As CPG companies navigate rising costs and ingredient shortages, ingredient and flavor suppliers are expanding alternatives to conventional citrus ingredients, while some citrus producers look to grow their US presence.
Since 2000, the US citrus industry has faced significant challenges between unpredictable environmental disasters, citrus greening disease and groves developed into other uses, according to a US Farm Bureau report.
Until 2014, Florida served as the US’ primary source of citrus, holding more than 70% of the country’s total. It faced an 80% decline since 2000, plummeting from 300 million boxes to roughly 62 million boxes in 2023, per the Farm Bureau.
With these drastic declines in domestic production, the US sourced from other countries like Brazil, China and the EU, according to the report.
The rising demand of citrus replacers
As CPG companies grapple with rising costs and ingredient shortages, flavor companies like Kerry, Bell Flavors & Fragrances, and T. Hasegawa are expanding their offerings of flavor extenders and replacers for conventional citrus ingredients.
The Trump Administration’s global tariffs, which include a 10% import tax and higher rates for China and the EU, add an additional layer to international trade dynamics, prompting companies to recalibrate their supply chains.
Citrus ingredient producers such as Germany-based MCI Miritz Citrus Intercontinental GmbH have been expanding US production, as seen in its acquisition of Florida Worldwide Citrus Products Group, Inc.
“We have to enlarge our footprint, our presence in the US market,” Tillman Miritz, owner of MCI, said, adding that the company’s largest market is the US and the acquisition allows the company to support a production base and US demand for natural ingredients.
Citrus isolates, like decanal and linalool, deliver natural a variety of functions in packaged food and beverage, including flavor enhancement and preservation, among others.
The acquisition will allow for Worldwide Citrus’ facility to produce a consistent supply of citrus isolates to build customized citrus profiles for companies’ products, mainly beverages, in the US and abroad, whereas before the company relied on MCI Miritz to deliver its products into the US market, Ralf Nolte, managing director, MCI, said.
As reformulations triggered from state to federal ingredient bans, like California’s additive removal and FDA’s de-authorization of red dye No. 3, impact CPG companies’ business, Art Soudjin, president of Florida Worldwide Citrus emphasizes the company’s natural flavor portfolio will provide another avenue for companies to align with guidelines.
MCI Miritz will bring its expertise and technology in processes like distillation, rectification and extractions like CO2 extraction, allowing WorldWide Citrus to “have all the technologies available right now in the citrus industry,” Tillman said.
“With the technology, we can extract what we need. We can rectify what we need. We can get out of it what we need and put into the product and come up with consistent products for them,” he added.