Garrett McBride [00:00:09]:
Hey there. Welcome to get
Garrett McBride [00:00:10]:
the scoop with Smirk’s podcast where bulk ingredient conversation happens. We’re sharing our knowledge and expertise as bulk ingredient importers, tapping into the latest trends we are seeing and commenting on what that means for natural food businesses as they approach ingredient purchasing, product development, and marketing. You’ll hear the latest market reports, ingredient specifications, and product applications from Smirk’s in house experts, as well as origin stories from our growers and processors around the world. Listen in for the scoop on what’s happening with bulk ingredients.
Jessica Warden [00:00:49]:
Welcome back to get the scoop with Smirk’s podcast. My name is Jessica Wharton, and here with me is my colleague Zach Schwint. Smirk’s is not only organic and conventional suppliers of bulk bakery ingredients, but we’re big fans of baked goods as well. The bakery industry is massive. The global bakery products market size was valued at 457,400,000,000 in 2023 and is projected to grow to almost $731,700,000,000 by 2032 according to Fortune Business Insights. And if we look at the bakery industry in the US, according to the American Bakers Association, it was valued at 533,200,000,000 in total economic output. That’s roughly 2.01% of the GDP in 2023. Also, in 2023, bakers, product distributors, importers, and retailers directly or indirectly supported almost 2,200,000 American jobs.
Zach Schwindt [00:01:48]:
Wow, Jessica. That’s a whole lot of cannolis. Cereal. Is not only a huge category, but it’s incredibly diverse as well. And ever since you and I worked at the Smirk’s booth at the IDBBA show in Houston back in June, that we’ve been more fired up about bakery products and digging into the trends than ever before. That’s what kick started our official Smirk’s top 10 countdown of the best bakery trends in 2,024.
Jessica Warden [00:02:14]:
You couldn’t hold me back even if you tried, Zach. We’ve been exhibiting a lot this year between Expo West and IFT and Fancy Food and ITDBA. We’ve seen a ton of interesting product ideas and ingredients being used in all corners of the bakery category. So it’s only fitting that you and I start our Smirk’s top 10 best bakery trend countdown for 2024. Kick us off, Zach.
Zach Schwindt [00:02:41]:
You got it, Jessica. Number 10 is one that I personally love, and that is vanilla being used as a staple ingredient in baked goods. Vanilla is not only a popular flavor, but it’s a flavor that evokes nostalgia. Nostalgia is comforting and brings us back home or back to our childhood memories then a lot of people gravitate towards vanilla for that reason. It’s very comfortable and familiar. There’s also a level of elegance to vanilla, specifically with natural vanilla, but it’s still approachable and can be used by anyone. Vanilla is a key ingredient in many desserts such as cakes, you know, cake frostings, cream boule, ice creams, you name it. You know at Smirk’s, we have 3 different categories of vanilla and the first would be vanilla liquids.
Zach Schwindt [00:03:27]:
So in the liquid category, we have vanilla extracts. We have single fold, double fold, which is twice as concentrated as single, all the way up to 10 fold. We also have a non alcoholic vanilla flavorings for those who don’t want, you know, alcohol in in their formulas. 2nd on the list would be vanilla powder. So this would be ground vanilla bean. That’s it’s basically turned into powder format. So it’s great for ice creams. You could put the little specs in there and Sure.
Zach Schwindt [00:03:55]:
Granolas as well. It’s a pure vanilla format. So a lot of, you know, natural companies like the ground vanilla bean as an option. And then you have as a third category, you have whole vanilla beans. And then these are used, you know, for obviously manufacturing vanilla extract or paste or powder, but they’re also used by professional chefs and bakers who open up the vanilla pod and scrape out what’s called vanilla caviar out of the inside. Yeah. So by the way, you could check out episode number 9 of the Get the Scoops with Smirk’s podcast to dig deeper into our vanilla origins, applications, and different vanilla trends. Jessica, number 9.
Jessica Warden [00:04:34]:
Thanks for sharing that information on vanilla, Zach. I would definitely agree with you on the nostalgic piece. I know when I was a kid, my favorite part of making cookies with my mom was right when the butter, the sugar, and the vanilla went in the bowl, and that was when I would try to stick my finger in it and then get yelled at. So that’s my, childhood memory, but it is definitely one of my favorite things to use in baking. I’m very intrigued by this vanilla caviar. Never seen that before.
Zach Schwindt [00:05:05]:
Yes. You’ll have to do some experimenting.
Jessica Warden [00:05:08]:
Yes. Or I’ll have to, you know, bribe you into bringing me some vanilla caviar one day.
Zach Schwindt [00:05:13]:
Easy. Done.
Jessica Warden [00:05:16]:
Alright. Well, the number next on our countdown list is one that’s really intriguing to me personally, not because I know a lot about it or an expert by any means, but simply just because I think it’s fascinating. It’s 3 d printing and how it’s being integrated into baking now. As many of our listeners might know, 3 d printing technology is making waves across a lot of different industries, and bakeries are no exception. I think one thing that is attracting 3 d printing to this category specifically is it allows bakers and whether you’re a home baker or a commercial baker, industrial baker, to create intricate and customized designs that were previously really impossible or extremely time consuming. So now you can do things like print cake molds to cookie cutters, to making intricate chocolate sculptures. 3 d printing offers endless possibilities for creativity and efficiency in the kitchen, which leads me to my, next question, Zach, is, have you ever tried your hand at next level baking? And I’m not talking about, you know, mix out of the box, but more like you’re hoping to get the next spot on a great break show, the US edition of that.
Zach Schwindt [00:06:34]:
You know, Jessica, I, I am not a baker. I am a hard cook. I’m unorganized. It’s it’s hard for me to follow a recipe, but I do have a memory of myself. I made a cake for my sister for her birthday with my vanilla, and it was basic. It was white. I didn’t put any designs on it. I just put candles.
Zach Schwindt [00:06:54]:
And so, honestly, no one could have messed it up. So to answer your question, no. I’ve never done anything too complicated, but I’m curious to know how 3 d printing can help me do that.
Jessica Warden [00:07:05]:
Yeah. That’s what’s, I think, really exciting about this is anybody I feel like at various skill levels, obviously, you need access to it, but some of the practical applications of this is where you can create custom cookie cutters or custom fondant molds that can take your amateur baking to the next level. But it also is jumping to the next level, on the industrial scale in that there are companies that are actually using it to print actual food items. Have you seen this at all?
Zach Schwindt [00:07:35]:
I actually haven’t. Sounds fascinating.
Garrett McBride [00:07:38]:
Yeah. I’d love
Zach Schwindt [00:07:39]:
to be able to print myself some new
Jessica Warden [00:07:40]:
companies oh, yeah. Exactly. Right? Like, where you’re just like, that cheeseburger looks good. You know? Control print.
Garrett McBride [00:07:47]:
Exactly. Yeah.
Jessica Warden [00:07:49]:
So there’s companies like Foodini and Chefjet that are pioneering in this space. Foodini has been cited, for instance, to print a variety of foods using fresh ingredients. So I’d imagine their printer cartridges don’t come in the mail from HP. They must be crafted in some kitchen somewhere. But it’s making it possible to create complex designs with ease. And then there’s some bakeries that are specializing in printing sweets and chocolates, really allowing the intricate sugar sculptures and detailed chocolate decorations. But as we kinda highlight some of that, you might be hearing the same thing I’m hearing, but in the back of the head our my head is our QA team just being like, but what about food safety? And so that piece will be, I think, the piece that needs to continue to evolve. How would these 3 d printers on an industrial commercial making scale? How will we make sure that they’re going to continue to be safe? I’m sure it’ll be much like all of the industrial food equipment processing that we’re already seeing, but it’ll certainly have to be kind of integrated into that.
