,” explains Dr Mamidipudi Thirumala Krishna, Professor, University Hospitals Birmingham NHS Foundation Trust.

Studies have also revealed that along with thermal processing various other technologies for processing of peanuts can be used to reduce the allergic components. High hydrostatic pressure is one such technology that modifies the biological protein structures that are capable of developing an immune response upon peanut consumption. Other technologies like irradiation of peanuts before using it for preparation of peanut butter could reduce the allergic reactions.

According to Anand Patel, Senior Marketing Manager, Das Foodtech, “First and foremost, it is mandatory for us to mention the allergen info on each and every product that is manufactured. Since we understand that not everyone reads that info, we highlight the word ‘Nut Butter’ during all our promotional activities (including social media promotions, hoardings, banners, etc.) to make the consumers aware about it. We also make sure that the words on the ingredients label are highlighted and easy to grasp the attention of the consumers.”

Apart from allergic concerns, peanut producers are also facing challenges daily when it comes to wide-ranging supply and demand operation. Keeping in mind consumer demands, concerns regarding food safety and quality, as well as the right pricing model, need to be considered, in order to supply an end-product.

“Currently the major challenge that we face is that the FMCG giants have entered this market and they already have some goodwill with their existing 20-30 products and have large capital funding. As these companies already supply most of the essentials to the retail stores, it is easy for them to get new products added to the shelf. And they do this at a very low margin. To get shelf space, smaller companies have to offer higher margins and discounts to get their products placed on the shelf. This is a bit unfair as if even one company offers higher margins, rest of the companies in the segment face a lot of difficulty to place their products at the stores”, adds Anand Patel.

Creating awareness and educating the retailers and consumers seems to be key in this scenario. Although these challenges would take some time to disappear, the peanut butter segment is surely gaining a lot of popularity. It is becoming a go-to-option for gym-goers as a high protein product and the growth of this market is likely to be fuelled by the protein-seeking audience.


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