Coconut sugar: Germany's next trendy sugar alternative?

German consumers are more determined than ever to make healthier diet and lifestyle choices, and with that the level of public scrutiny over ingredients in food and drink products has never been higher. Sugar, in particular, has fallen under the public spotlight, overtaking fat and salt as the primary consumer concern. High sugar consumption is increasingly blamed for rising rates of obesity and diabetes in the country, putting food and drink manufacturers under pressure to satisfy consumer demand for healthy yet tasty products.

36% of Germans cite naturalness as an important factor when buying sugar and sweeteners

With growing awareness of the negative impact that refined sugar can have on one’s health, an increasing number of consumers are embarking on a quest to find healthier sweetener options. Since health is often equated with naturalness, consumers are increasingly opting for natural sugar substitutes, such as honey, agave nectar or stevia.

In fact, naturalness stands out as one of the most important criteria affecting sugar purchase in Germany. According to a Mintel survey in 2015, over one-third of Germans named naturalness as an important factor when buying sugar and sweeteners.

The rise of coconut sugar

Of all natural sweeteners, coconut sugar shows significant potential to become this year’s trendy sugar in Germany. Coconut sugar, also called coconut palm sugar, is a natural unrefined sugar made from the sap of the coconut tree flower blossoms and is often promoted as being more nutritious and lower on the glycaemic index than regular sugar.

Coconut sugar clearly benefits from the health halo established by other coconut products, such as coconut water, coconut milk and more recently coconut oil. Although coconut sugar can’t be hailed as a nutritional superfood, the product still has an opportunity to satisfy German consumers’ interest in natural and unprocessed ingredients. Moreover, coconut sugar is often marketed as being more ecologically friendly than regular cane sugar, therefore appealing to the growing ranks of green consumers.

A promising niche market

The growing popularity of natural sugar alternatives also means that coconut sugar is more frequently used as an ingredient in food and drink products, in categories ranging from chocolate confectionery to bakery, snacks and breakfast cereals.

Use of coconut sugar to sweeten formulations is particularly pronounced in food and drinks with strong health claims, such as all-natural, organic, vegan or free-from products. Moreover, due to its natural, minimally processed and more sustainable image, coconut palm sugar is increasingly finding use in food and drink products utilising ‘raw’ positioning, and in particular sweet categories such as chocolate confectionery and snack bars.

Since more and more consumers are focusing on positive nutrition and turning to whole, ‘real’ foods and ingredients, there are significant opportunities for natural nutritive sweeteners such coconut palm sugar to capture a share of the market by appealing to diet-conscious consumers looking for healthier natural sugar substitutes.

Katya Witham is Senior Food and Drink Analyst at Mintel with a dedicated field of focus on Germany. Katya draws on her comprehensive knowledge of the market to identify and explore the major trends across various FMCG categories, providing the insights needed to successfully navigate the German market.