Jessica Warden [00:08:50]:
So do you have any brands that you’re working with now, or have you seen it on a, you know, consumer level where people are doing this that you’re watching?
Zach Schwindt [00:08:58]:
Yeah. I’ve seen some 3 d printing, you know, and with I did IDBA show that we had went to, but I don’t have any brands per se I’m not sure. That are actively, you know, involved in doing this. But I think there’s a lot of room for growth. I think a lot of companies are gonna wanna use this to just create more efficiency. So
Jessica Warden [00:09:16]:
Right. Right. And I think that’s what’s really exciting is that 3 d printing is really gonna touch on the sustainability piece where minimizing access ingredients and making sure every little bit is utilized and utilized effectively. It’s a lot like what GPS has done for farming practices. It’s you know, this will kind of do for some of the food industry, you know, the the precision of some of the different things. So that’s me for my very novice level of of baking. You know, I think I’m right there with you with the bland vanilla cake, but I’m excited to see what what will come out of it. So Awesome.
Jessica Warden [00:09:49]:
That’ll wrap up item number 9. So, Zach, why don’t you take us into what we’re seeing on number 8?
Zach Schwindt [00:09:58]:
Gladly. So number 8, we have sugar reduction and alternative sweeteners. Low sugar claims have been more prominent I think now than ever. But even if a company is a promoting say a keto, you know, if they’re not promoting keto, it’s at least low sugar that’s that people are wanting more, you know.
Jessica Warden [00:10:16]:
Right.
Zach Schwindt [00:10:16]:
People want less carbs and overall less sugar. So some sugar alternatives that are incrementally more healthy include, you know, coconut sugar, date sugar, maple syrup, and different products like coconut nectar and monk fruit.
Jessica Warden [00:10:34]:
Right.
Zach Schwindt [00:10:34]:
So coconut sugar, it’s a great product. We import a lot of coconut sugar here at Smirk’s. There’s multiple mesh sizes so there’s really fine grade coconut sugar that some bakeries really like. There’s also the standard granulation, more of a 16 or 18 mesh size. But coconut sugar is, you know, widely used throughout the bakery industry in the US and we see a lot of continued growth in that ingredient. Date sugar is 1. That’s a single source of sweetness. A lot of companies are starting to use dates for not only just for the fiber and whatnot, but the sweetness.
Zach Schwindt [00:11:13]:
You know, they wanna sweeten their products whether it’s a beverage or an ice cream. We’ve seen it a lot in in the dairies industry as well where they’re using dates to sweeten their products. And that that’s a trend that I definitely can see continuing.
Jessica Warden [00:11:28]:
Right. And you see the cleaner label with that kind of like you mentioned with the single ingredient source where it just really cleans up labeling. I know, you know, to your point, as my kids are starting to grow and we’re learning about nutrition and all the different things that I show them, we’ll we’ll look at nutritional labels, and I’ll point out to them how much added sugar something has, and we’ll pick different alternatives based on some of that. So
Zach Schwindt [00:11:50]:
Right.
Jessica Warden [00:11:51]:
And that’s, like, again, just me at kind of a a very novice level of that. So I know from r and d and development, we’re seeing a lot of brands that really drive that way where they want cleaner labels, better
Zach Schwindt [00:12:03]:
Exactly.
Jessica Warden [00:12:04]:
Macros and and micronutrients on their labels and
Zach Schwindt [00:12:07]:
Yeah. Sugar. Seed. Yeah. Date sugar and coconut sugar definitely check a lot of boxes for people. Yeah. For example, coconut nectar. You know, it’s a liquid sweetener.
Zach Schwindt [00:12:16]:
Great for
Jessica Warden [00:12:17]:
Yeah.
Zach Schwindt [00:12:17]:
Different frostings, you know, adds moisture to products as well. We’ve seen some chocolate companies use it. Some companies who are who are developing beverages, coconut nectar has been a great option for them. So I definitely see some continued use in coconut nectar in the US for sure. And that brings me to maple sugar and syrup.
Jessica Warden [00:12:39]:
Right.
Zach Schwindt [00:12:40]:
Most of that is coming from, you know, the northeast. It’s a little bit more pricey than what you’d see in the coconut or date category, but certainly has its own flavor profile and is kind of in the with vanilla where it’s a nostalgic flavor and certain people just really want that maple flavoring. So, and then of course we see products like monk fruit, which have come into the US and I’ve taken a lot of products and totally know a lot of brands have geared their entire brand around these types of sweeteners. So definitely an interesting one to to watch for sure.
Jessica Warden [00:13:16]:
Yeah. Agreed. I don’t think this is going away anytime soon, which is why it’s number 8 on our countdown. So moving on from natural sweeteners, we’ll move on to number 7 on our countdown where we cannot overlook the power of social media and how it’s impacted bakery industry. I think, overall, social media has been a driving force behind the popularity of a lot of baking trends that we wouldn’t even have enough time to go over in in a probably a week long podcast if we tried. So but even like myself, I’m pretty social media versed, but I fully understand how the visual nature of the platforms, like Instagram and TikTok and Pinterest, combined with, like, how quickly you can share recipes and how quickly you can share experiences, have made it much easier for these trends to gain widespread attention and enthusiasm. So in our industry, we’re seeing that a lot of Gen z consumers are adopting some of these, you know, mash up combinations and flavors and unique flavors where they first see them on and or experiencing them on TikTok or Instagram or YouTube. And so one example that I am not sure you’re familiar with, but I wanted to ask you, Zach, is the cronut.
Jessica Warden [00:14:30]:
Tell me what you know about the crone
Zach Schwindt [00:14:33]:
Ah, cronut. I don’t know if I’m familiar with such cronut you speak of here, Jessica. What is it?
Jessica Warden [00:14:40]:
Well, seems like you live under social media rock like myself. So I will tell you the you know, what I figured out was, so the cronut is a mash up of a croissant and a doughnut. And so it’s been around the New York bakery scene since 2013. But what is really kind of pushed it along where I guess made it, you know, cemented it as a cultural phenomenon really has been social media. So there’s been numerous outlets that spark discussions around these trends and really created this novelty in the culinary world to the point where a lot of people have made it a bucket list item. So you don’t know about it. You didn’t know about it before now, Zach, but now you’ve got to add it to your bucket list. Next time you have the possibility, you gotta hit it up and try out the Kronos.
Zach Schwindt [00:15:28]:
It is high on the list.
Jessica Warden [00:15:30]:
Yes. Yes. Exactly. And then the editing I’ve noticed about social media and how it can really drive trends in bakery and really in the culinary world in general is this idea of experiential sharing. So it’s kinda like that bucket list thing. You go, you eat it, you try it, you take a picture of it, and you share it with your friends. And right away, you wanna know you want everybody to know you tried it, and you also want them to comment and like. And so, yeah, that brings me to my next exact polling question is, what is the best thing you’ve ever tried and couldn’t wait to share on social media?
Zach Schwindt [00:16:04]:
No. It’s not in the bakery category, Jessica, but, at the farmers market on South Pearl Street, which I go to in Denver, they have a rattlesnake hot dog. Oh, that’s all over. You know, we saw it first on a Denver Denver platform, Denver for farmers market on Instagram. And and, I, you know, actually didn’t plan on buying it. But once I saw it, I got conned into buying it and actually wasn’t too bad. So Nice.
Jessica Warden [00:16:31]:
Nice. How many likes did your post get?
Zach Schwindt [00:16:34]:
I didn’t quite catch. I’ll have to go back and tally those up one by 1.
Jessica Warden [00:16:38]:
Isn’t that isn’t that the point of it is if it’s All about likes.
Zach Schwindt [00:16:42]:
Right? Yep.
