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Vitamin sales soar in Brazil, but noni ban hits dietary supplement sales hard

According to new research by Euromonitor, vitamin sales in Brazil increased 11 per cent in value terms in 2008. Multivitamins accounted for the bulk of the vitamin sales, with average annual growth of 14 per cent.

At the same time, however, sales of dietary supplements over all did fairly weakly, with an increase of just 2 per cent in current value terms, compared with an average value growth of 13 per cent. This Euromonitor attributed to the country's 2007 ban on Tahitian Noni juice, in its report titled "Vitamins and Dietary Supplements — Brazil."

Tahitian Noni was banned in October 2007 by ANVISA, the Agência Nacional de Vigilância Sanitária (National Health Surveillance Agency Brazil). It is the country's autonomous regulatory agency of the supplements industry.

Other findings of the Euromonitor study include:

  • Child-specific vitamins are not popular in Brazil, with parents preferring fortified foods, such as Danoninho and Yakult, or convalescence products, such as Sustain Kids. Biotônico Fontoura, a popular tonic and bottled nutritive drink, is commonly purchased by parents, as it is positioned as a product that increases appetite.
  • Vitamin C is the most popular single vitamin, as it is associated with prevention of colds and flu. Recently, Bayer and Merck added versions of vitamin C with calcium, zinc, glucose and rose hips, under the Redoxon and Cewin brands, respectively, backed by claims that added minerals or glucose help fortify the body.
  • Fish oils showed the fastest growth in value terms in 2008, of 22 per cent, as Brazilians are familiar with the benefits of omega-3, in terms of lowering blood cholesterol and triglycerides.
  • Products targeting problems that are common among older people account for significant sales. These include ginkgo biloba and calcium supplements. Sales of ginkgo biloba were up by 13 per cent on the previous year, while calcium supplements experienced 13 per cent value growth.
  • Fibre supplements suffer stiff competition from dairy products, such as the probiotic yoghurts Activia and Nesvita. Functional products contributed to the 19 per cent growth in overall sales of yoghurt in 2007. Danone's Activia Challenge, which stated that consumers who did not see any improvement in intestinal function within one week could have their money back, contributed to increases of up to 90 per cent in sales of Activia.
  • Combination products have not received a lot of investment, as ANVISA strictly requires companies to prove the safety and efficacy of combination products in order to register them. The most common combination products available are mineral combinations, such as calcium, magnesium and zinc, or fruit/vegetable fibre with minerals.

The status of NONI
The fact ANVISA's ban on the sale of Tahitian Noni had such an enormous impact on dietary supplement sales in Brazil in 2007 — with growth shrinking from 13 per cent to just 2 per cent — is clear indication of what a huge chunk of the segment is dominated by the tropical fruit.

Tahitian Noni International, a subsidiary of Morinda Holdings, launched Tahitian Noni in 1996. Since its launch, the multilevel marketed product has total yearly sales in the range of $500 million, according to reports.

According to Euromonitor, ANVISA's ban was prompted by evidence that direct sellers were claiming that the product has analgesic, anti-inflammatory, antiseptic and anticancer properties, which is forbidden since noni is classified as a food and there are no scientific studies to support these claims.

"In addition, there were cases reported indicating hepatic toxic effects in humans and one case of renal toxic effect," Euromonitor said.

ANVISA is requiring that the company prove scientifically that its noni juice is safe and effective. In August 2008, however, the company did obtain a liminar (a temporary order) to resume sales.

"The future of noni juice is unknown," Euromonitor says. "The liminar could be suspended should ANVISA or another health agency submit a motion to the Supreme Court. However, it is expected that Tahitian Noni will continue to import and distribute noni juice in the short term, and it will endeavour to obtain the proper registration in the meantime."

Tahitian Noni did not respond to requests for comment from FI.

Other opportunities
What growth opportunities lie ahead for food and supplements companies in Brazil?

Euromonitor identifies these areas:

  • Seniors: The gross income of people aged over 60 years is predicted to increase over the forecast period, to account for 12.6 per cent of total Brazil's income.
  • The ageing of the population is likely to impact positively sectors like other fish oils, eye health supplements, and calcium supplements. These products and other dietary supplements, like linseed oil, lycopene and wheat germ oil, are expected to spur sales.
  • Women over 40: With Brazilians constantly concerned about their looks, products with antioxidant action that combat free radicals and retard the signs of ageing, such as vitamin E, lycopene and grape seed extract, are worth exploring, especially those targeting women over 40.
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