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PepsiCo, Inc. (PEP), Fresh Del Monte Produce Inc (FDP), The Coca-Cola Company (KO): Stevia Company Stocks May Rise As Sugary Juices Come Under Fire

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The fruit and vegetable juice industry is BIG: It’s a $20 billion market, and now (just like sodas) it’s coming under attack for its excessive amount of sugar.  As sugary sodas were receiving the bulk of the blame for the obesity epidemic, obesity expert, Robert Lustig, who penned the book “Fat Chance: The Bitter Truth About Sugar,” was espousing that the high sugar content in commercial fruit juices were as sugar-laden as soda.  Over the past 30 years consumption of fructose – the sugar in juice – has more than doubled as parents, looking for a healthy alternative to sweetened drinks, gave their children more and more juice to quench their thirst.

JUICE IS AS MUCH A CULPRIT IN THE OBESITY EPIDEMIC AS SUGARY SODAS

Mr. Lustig states that it doesn’t matter whether the sugars are from fruit juice, smoothies or soft drinks, liquid fructose sugar is dangerous for one’s health, and it is overloading the liver and creating issues such as obesity, which leads to heart disease, diabetes, and other medical issues.  The problem with fruit juice is the fiber has been removed, and the fiber forms a protective layer that acts as a barrier to the intestine slowing the absorption of sugar, giving the liver a chance to catch up.  In sodas, fruit juices, and smoothies, the barrier is gone, which leads to the liver being overloaded.

Eight ounces of orange juice contains 24 grams of sugar, only two grams less than found in the equivalent amount of Coke.  An eight-ounce glass of apple juice contains 26 grams of sugar, the same amount of sugar found in the equivalent amount of Coke.  An even more frightening comparison is these juices have the equivalent in sugar to a little more than two Krispy Kreme Doughnuts (NYSE:KKD) glazed doughnuts, which have 10 grams of sugar per doughnut.

STEVIA BLENDS IN NEW JUICE PRODUCTS

While I’m not suggesting skipping the juices and eating the doughnuts, clearly fruit juices are no better than sodas in terms of sugar, even though the sugar comes naturally in the product, and has clearly added to the obesity epidemic.  And that’s why companies like PepsiCo, Inc. (NYSE:PEP)’s Tropicana with its Trop50, that boasts 50% less sugar than regular juice, may be ahead of its time seeing that juices have come under the same scrutiny as sodas as one of the major culprits in the obesity epidemic.

PepsiCo, Inc. (NYSE:PEP)Trop50 is not the only product on the market that is addressing the sugar issue in juicesFresh Del Monte Produce Inc (NYSE:FDP) has a line of juices that, just like Trop50, are sweetened with stevia and contain 50% less sugar.  Sold primarily in England and available in three flavors– Mango and Papaya, Pineapple and Lime, and Super Fruits– Fresh Del Monte Produce Inc (NYSE:FDP)’s brand, Naturally Light, has been a hit.  “We have listened closely to consumers’ health concerns and know that there is a real demand for healthy, natural drinks with lower sugar and calories,” says Tony Gill, Del Monte UK commercial director. “Fresh Del Monte Produce Inc (NYSE:FDP) Naturally Light, with its high juice and low calorie content, offers people an easy way to drink more healthily. It is fantastic to know that it is enjoyed by so many and that it is the UK’s soft drink of choice.”

To give the customer a healthier product, U.S. fast causal restaurants like Panera Bread Co (NASDAQ:PNRA) have added stevia to sweeten some of it teas.  The Company’s 2013 Featured Summer Menu includes a tropical Hibiscus Iced Tea with natural pineapple and lychee flavor and sweetened with stevia.  Jamba, Inc. (NASDAQ:JMBA) has also added stevia in three new energy drinks, touting only 90 calories per serving.  Jamba Juice also added stevia to help sweeten its take-home Smoothie Kits in an effort to lower the sugar and calorie count.

COMING SOON: BETTER TASTING STEVIA

While it is imperative to our health to cut down on sugar, I foresee that stevia in juices will have two obstacles to overcome before it will be truly embraced, and that is the flavor profile and the cost. While some complex beverages, such as Starbucks Corporation (NASDAQ:SBUX) refreshers found on grocery shelves, can mask the bitter aftertaste found in today’s stevia products, most juice blends seem to have too delicate of a flavor to overpower the bitterness.  The stevia extract used in most products comes from rebaudioside A (Reb A), the sweetest and most abundant of the steviol glycosides found in the stevia leaf.  However, there are other steviol glycosides, like Reb D and Reb X, that have been found to have a better sweetener profile that may blend more effectively than Reb A in juices.  The problem is that both of these glycosides are found in trace amounts in the leaves, which makes extracting the glycosides far more costly.

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