Jessica Warden [00:16:43]:
Yeah. Right? Yeah. Yeah. Exactly. Well, besides, you know, the corona, there’s lots of different mashup flavors. And the other thing that I’m interested to kinda watch is how social media continues to drive the different bakery subscriptions. I, myself, was a beneficiary of a, dope subscription for my birthday, which is cookie dough that my sister sent me. And so it was just one of those fun things where it was a special day for me and we’re otherwise apart, and so we were able to share in that.
Jessica Warden [00:17:11]:
And and so I see that where social media will probably continue to drive certain things like that. So I’m at mentoring to see how that continues to push along our, you know, trend number 7. But wrapping that one up there, Zach, why don’t you take us right into countdown item number 6?
Zach Schwindt [00:17:30]:
Gladly. Here we have number 6, gluten free bakery items. So in 2,023, gluten free bakery market was valued at nearly $6,600,000,000 according to Global Market Insights. And this trend centers around awareness about gluten related health conditions such as celiac disease and gluten sensitivity. There’s also a group of people such as myself who choose to eat more gluten free products for general health reasons or just because they live with a person that has a gluten allergy. So for example, I went to a pizza restaurant before where for an extra $2 you can upgrade to chickpea crust or chickpea flour, you know, basically a gluten free option. And I’ve always been intrigued. Is it chickpeas? Sorry?
Jessica Warden [00:18:14]:
What what does it taste like? Can you tell the difference? Like, what does it what’s the To
Zach Schwindt [00:18:17]:
be honest, I can’t really taste the difference. I’m not the most zoned in on on my flavor and and whatnot, but I really can’t I really can’t taste the difference. So gluten free flours are usually a combination of starches and powders that are used to produce breads, cookies, cakes, muffins, and savory crackers. First off, we have almond flour. You know, it’s a common product produced, you know, from almonds, you know, it’s blanched almond flour, natural almond flour. So a lot of cracker companies have used almond flour for high protein content. It’s a very clean product. A lot of people really enjoy having that extra protein boost in their baked goods.
Zach Schwindt [00:19:02]:
Right. Coconut flour is another one. You know, at Smirk’s, we work with quite a lot of coconut flour. It’s definitely got a more coconut taste to it, but you if you’re putting it with other ingredients, there’s really not it’s not overpowering by any means. It’s quite affordable in comparison to some of the other nut flours as well. Jessica, have you ever had an experience with customers using coconut flour for any baked goods or breads or anything like that?
Jessica Warden [00:19:27]:
Yeah. Actually, when I first was starting at Smarts, I worked with an account that used it very heavily in a keto mix. And so that was kind of one of my first items that I really enjoyed working with at Smarts because I I actually got some traction with it, and I started to learn about it. So that one that one is really a staple for me in my own portfolio, but also just like you mentioned across the board, we work with a lot of brands that utilize coconut flour.
Zach Schwindt [00:19:50]:
Right. And a lot of people also like the higher fat content of coconut flour as well. Yes. We also have pulse flours. For example, chickpea. It’s gained a lot of momentum in the US. We’ve seen companies producing cereals with it, extruding with it. We have companies who are, like I mentioned, using it with pizza crust.
Zach Schwindt [00:20:11]:
I think chickpea flour is one that we see gaining a ton of momentum over the next few years.
Jessica Warden [00:20:17]:
Agreed.
Zach Schwindt [00:20:18]:
And then oat, you know, oat oat flour is one that really isn’t gluten free by nature, but there is a gluten free option. Sure. There’s both gluten free and non gluten free on the oat category. Typically, it’s a lot lower on the cost side than some of your nut flours and whatnot.
Jessica Warden [00:20:36]:
Right.
Zach Schwindt [00:20:37]:
And then it does have a pretty nice flavor as well, a nice nutty flavor that goes well with a lot of baked goods. And then next on the list, we have tigernut flour. That’s kind of a new one that, you know, in the US, we’re seeing a lot of companies using tigernut flour for benefits for low glycemic. Some companies use it for horchata as well. It’s actually the original base for horchata. So Yeah. Cassava starch is another interesting one. It’s kinda goes with potato starch and arrow root powder as well.
Zach Schwindt [00:21:12]:
Ube powder is a newer one that we’re seeing. It’s basically a purple sweet potato. Some companies are using it for you know, that adds a purple color to some of the recipes.
Jessica Warden [00:21:22]:
And Right.
Zach Schwindt [00:21:23]:
In the bakery category, I think that’s kind of a trendy thing. Having a unique color is cool. So
Jessica Warden [00:21:30]:
Yeah. We’re starting to see a lot of the exotic flavors, exotic trends. So that’s where you mentioned, like, tigernut flower and ube powder. Some of those are really picking up steam. And and then like you said, chickpea is one I’m seeing a lot of, which I think we’ll kinda touch on a little bit later in one of our other items. But because of its potential on protein content as well, it kind of ranks a little higher than some of those kinda like you mentioned with some of our competitors. So Yep. Yeah.
Zach Schwindt [00:21:55]:
Well, number 5.
Jessica Warden [00:21:57]:
Yeah. Number 5. Wrapping on number 6. I am right and we’re halfway there. And so next, we are gonna be diving into a topic that is really been rising faster than our favorite sourdough, functional foods, and how they’re appearing more and more in the bakery world. Zach, what do you think of when you hear functional foods?
Zach Schwindt [00:22:19]:
What comes to my mind is you eat a functional food for a benefit other than just the basic nutrition. For example, if you eat collagen, you’re probably wanting stronger nails and, thicker hair. And a lot of people also use, you know, gut health is a huge trend right now. And when I think functional foods, I think that’s one that that comes top of mind.
Jessica Warden [00:22:44]:
Well, if we were riding around in the old cash cab, you would definitely have won money in that one, Zach. You got it right you know, hit it right on the nose. Essentially, gut health is really one of the things that comes top of mind when consumers think of functional foods. There’s this growing emphasis on health and wellness, and bakers are incorporating gut friendly ingredients into their, you know, creations. So we’ve seen it for several years in the natural food industry, but, you know, even as recently as Expo West from this year, our team you know, I think we noted in our Expo West wrap up that we’re really starting to see more and more of that. A lot of recipes are, you know, notably shifting and incorporating those ingredients that specifically support gut health. So things like ancient grains, quinoa, spelt, teff are being used more frequently because they’re both high in fiber and prebiotics. And so that obviously nourishes that beneficial gut bacteria.
Jessica Warden [00:23:41]:
The other thing that we’re seeing is fermented products, such as sourdough, you know, have been gaining in popularity, and a lot of this is due to the improved digestibility and nutritional benefits. But fermentation also can enhance flavor and texture of the, you know, item that it’s in. So I’m not sure if you knew this, fun fact, Zach, but the natural fermentation process helps break down gluten and other hard to digest components. So that makes it great for breads or excuse me. That’s why fermented options are great for for those with sensitive guts. And it kinda ties back to what you were saying with the gluten free types of transversing. So this is a way to kind of have your bread and eat it too. Have your gluten and eat it too is is adding some of these other things in there.
Zach Schwindt [00:24:26]:
No. That’s great info. So that’s something I didn’t know. Yeah.
Jessica Warden [00:24:31]:
Beyond, you know, prebiotics, we’re also seeing a rise of use in probiotics in baking, which basically live bacteria that provide numerous health benefits, again, for that digestive system. And so one of those things, it’s kind of interesting where we’re seeing typically, when you’re baking high temperature, things are what can kill the beneficial bacteria. So we’re actually seeing innovations and techniques such as low temperature baking and adding probiotics after the baking process are really being its work so that we can continue to see this trend grow and basically let these bacteria survive and thrive. And so the interesting question that, you know, we can really ponder is why? You know, Zach, why do you think this trend continues to permeate natural foods world?
