Costs, rivalry squeeze tomato out of ketchup

NEW DELHI: "Thoda ketchup try karo/Ketchup hota kaddu bhara/Isme kaddu nahin zara." Remember these lines from the catchy Wolfarm jingle that first warned Indian consumers about the presence of pumpkin in what we thought till then was the real red stuff? The pumpkin may not be back but the tomato content in the sauce is going down.
Faced with rising input costs and increased competition from smaller players, FMCG majors such as Hindustan Unilever (HUL) and Nestle are reducing the amount of tomato paste in their ketchups.The quantity of tomato paste in Kissan Fresh Tomato Ketchup made by HUL has gone down from 28% to 22.5%, and in Maggi Rich Tomato Ketchup made by Nestle India from 28.1% to 26.7%.
Says Arvind Singhal, chairman of retail consultancy Technopak Advisors, "To stay competitive, quite a few manufacturers are tinkering with either pack sizes or product ingredients without conveying the same to the consumer in a clear manner. This could lead to a backlash and harm the brands once the consumer finds out about it."
In India’s crowded ketchup and sauce market, pegged at Rs 1,000 crore and growing at around 20% year-on-year, Nestle and HUL are wrestling for the lion’s share followed by US-based Heinz and other players like Del Monte, Sil, Cremica, Tops and Druk. Tomato paste content in foreign brands like Del Monte (29%) and Heinz (26%) as well as Indian brands like Cremica (34.5%) and Safal (35%) has not come down.
In reply to a questionnaire from TOI, an HUL spokesperson said, "Kissan has changed the formulation of Kissan tomato ketchup to enhance the experience and mouth feel. Kissan now uses 22.5% tomato paste and tomato solids in the formulation of the ketchup."
Swiss multinational food and beverages major Nestle had a similar point to make. "Maggi constantly renovates its products to further enhance the sensory profile and quality in line with consumer expectations. The recipe change of our tomato ketchup was driven by the desire to provide the consumers with an even better and superior product," a Nestle spokesperson said.
According to the Indian standard specification for tomato ketchup, it should be prepared from sound and ripe tomatoes with more than 25% by weight of soluble solids. The American standard breaks down tomato ketchup into three grades — fancy (33% total solids), extra standard (29% total solids) and standard (25% total solids). Usually, total solids are higher than the tomato paste percentage.
"If you reduce tomato paste percentage, you cut down on lycopene," says an industry expert who did not want to be named. Lycopene, found in tomatoes, is the age-defying antioxidant that guards against everything from cardiovascular disease to prostate cancer.
Tomato products are one of the chief ingredients in ready-to-eat or fast food products. As validated by American investor Warren Buffett and Brazil’s richest man Jorge Paulo Lemann's purchase of Heinz for $23 billion earlier this year, the demand for processed tomato products like tomato paste, puree, ketchup and sauces is slated to go up in India as well as globally due to the changing eating habits of younger and wealthier consumers.