Sports nutrition brands charged 'crazy' whey protein prices due to low supply
For around 10 weeks now, brands have been speaking of issues with whey protein stock and rising prices with rumours spreading about the reasons behind this.
Chris McDonnell, Founder & CEO of Black Label Creations, told NutraIngredients prices were 'crazy high' after rising 80-100% and that 'no one has stock anywhere'.
To overcome this, he said he needs to book two to three months in advance to get enough stock reserved with suppliers.
Ramon Mommersteeg, Marketing Manager for Performance and Active Nutrition at FrieslandCampina Ingredients, tells NutraIngredients that most whey protein stocks are at the lowest levels in two years due to a culmination of macro trends and specific events causing low supply and high demand.
"One of the reasons sports nutrition companies, in particular, might be struggling to get a hold of whey protein is simply that demand is outstripping supply. Despite disruption to gyms and team sports throughout 2020, sports nutrition is seeing a strong comeback in 2021.
"People have increasingly turned to physical activity to improve their health and mental wellbeing as a result of the pandemic – research from FMCG Gurus suggests that six in ten active consumers are now more conscious of their overall health because of it. With this, interest in sports nutrition has been on the increase.
"Now, as gyms are reopening and sports are resuming, people are resuming their pre-pandemic workout routines and there is a whole new generation of people who have discovered the benefits of exercise and are exploring nutritional solutions to help them boost their health."
Mommersteeg notes that another knock-on effect is the fact that more brands outside of sports nutrition are looking to capitalise on increased consumer health-consciousness by developing new, more mainstream products that contain whey protein, such as pancakes, peanut butter, and even pizza.
"Alongside this, sports nutrition companies are responding to consumer demand for new product formats, like clear protein drinks, compact RTDs, and gels. There’s simply increasing competition in the protein product market," he explains.
Outside of the increased consumer demand, Mommersteeg points out that China is returning to using more whey for animal feed as it emerges from the African Swine Flu outbreak which devastated its pig population.
"Also, adding to all these factors is the continued supply challenges due to coronavirus. Therefore, it is likely that some companies will face challenges in meeting demand," he explains.
"We usually see a seasonal spike in demand in the summer months, as people take up more exercise leading up to holiday season. Right now though, we are indeed seeing high prices which could rise a little further in the coming months. This is being driven by EU feed demand, the situation in China as it begins rebuilding its pig herd, and the recovery of whey derivatives for sport nutrition and medical use as the world starts to resume pre-pandemic activities.
In terms of future supply, Mommersteeg says it’s possible that shortages will carry on until the end of the year but adds that production of whey is starting to increase.
"Whey protein plants are now operating at the pre-pandemic levels we saw in 2019 in order to respond to this higher demand. In addition, because prices have increased in Europe, manufacturers are turning away from previously competitive discount prices available to the US. This should have an influence in terms of securing European supply in the not-too-distant future.
"As a co-operative, FrieslandCampina Ingredients has access to a secure and sustainable supply of dairy ingredients, and our detailed insights into what’s driving market demand can help customers bring on-trend products to life."