Zach Schwindt [00:25:17]:
Yeah. I think people more now than ever, they wanna feel at their best. You know, people want to they wanna have a clear mind. They don’t wanna have they don’t wanna feel bloated as they’re walking around all day. People wanna be performing at their highest level. It’s like the old saying, you know, food is medicine. I think people are starting to realize that the more emphasis you have in the food you eat, the better the ingredients that are going into your food, better you’re gonna feel and overall, the better you’re gonna perform. So that’s kinda my thoughts surrounding the whole thing.
Zach Schwindt [00:25:45]:
But
Jessica Warden [00:25:45]:
Sure. Well, there’s another $100 from the cash cab, so
Zach Schwindt [00:25:49]:
it’s a good job. Lucky day.
Jessica Warden [00:25:50]:
Yeah. Exactly. No. I think you’re right. Basically, that’s what’s being written on and the trends and the summations of all of the research that’s going into this is exactly what you just said. Consumer awareness and people kind of doing everything that you just said is the driving force behind those trends. So I don’t think it’s going away anytime soon. And so for our listeners, some practical applications that, you know, we can see as a direct relation of how smarts can help is we work with Ancient Greens, and we often have quinoa and teff in the warehouse ready to go so we can help with samples, r and d, bench top development, that kind of thing.
Jessica Warden [00:26:28]:
There’s probiotic powders out there that can be mixed into doughs or used in toppings. And like Zach already mentioned, in natural sweetener topic is opting for those natural sweeteners like coconut, sugar, or date powder, or even maple sugar can help with the gut compared to what the refined sugars could do to the digestive system. So as we start to see the intersection of gut health and baking, there’s some really cool opportunities out there for both bakers and consumers. So we’re really excited that it’s part of the trends, but that’ll wrap up our, you know, halfway point on the countdown, and Zach will take us right into number 4.
Zach Schwindt [00:27:08]:
Thank you, Jessica. Number 4, we have seeds and seed flowers. Originally, we just had seeds and and we decided to add seed flowers as well because, really, I think, we’re seeing, you know, in the bakery category, seeds are used not only a top of baked goods, but also as a core ingredient inside of the baked good.
Jessica Warden [00:27:27]:
Right.
Zach Schwindt [00:27:28]:
Not only are they a gluten free replacement for traditional flours, but they’re known to be, you know, a source of fiber, protein, and they’re also high in minerals. Not to mention that seeds are are typically allergen free as well, you know, excluding maybe sesame. Sure. You know, so big seed items would for smirks would be, you know, flax seeds, chia seeds, pumpkin seeds, hemp seeds, and poppy seeds. And these would go into crackers, muffins, cereal bars, granola bars, you name it. And the flax category, you know, there’s brown and golden flax. They come, you know, and and milled in whole formats. So, it’s one that you can purchase in a powder format or you can purchase as a whole seed and sprinkle on the top of your bread.
Zach Schwindt [00:28:16]:
And same with chia really. Chia comes as a powder. It can also be added in into granolas or cereal bars. I think it’s really common in different, smoothie bowls and that type of thing.
Jessica Warden [00:28:29]:
Right.
Zach Schwindt [00:28:30]:
Pumpkin seeds is one where, you know, you have different types of pumpkin seeds depending on where they come from, different grades. You have like the dark green Styrian pumpkin seeds that come from Europe. And then you have the more shine skin, the smaller green seeds coming from China and Mexico, but those are definitely a staple in the bakery category. And hemp seeds, you know, hemp seeds is one that, you know, it’s coming from all different corners of the world. It’s really high of protein as well. It’s got really healthy fats, and it’s definitely a popular ingredient in different breads and whatnot. And then poppy. Poppy is, obviously, when I think of poppy, I think of, like, lemon, you know, lemons the poppy seed muffins and whatnot.
Zach Schwindt [00:29:15]:
Yeah. Yeah. So those are typically not in milk format, but we do see those pop up a lot, you know, in the seed category. So
Jessica Warden [00:29:24]:
Yeah. I would say one thing to even know, with seeds that’s interesting as it can relate to the baking category is a lot of seeds are pressed for oil. And so the resulting cake or resulting byproduct actually has a very high protein content and has a very fine mesh. So it can work really great in baking applications and is sometimes overlooked because for the longest time, it was simply a byproduct of the oil pressing process. So in addition to maybe the whole seed being milled into a flour, some of our customers have found the benefits of this higher protein, lower fat flour that comes from some of these seeds. Yeah. Something to think about when you’re formulating for sure.
Zach Schwindt [00:30:07]:
Yeah. Great point.
Jessica Warden [00:30:09]:
Well, I guess that’ll take us right into countdown item number 3, which actually I segued very perfectly is high protein baking items, you know, from our fat pressed out of our seeds, high protein content flours. We start to see consumers are really looking to boost their protein intake. So we’ve started to see a lot of interest in our customers, our manufacturers looking for something that prioritizes that protein content. So whether it’s for dietary preferences, whether it’s, you know, to be that more functional ingredient, we’re starting to see high protein options becoming staples. And kinda when you think high protein, maybe 5 to 10 years ago, there was a handful of protein sources that were used to really inflate protein content that sometimes maybe left a bitter taste or had a weird texture. And so I think in recent years and in the trends that we’ve seen at some of the natural food shows we attend is that you’re starting to see some innovation around how to mask some of that flavor that, you know, maybe isn’t as desirable. We’re starting to see new protein like chickpea coming online. And so just overall, we’re starting to see how this can basically, the net carbs where it’s the higher fiber, higher protein, and then lower net carbs is really what what’s driving this trend.
Jessica Warden [00:31:31]:
So I think, Zach, just kind of on that line, I’m sure you can recount a time when you ate some high protein item and, it maybe left you some little bit of weird mouth feeling or weird taste. What’s the time when you experienced that? And everybody’s probably noticed that.
Zach Schwindt [00:31:47]:
Yeah. I mean, other than the rattlesnake hotdog I had mentioned earlier, probably a pea protein milkshake that I had tried at, I think, at my first Expo East in Philadelphia. There was a brand that was exhibiting a pea protein. And for whatever reason, I don’t think they put any sort of sweetener or something in it. It was very tough to swallow and look at the guy with a straight face and tell him it was delicious. So Right. Right.
Jessica Warden [00:32:12]:
Whatever you do, don’t name names. That’s yeah. But well and that’s that’s the I mean, even that’s such a good point. So that was probably expo 3 to 4 years ago, and now there’s so many products out there where you can go up and you can taste these products, and it is such a different you know, where they were at 3 to 5 years ago to where we’re at now. So a lot of that we’re seeing, you know, driven, obviously, plant protein is a piece that’s not going away. We’ve continued to see it in baked goods. We’ve so like you mentioned, even when folks aren’t necessarily only, you know, needing plant protein or excluding milk protein from their diet, they’re still wanting those options. And so that’s one of those things where it’s appealing to vegan and vegetarian consumers, but also just any consumers.
Jessica Warden [00:33:00]:
So Mhmm. It’s been really interesting to kinda see how that goes. I think one thing we can highlight is the versatility of high protein baked goods. Basically, if you’re, you know, having that protein packed bread or a muffin or cookie, it helps you maybe feel better about what you’re eating when you’re eating a muffin, but it’s a protein muffin. Maybe that as a consumer, you’re like, yes. I Yeah. We got my protein intake for the day. So I don’t know what that means for the future of baking, but I think the high protein trend is more than a passing fad where consumers kinda continue to prioritize health and nutrition both.
Jessica Warden [00:33:35]:
What do you think, Zach? Do you think we’ll continue to see more of this?
Zach Schwindt [00:33:39]:
Yeah. I don’t think protein is going anywhere. Yeah. I think it’s here to stay. People feel better when they eat a higher protein level, cleaner proteins. I think the protein space in general is just continuously evolving. And one other space that I think is continuously evolving and brings me to number 2 is plant based and vegan alternatives.
Jessica Warden [00:33:59]:
Yes, definitely.
