Throughout 2008, the economic impact on the tortilla market vacillated. The rising cost of raw ingredients proved challenging while more consumers making meals at home was a boon.

“Because of rising raw ingredient costs, many changes I saw last year were end customers downsizing orders. Some customers began asking for slightly smaller tortilla packages. It was either increase your prices or reduce your count or individual product size. We saw that with corn items, but not with flour,” says Helen Chavez-Hansen, president and founder of La Tapatia Tortilleria, Fresno, Calif.

However, as the recession drives more consumers to cook at home, traditional flatbreads, such as flour and corn tortillas, are seeing an increase in demand.

“The corn tortilla is branching out beyond ethnicities, entering U.S. households for their natural health benefits. They are low fat, low sodium, high fiber alternatives to wheat/flour-based bread products. Consumers are finding new, unique ways to incorporate corn tortillas into their diets beyond Mexican cuisines,” says Alberto Gonzalez, senior vice president-marketing, Mission Foods, Irving, Texas.

The fluctuating tortilla market also has taken a toll on equipment manufacturers. “While the market did take a dip, today our customers are asking for equipment that will allow them to produce more products at a higher rate of speed, reduce overhead and reduce energy costs at the same time,” says Ron Meade, C.E.O., Casa Herrera Inc., a manufacturer of tortilla equipment in Pomona, Calif.

Beyond borders

To help stabilize sales and limit the recession's impact, U.S. tortilla makers are looking beyond the country's borders.

“On the domestic side, the supermarket area is very good right now in all of California and throughout the Pacific [Coast],” Chavez-Hansen says.

Casa Herrera is seeing a 3 to 5 percent growth in the flour tortilla production area in the United States. However, in the United Kingdom and Europe, it is seeing 22 to 25 percent growth in some markets, Meade notes.

Helping spur the growth in the United Kingdom and Europe is the diversity of the population, as flatbread is a staple for many ethnic diets.

The growth for flour tortillas in these regions is spurred by convenience, flavor and utility. A consumer decides to try a package of tortillas rather than make their own flatbread at home and likes them. Then they start using tortillas instead of baking from scratch. “There's a lot of crossover growth going on in Europe and the UK,” Meade says.

For Mission Foods, knowing what sells in certain markets is key to weathering the economic storm. For instance, flour tortillas and wraps tend to be the most popular with consumers in the Northeast and Southeast, but sales of corn tortillas are higher on the West Coast.

The industry also is beginning to reach a new base of consumers that are entering the category due in part to the explosion in wraps and tortilla menu items at QSR and fast casual restaurants. This trend is a great opportunity for growth, Gonzalez says.

Addressing changing lifestyles

While offering a full spectrum of tortilla products, Mission Foods also is filling consumers' desire for more healthful versions. Several new lines of flour tortillas have helped the company capture additional sales as consumers' attitudes have shifted about health and nutrition and the way tortilla products are used. “Mission Foods' Plus! Line of tortillas including Life Balance™, multigrain, 96% fat-free and Carb Balance^® have helped consumers view tortillas in a totally different light and given them permission to use these products in new, healthier ways,” Gonzalez says.

“One Life Balance tortilla has as much calcium as a glass of milk, or 20 percent of the daily recommended intake. It also contains DHA omega-3, which is one of the most significant contributors to brain health,” he adds.

La Tapatia also is addressing consumer health concerns. “We always use canola oil in our tortillas, and we are very well known for our stone ground yellow corn tortillas. We make our changes internally, becoming more efficient with equipment improvement and training programs. If you do a good job inside and turn out a good product, you have a good loyal customer base,” Chavez-Hansen says.

Because of increasing demand for more environmentally friendly production methods, Casa Herrera is seeing a growing demand for its latest Odyssey ovens. “These are a unique, proprietary design to us and a real energy saver for our customers. The Odyssey oven is drawing continuing interest, as people become more energy conscious. It is much more efficient to operate than a traditional flour or corn tortilla oven,” Meade says.