Zach Schwindt [00:34:01]:
1st, we have the alternative milks. So we have coconut milk, coconut cream, which are kind of used interchangeably and coconut milk usually refers to a lower fat content. Coconut cream usually refers to a higher fat content. But coconut is a fantastic substitute to traditional dairy to, you know, achieve a more creamy consistency or mouthfeel in a beverage or even a cream inside of a a doughnut or yeah, exactly. A dessert. Coconut milk powder is another one that a lot of people prefer to customize the level of creaminess and whatnot. So this allows them to kind of
Garrett McBride [00:34:39]:
Right.
Jessica Warden [00:34:40]:
You know,
Zach Schwindt [00:34:40]:
you mix it with water and you’re able to throw another liquid and you’re able to totally customize your your mouth feel and whatnot.
Jessica Warden [00:34:48]:
Right.
Zach Schwindt [00:34:49]:
Oat milk is one that I think is popping off, and I see a lot of movement on. And it’s really interesting because oats you know, the oat flour, you know, you can’t really make milk from the flour, it has to be further processed. And some of our our customers are actually they buy the flour and will produce these plant based alternatives from the input material that Smurx provides.
Jessica Warden [00:35:14]:
That’s awesome.
Zach Schwindt [00:35:15]:
So it’s kind of interesting to see everything kind of work full circle. But many of the other alternative milks that we see are almond milk, hemp milk, macadamia milk, barley milk, and soy milk. Any other types of milks or alternatives that come to your mind, Jessica?
Jessica Warden [00:35:31]:
You know, I don’t think so. One of my favorite things actually is the the coconut milk powder. We use it. It’s a staple in our pantry here and mainly because it we use it, you know, as a way to sweeten things rather than using even, like, a it’s almost like I could use it as a powdered sugar alternative Right. On some types of applications. So my kids love the taste of it for that part of it, and then I love the taste of it in certain baking applications. So that one’s one we key in on. And outside of that, I think coconut is just in general one of my favorite flavor profiles, so I kind of lean towards that.
Jessica Warden [00:36:07]:
And outside of, you know, the oat and almond. I guess sunflower sunflower is one that is maybe not on those list. I’ve started to see that.
Zach Schwindt [00:36:15]:
Yeah. We have started to see some sunflower milk. I did see a sunflower milk brand. Yes.
Jessica Warden [00:36:19]:
And it’s very yeah. It’s really interesting. And so it’s just really cool to see the innovation in this space. And I think, again, we’ve touched on the fact that a lot of these things aren’t going anywhere because consumers are genuinely adopting them for the long term, it seems like.
Zach Schwindt [00:36:34]:
Right. And I think that brings us to number 1.
Jessica Warden [00:36:38]:
Oh, no. Number 1, drop roll. So that actually we we figured we’d wrap this all up with more of an idea than an item, but it’s just touching base on sustainability, upside equal ingredients, and regenerative organic because those are some of the things that I think really thread the needle through all of the different topics we talked about. For whatever reason, those pieces are pretty much prevalent across items 10 through 2, and so here we go. It’s one that’s transforming the way that we think about food production and consumption, sustainability, upcycled ingredients, and regenerative organic practices aren’t going anywhere. Our industry is really it’s safe to say we’re undergoing a significant shift towards these topics. And, basically, it seems like it’s surrounded around increased consumer awareness about different environmental issues, about growing practices, about processing practices, and just manufacturers and CPG brands based off of what their customers are are asking them for are being called to rethink how they source ingredients and the production methods that are used and the reforestation practices and harvesting practices. So right now, it’s a really exciting time, I think, to be a part of this industry.
Jessica Warden [00:37:56]:
Zach, would you agree that we’re seeing a lot of this around and kind of what we’re
Zach Schwindt [00:38:01]:
Yeah. I mean, I I think that a lot of the, you know, the manufacturers that are moving towards more sustainability and a more sustainable practice, I don’t think they’re just doing it for no reason. I think it’s because consumers are asking them to be more sustainable and they’re listening and consumers are willing to pay a little bit more for more sustainable ingredients, for more sustainable packaging.
Jessica Warden [00:38:23]:
Right.
Zach Schwindt [00:38:23]:
From my own personal perspective, you know, if I have to pay an extra few cents for a little bit better packaging sometime, you know, I’m willing to do that most of the time. So Right.
Jessica Warden [00:38:32]:
Right.
Zach Schwindt [00:38:33]:
Yeah. I think sustainability sources, you know, involves obtaining ingredients in ways that respects the environment, you know, and people both involved respects both the environment and the people involved in their production.
Jessica Warden [00:38:45]:
Right.
Zach Schwindt [00:38:46]:
This can include renewable resources, supporting fair trade practices, ensuring that farming methods do not deplete natural resources.
Jessica Warden [00:38:55]:
Yeah. I agree. And what’s really cool is it seems like regenerative ryanic really started popping up for me, personally, where I was starting to hear it and recognize it maybe 3 expos ago, and then we went back in March again and just the a growth from where it was, like, 1 or 2 boosts. You kind of heard it as floating in the air as a buzzword to this last one where it was everywhere. We saw it in so many places, especially in the organic marketplace. It was every other boost was touting these practices, which is fantastic because I think what it speaks to is is the heart of the people behind our industry and and how they’re it’s not just the consumers demand. It’s like the people that work in those processes are saying, hey. This is a great idea.
Jessica Warden [00:39:40]:
This is something that’s worth investing.
Zach Schwindt [00:39:42]:
Exactly.
Jessica Warden [00:39:44]:
So right there, sustainability really ties into this idea of upcycled ingredients. Zach, maybe you can tell us more what you think of when you hear upcycled. Would you say any of your customers are utilizing this mode of sustainability right now?
Zach Schwindt [00:39:58]:
Yeah. We do have customers, you know, at Smurx that are involved with different upcycled ingredients. And what comes to my mind when when I hear upcycled is basically an ingredient that gets almost a second chance where, you know, it’s maybe destined for the landfill at one point and someone else found a way to make it useful, then therefore, everyone wins.
Jessica Warden [00:40:19]:
So Right. Yeah. I agree. I think one of my favorite examples of it that I stumbled across as a consumer at at the grocery store was the I’m ugly brand. It’s the, you know, fruit that’s was, like you said, destined for the landfill, and somebody found a purpose for it. And it’s hilarious. And so as far as the marketing and the branding goes, it’s just really clever, I guess. Hilarious.
Zach Schwindt [00:40:41]:
Right.
Jessica Warden [00:40:41]:
Clever is the better word to use because it is it’s a great message. It’s a great purpose, and so it’s really cool to see that that’s one of many stories we’re seeing. Upcycling obviously reduces food waste, but it also provides new revenue streams for manufacturers so it can make the overall full circle piece of everything more sustainable and economically more sound while also being environmentally conscious. So it’s kinda nice that it checks so many boxes.
Zach Schwindt [00:41:11]:
Mhmm.
Jessica Warden [00:41:12]:
And then before we end and and as we wrap up and kind of thread everything together again, that ROC, I know we talked about it on one of our podcast before where we talk more generally about it. But, Zach, do you wanna remind us a little bit about what it means if something carries the ROC, or regenerative organic certification?
Zach Schwindt [00:41:31]:
Yeah. So ROC is focused on restoring and enhancing soil health, biodiversity, and the ecosystem resilience. It involves practices like crop rotation, cover cropping, reduced tillage, and holistic livestock management.
Jessica Warden [00:41:46]:
That’s certainly one of those things that we, as a company, when we have customers starting to ask for those ingredients, it’s really cool for us to be able to dig into those processes with our existing partners. So we’re going to our partners that help us with coconut already, and we’re saying, hey. We’re looking for this now, and they’re ready already with an answer. You know? They’re saying, yep. We can offer this. We have coconut sugar that already has been well stabilized under that organic certification, ROC certification. So it’s just really cool to see that it’s not this novel idea anymore. It’s really starting to kinda come to fruition with folks that we’re already working with, and then our customers are adopting it.
Jessica Warden [00:42:23]:
So if there’s any ways that Smirk’s can help you or our listeners with their brands on a project that is calling for that kind of ingredient, feel free to reach out because we’re already kinda working towards that. So I guess I would say that wraps up our Smurk’s top 10 countdown of best bakery trends in 2024. Zach, I have to say it’s been a blast. It’s fun to think about how some of these things have evolved over time since even my time at Smurk’s. But, did you have any last thoughts you wanted to add as we wrap up this segment?
Zach Schwindt [00:42:56]:
I’m just excited to see, you know, how the bakery industry continues to grow. And hopefully next year, IDDBA, we see some 3 d printers that are printing, everything under the moon.
Jessica Warden [00:43:06]:
Yeah.
Zach Schwindt [00:43:06]:
That’s really interesting to 3 d printers. So
Jessica Warden [00:43:09]:
Cool. Well, thank you so much.
Zach Schwindt [00:43:12]:
Yeah. Thank you.
Jessica Warden [00:43:13]:
Well, thanks, Zach. Stay tuned for our next segment where we dive into some of Spark’s products and service solutions where we’ve really helped our customers save money and navigate supply chain issues.
Garrett McBride [00:43:27]:
Hey, everyone. We’re here to dive into segment 2 of episode 13 of the get the scoop with Smirk’s podcast. My name is Garrett McBride, and I’m looking forward to chatting with my colleagues and friends, Jessica Warden and Zach Schwint, about some of the experiences we’ve shared at Smirk’s, supporting our customers with products that fit their needs and budgets and helping engineer supply chain solutions. In this industry, crop and market conditions can and do change quickly. Many of our customers have found themselves in situations where they’re trying to decide when to buy, how long to contract, how to deal with surging commodity prices or ocean freight rates. Here at smerks and quite frankly most aspects of my life I would characterize myself and I think my friends here would agree as being very risk averse. These cautious tendencies come from more than 2 decades of experience in the CPG world working across a multitude of categories and many functional roles. For as long as I can remember, I’ve spent the majority of my professional life managing risks, developing supply chain redundancies, and ensuring product quality all while optimizing product costs, managing operational budgets, and hitting crazy project timelines.
Garrett McBride [00:44:38]:
To our listeners out there who might have the same challenges, we hope this segment will speak to you. Hey, you guys ready to rock on this? Ready to roll.
Jessica Warden [00:44:48]:
Ready.
Garrett McBride [00:44:49]:
So let’s be real. Anyone with a couple of bucks in their bank can buy something from somebody and sell it to somebody else. That’s typically how the world of ingredient trading works. Smirk’s goal is not just to be another transactional cog in your machine. We strive to be a true partner, adding as much value as we can to help your business thrive. One way we do this is by identifying and implementing cost effective product solutions. I have a unique perspective on this topic because before joining the Smurx team, I was a Smurx customer. I’d like to think I was the most important Smurx customer, but that’s arguable.
Garrett McBride [00:45:25]:
In fact, Smurx was one of my primary ingredient suppliers for a number of years. While running ops for a high growth retail brand a few years back, Smurx actually took the time to learn enough about what we were doing in our production to be able to suggest alternate specifications for the coconut oil we were using. This suggestion helped us to significantly reduce product costs while maintaining the same high quality standards that we demanded. It’s that kind of above and beyond service and attention to detail that makes Merck stand out amongst the competition.
Zach Schwindt [00:45:57]:
That’s great insight. Thanks, Garrett. You know, the story that comes to my mind related to vanilla is when we we helped the customer transition from single fold vanilla extract to a double fold vanilla extract. And for those who don’t know, that basically means that they’re they transition to a product that’s twice as strong as the single fold in terms of the flavor. And it saved them a solid 30% by doing so. In a nutshell, the customer was using a generic vanilla extract and they knew vanilla was much more complicated category than they had originally known. And they wanted to use a little bit less liquid in their candy formula. We sent off a few samples of our double fold Madagascar extract, and they found that the product worked fantastic for them.
Zach Schwindt [00:46:43]:
And they were able to use about half of the liquid that they had been using while still getting the exact same amount of vanilla flavor that they were looking for. Specifically because they were using a product with greater strength. It’s really cool to see the project come together full circle.
Garrett McBride [00:47:00]:
Yeah. That’s a great example of how Smirk’s engineer solutions for our partners. Appreciate that example. Let’s talk contracts and contracting. For those of you not aware, Smirk’s has a team of really smart people constantly monitoring dozens of markets to provide you with the best advice possible in real time when it comes to determining when to pull the trigger and how much of a given item to contract. We have a network of contacts all over the world providing data and information about weather, growing conditions, crop conditions, and general supply and demand to help you make the most informed decisions possible. Hey, Jessica. Where do you see Smirk’s adding value to our partnerships?
Jessica Warden [00:47:42]:
That’s a great question. I think one way that we add value is kind of like you mentioned is we take a lot of pride in knowing what’s happening with the markets. It’s such a it could flip on a dime. And and it’s actually one of the things that I’ve come to appreciate about how much Snorx takes time to learn some of this stuff because, like you said, anybody can can trade, but only certain, you know, take certain person who can kinda go in there, look and see what’s happening, have the right connections at origin to really make, I guess, sense out of some of these things and really empower the decision making process at our level, but then also at our customer level. So I think a great example that comes to mind is, you know, how our team has navigated some of the ups and downs of certain markets like coconut, for example. And because of how we’re able to navigate some of those markets, we’ve been able to help customers hedge risk, and a lot of that is really driven by the diversity in our supply chain relationships. So during the pandemic, across the industry, we all saw, you know, the crazy supply chain disruptions. And for me, I was actually brand new to Smarts at the time and brand new to the industry.
Jessica Warden [00:48:53]:
And so I really came to appreciate that time as for the learning curve that I offered, where I really kind of leaned into to watching some of our management team where they focus, making sure they were communicating with customers even when we had bad news. Saw how much it made a difference. Our team was able to continue to honor contracts because we could pivot to another point of origin while still feeling comfortable with the, you know, food safety qualifications of that supply chain simply because we bend boots on the ground at some point or, you know, just had this very thorough process that made us comfortable with some of those decisions. And so now if you flash forward 4 years to today, it’s not a secret that we’ve been experiencing some of this similar supply disruptions in the coconut world that we saw kind of in 2020. So whether it’s ocean free volatility or surges in demand from other countries, shortages of raw material, Coconut has been a a tough one so far this year to navigate, but I think SMERC’s, because of the market information that we took, we really try to take a proactive approach. We saw some of those leading indicators coming into 2024 late last year and early in this year. And so our team made a point to reach out to some of our customers that we knew were heavy users of these items, and we really tried to help them make informed decisions on when it was a good time to buy and when it’s good time to just kinda cover what’s needed. And, really, we just help to be that partner so that, you know, we can get from January 2024 to December and have as minimal disruption as possible.
Jessica Warden [00:50:29]:
And so I think the last piece of the puzzle to understand is that there’s always those things that are beyond our control as an importer, and there’s always things that are out of control down the line of that supply chain. And so that’s very fortunate where our strong supply chain relationships come into play and, you know, on both sides of the coin. So we’re we’re able to source up from multiple coins origin from the same commodity. We’re able to kind of ensure some stability. But maintaining that open and honest communication with our customers, especially when it does come to some of those bad news things that are out of our control, it really helps us navigate everything together. And so even when it’s a true be on market, the different strategic planning and partnerships, we can really continue to deliver value and, in a lot of cases, savings to our customers and just really help with that full picture planning.
Garrett McBride [00:51:23]:
Yeah. I bet you got a career’s worth of of the job training just in those 2 years of COVID. It’s amazing.
Jessica Warden [00:51:29]:
They used to joke about, like, remember before COVID when you could do this and this and this? And I was just like, no. I have no, you know, idea what that’s like. And then now we’ve kinda, you know, got Days are going
Garrett McBride [00:51:38]:
on, and they’re never
Zach Schwindt [00:51:39]:
coming back.
Jessica Warden [00:51:40]:
Normalized times where it’s like, oh, this is what you guys are talking about.
Garrett McBride [00:51:44]:
Yes. Normal. Yeah. It’s Zach, what do you think? Where do you see SMERC’s adding value to our, our partners and our relationships?
Zach Schwindt [00:51:54]:
Yeah. I think, you know, when working on contracts specifically, price, quantity, you know, ingredient specification are all obviously very important pieces. But contract duration, I think, is something that often gets overlooked. For some companies, they prefer to contract January to December, covering a full calendar year. Some cover their needs quarterly. Others contract based off of different crop cycles. For example, during the months of August September, like we’re in right now, we’ll see a lot of the Northern Hemisphere crops being harvested such as sunflower seeds, flaxseeds, most grains, pumpkin seeds, various dried fruits. So at Smurx, I think one of our biggest strong points is that we’ll help you make decisions and how long, you know, to contract because obviously you want to make You want to capture cost savings when you can, but you also don’t want to run yourself short and then not have stock when you need it.
Zach Schwindt [00:52:54]:
So there’s all these different, you know, scenarios that could play out and I think our team is good at sitting down with you and kind of explaining where the market’s at. If your product, for example, contains sunflower seeds and you’re growing at a rate of whatever it is, 30% year over year, you might want to contract a little extra, stuff like that. So just being a partner in the sense of helping you make decisions that are actually going to benefit you. So
Garrett McBride [00:53:21]:
Yeah. I think it’s all about helping the customer and helping our partners navigate any challenge that might come up
Jessica Warden [00:53:27]:
Right.
Garrett McBride [00:53:28]:
You know, particularly on supply chain side. Yeah. I think you’re supply chain challenges Oh,
Zach Schwindt [00:53:33]:
sorry.
Jessica Warden [00:53:34]:
I was gonna interject with conversations relating to
Garrett McBride [00:53:37]:
Please do.
Zach Schwindt [00:53:38]:
I was
Jessica Warden [00:53:38]:
just gonna say that you hit the nail on the head when you talked about, in your example, Garrett, as a customer where Smurk took the time to understand what you were doing as a customer. I think that’s sometimes where our strengths shine through. And then just where we can even grow with customers from start to finish, from when we start working with them to, you know, as that relationship evolves, is trying to find out what you’re doing with the items, how fast you’re growing. Is there a SKU that’s contracting, getting smaller in year over year usage? What does reformulation look like when something’s really expensive 1 year and it’s not as expensive the next year? And so that’s the piece where where Smurx will is willing to sit down with you and look at that stuff and really invest the time into it instead of just take that phone call and say, oh, you need this? Sure. Here’s the price. There you go. Sales out the door. It’s, oh, you’re using this item now.
Jessica Warden [00:54:30]:
Tell me more about it. And so I think that’s where we can really shine with some of our customers.
Garrett McBride [00:54:36]:
Yeah. It’s really huge from, you know, on the branded side, the manufacturing side. So many ingredient suppliers are just that. They supply an ingredient. It’s a transaction. You know, you point a to point b, it’s done. Right. A lot of times in the manufacturing world, the branded side, we don’t know.
Garrett McBride [00:54:50]:
We don’t know if there are other options, if there are better options, if there are less costly options. It’s so helpful to have somebody who’s an expert in the field to provide us with advice and and allow us to make decisions that help to strengthen our business. Right. So that was gigantic from the customer side. Much appreciated. So when it comes to challenges, speaking of challenges, supply chain challenges are constantly popping up everywhere we look. Smirk’s works to ensure that to the best of our ability, we have redundant supply chains for all of our staple ingredients. Coconut products are a great example of that.
Garrett McBride [00:55:29]:
We keep coming back to coconut. As you can tell, that’s a strong suit here at Smerx. We import a large portfolio of coconut products including oils, desiccated coconut, coconut cream, coconut milk, coconut sugar, coconut flour, sounds like Forrest Gump here, coconut butter, coconut aminos, coconut nectar and more. There’s a ton of products that come from coconut and they call it the tree of life for a reason.
Jessica Warden [00:55:56]:
Right.
Garrett McBride [00:55:57]:
In our years of importing coconut products, we pretty much see it all. Over time, we’ve developed and expanded our supply chains to encompass numerous origins that are geographically separated from one another to provide protection when the inevitable issues pop up. We currently have reliable coconut supply chains established in the Philippines, Sri Lanka, Indonesia, and Vietnam. There’s a typhoon in the Philippines, we can pivot our purchasing to Sri Lanka
Zach Schwindt [00:56:24]:
Right.
Garrett McBride [00:56:25]:
Or another origin, for example. Gigantic competitive advantage that Smurx offers over the competition. Smirk’s also encourages our customers to onboard and proactively get their quality assurance approval for multiple suppliers within our supply chain to minimize the risk and to maximize their ability to be agile. We also recommend the customers contract key ingredients whenever it makes sense to do so, not only as means of providing cost stability, but also to help keep our customers and our partners needs met even when conditions aren’t optimal.
Jessica Warden [00:57:01]:
I think that’s one of the, again, one of the places where we add value significantly over, you know, a potential other importer or trader is we take a lot of time internally when we know what our customers’ needs are across the board from everybody that we work with, which helps when we’re contracting. We don’t, you know, always have contracts, but we have a really good idea of what customers are using and how much. But when we can get that more information from our customers and when we have contracts that we know we need to meet, It helps us with planning internally to where we’re able to make very nimble, quick buying decisions in other cases where we wouldn’t be willing to take the risk or maybe another importer wouldn’t be willing to take the risk just because of what we’ve seen. So when we’re planning, there’s a lot of challenges that we kind of, like, take into account. I would say top of year, we were talking a lot about what El Nino was doing. You know, you guys can jump in and touch on that, but we did a lot of internal planning around that. And, Garrett, I think you’re pretty integral in some of that, so you might touch on that a little bit.
Garrett McBride [00:58:06]:
Yeah. This year, El Nino’s impact, that has been very noticeable from various growing regions having reduced yields on the crop side
Jessica Warden [00:58:17]:
Right.
Garrett McBride [00:58:18]:
All the way to the Panama Canal not having enough water to function properly and the need for the authorities over that canal to reduce the number of ships going through every day.
Jessica Warden [00:58:28]:
Right.
Zach Schwindt [00:58:28]:
You
Garrett McBride [00:58:28]:
know, weather has the potential to cause immeasurable impact negatively and positively and we need to be ready to act when something unforeseen like a weather event rears its ugly head. A lot of other things out of our control that we plan around using the geographic diversity of multiple supply chains, geopolitical conflicts like the war in Ukraine
Jessica Warden [00:58:53]:
Right.
Garrett McBride [00:58:53]:
Or really any other unrest in growing regions has the potential to stop shipments from any given area or any given port. And we need to be able to pivot. We need to be agile and have a backup plan for our backup plan so that these things that pop up don’t impact our our partner’s business, in a horrible way.
Jessica Warden [00:59:13]:
Yeah. I I agree. And I think it’s so interesting. Again, just I’ve only been involved in the industry for 5 years. It’s just the things that have popped up in that amount of time. It just shows that there’s it’s always going to be something. Even if you make it through one one conflict or one weather event, then by the time that that clears up, there’s another thing. So if nothing else
Zach Schwindt [00:59:35]:
Mhmm.
Jessica Warden [00:59:35]:
Having the team that we’ve put together with the QA team that we have and then, like, the pieces where we have the risk mitigation and the risk aversion folks on our team along with the people who are very optimistic. And so just having that balance of people on our team is also what makes it interesting where we navigate. It’s like the the human element, I guess, is the best thing that I’m trying to to iterate here is we have a a really fun mix of a team that as we start to kinda look at these challenges, like, oh, that’s how we were able to get through those things.
Garrett McBride [01:00:07]:
And it’s cool because we have a pretty, experienced group here at this point, especially after the last 4 years where crisis management has been like whack a mole. There’s always something. It’s just where is it gonna pop up and when, you know, between all of us and our various experience levels. We’ve seen most of these things and have, you know, a pretty good idea how to navigate the challenges.
Zach Schwindt [01:00:26]:
I
Garrett McBride [01:00:26]:
think we’re pretty well positioned to succeed.
Jessica Warden [01:00:29]:
Zach, any challenges you wanna touch on?
Zach Schwindt [01:00:32]:
I think the new organic regulations have been one that, you know, we saw a lot of brokers For sure. And whatnot that have haven’t quite adapted as fast as as we had hoped they would. Agreed. And then we actually recorded a separate podcast about that as well. But I think that was another area where we took a lot of time to educate both our customers and some of our broker partners and suppliers on meeting these new organic rules. So Yeah. Just being kind of at the forefront of the information has been key for our our team.
Garrett McBride [01:01:03]:
Yeah. Prior planning is so important. And I think that’s something we did pretty well. Definitely. To the
Jessica Warden [01:01:09]:
point where it was like that was, you know, March when that was launched, and it feels like we’ve been talking about it forever because we kinda had been. And so it it feels far away. You know? It’s only August, and it’s new new launch. But Bruce Merck sits like, oh, yeah. That’s in the rearview mirror at this point. So
Zach Schwindt [01:01:24]:
Uh-huh. Right. I mean, do you
Garrett McBride [01:01:25]:
guys think we should touch on any more of these things, or do you think we’re free?
Jessica Warden [01:01:29]:
I think we did.
Zach Schwindt [01:01:30]:
I think it’s pretty good.
Garrett McBride [01:01:33]:
Cool. We’re gonna wrap it up then. Awesome, guys. Really appreciate the input. I think it’s clear that Sperk’s goal here is to be the best partner we can possibly be and support our customers and our partners, you know, at the highest level and to really look out for the success of their business and and the opportunities that they have.
Zach Schwindt [01:01:52]:
I
Garrett McBride [01:01:52]:
wanna thank you all so much for tuning in to episode number 13 of get the scoop with Smercs podcast. Please continue listening to catch our market report for August 2024. Hey there. Welcome to the August 2024 Smirk’s market report. I’m Garrett McBride. I’m filling in for Donnie this month so bear with me. Let’s jump right into ocean freight. We believe right now in August 2024, we are in the middle of the worst of the ocean freight issues from Asia.
Garrett McBride [01:02:22]:
We’ve seen some slight price decreases coming from Asia and that’s encouraging. However, the prices are still way too high. Additionally, I’d like to call out that South America is now catching up. Rates out of South America into the east and west coast of the United States have increased and are are firming slightly. One last thing to call out in Paraguay, the river is low, so this is causing late shipments from that origin. This tends to happen around this time every year, just something we watch and deal with. As far as ingredient markets, let’s start with sunflower. We continue to monitor the extreme heat and the damage it has caused in Eastern Europe.
Garrett McBride [01:03:00]:
All origins are reporting issues with the new crop because of the heat and Bulgaria in particular has been hit very hard. They anticipate 30% less from their new crop than they did a month ago. In the USA, demand has increased as people look to cover while Bulgarian suppliers are off the market. The USA Colonel crop planting was 30% lower than last year as well. We encourage customers to start looking now for their new crop contracts as this could continue to firm up this year. Pumpkin. All reports in China are that we’ll have a large, nice crop. Prices have started to soften from where they were earlier this year as people wait for the new crop to come out.
Garrett McBride [01:03:41]:
In the last few years, booking new crop contracts at the end of August has proven to be a great time and we think this year will be a great time as well. We can start to quote new Shine Skin contracts any day and we are already closing Snow White contracts with several customers. Coconut. The Philippines experienced an early typhoon which added pressure to the market. Most major shippers are still 6 to 8 weeks behind on current shipments and it has been hard to get bookings once containers are ready to ship. The general feeling across the coconut globe is that the market will remain firm with pressure to increase. Most packers are sold out for 2024 already and will introduce pricing for q 1 2025 in the coming weeks. There’s a global shortage of raw material still and we think it’s going to be a while before it catches up.
Garrett McBride [01:04:31]:
Additionally, we are going into the main time of year for typhoons in the Philippines. It is recommended to look at coverage well into 2025 if you can get offers. Smirk can offer for deliveries through June of 2025 right now. Moving along to coconut sugar. The farm gate price for sugar has increased by 30% this year in Indonesia. Processors are having trouble getting NOP certified product that can ship to the USA, and they continue to fight each other at origin for the raw materials, which is driving up costs. Packers are now only looking to offer shipments in November forward and are not sure what pricing to use yet as they don’t know what the price will be at the farm level. It’s important to note that Ramadan begins earlier this year, that being the end of February.
Garrett McBride [01:05:15]:
We may be in the same situation for a while as we don’t know if processors will be able to load up on their current stocks enough to get through Ramadan and to have enough product in process once Ramadan is over. This is definitely an ingredient we want to watch closely for the next couple of months. New crop chia is not coming in as fast or with as good quality as people had hoped for. The market is starting to rise in South America and some packers are staying off the market until they have a better idea of what they’re going to have to offer. We think you should look at getting some of your contracts on the books now, if not all of them. Prices are still pretty favorable compared to past years. We’re also watching the ocean freight from this region. Mango.
Garrett McBride [01:05:59]:
As Mexico had a short crop and other origins were affected by El Nino, we’re waiting for the new crop to begin in Peru in November. We’re starting to work on new crop contracts with customers on organic mango from Peru for cheeks and strips and we think the price for this product will be much lower than that of Mexico as it comes out. Reach out if you’re in need of mango coverage. Once we have a clear picture of Peru, we can offer contracts through most of 2025. Cashews. Cashews remain tight and expensive. Organics are getting harder as raw material is not flowing into Vietnam and there is so much demand for what is there already. Stocks in the USA are very hand to mouth right now as well.
Garrett McBride [01:06:41]:
Smirk’s has positions on organic pieces, organic splits and organic 3 twenties, but they’re getting booked quickly. Please let us know what you might need as soon as possible. Finally, macadamias. Macadamias continue to increase in price and it is very hard to get spot offers. Most packers are sold out for the current crop. Kenyan packers are shipping very late on existing contracts as well. Prices should continue to increase until new crop in 2025, but this product will not arrive in the USA until May or June of that year. Smurx has positions on conventional 1l, conventional 4s, and conventional 6s.
Garrett McBride [01:07:22]:
On organics, we have limited stocks of organic 1l, organic 1r, organic 4, and organic 6. These are all arriving October 4 and selling quickly. Thanks for listening to the August 2024 market update. As always, reach out to us at what’s new at smirks.com anytime for more information. Thanks.
Garrett McBride [01:07:43]:
So that’s it for this episode of Get the Scoop with Smirk’s podcast, where we bring you the latest market reports, insights into bulk ingredients and their origins, as well as in-depth product information.
Garrett McBride [01:07:57]:
So if you have
Garrett McBride [01:07:57]:
any questions, feedback, or just want a feedback, or just want a sample to taste for yourself, visit the smyrks.com website or email us at what’s new at smyrks.com. Never miss a future episode. Be sure to hit the subscribe button wherever you listen to your podcasts. Thanks so much for tuning in.