It's been a week since I started some cake and cookie decorating, and normally one needs many colors to come up with a lovely colorful final result whether it is Butter cream, royal icing or fondant. So I'd avoid using artificial food coloring as much as possible. Searching the web, I found a few articles suggesting to use different fruits/vegetables to make homemade/natural food coloring but I am not positive it will work since other than the flavor, it means adding too much liquid. Is there any way to avoid artificial food coloring without the aforementioned problems?
Natural food coloring kits, consisting of powdered concentrates, are available at health food stores in some regions, eg http://shop.biovegan.de/biovegan-farbspass-farbende-lebensmittel-5x8g is common here... and in this case, there is no cochineal in there, since insects/arachnids do not widely qualify as vegan, and this brand (as the name says :) specializes in organic and vegan products.
Turmeric, Annato, mild paprika and similar spices color extremely strongly, one would need to add little enough not to mess with the cake chemistry. Coloring juices (beet or blueberry juice etc) could be cooked down to a high concentration. Some of these color differently based on pH (turmeric, anthocyanins like beet juice), but one might need to compensate taste-wise for the colored layer being alkaline or at least less sour than one would prefer...
Turmeric, especially fresh, can help with the brightness even if you aren't aiming for yellow - stuff's strongly flourescent (means: will emit visible light when excited by ambient ultraviolet light) and will make everything appear more radiant in sunlight and many types of artificial lighting. Same would go for quinine (as can be found in certain drinks) if the food can take the bitterness, but quinine has more of a blue flourescence that won't come across as very bright.
If you want to avoid food colors (both natural and artificial additives;; thees with "E number") you can use natural food colors or in EU "coloring foods". There is a wide range of fruit and vegetable concentrates that provides colour to food without the use of any chemicals for the extraction of the pigment. Have a look at www.gnt-group.com. In the case of cake decoration like fondant, you could use both a powder or a liquid form of a colouring food, which is enough concentrated (around 70°Brix) to add low humidity and provide nice colors. Some of the raw materials used are: For red-pink-purple shades: purple sweet potato, purple carrot, radish, (be aware that pH to achieve nice, stable pink/red should be acidic, below 4.5). Higher pHs make the anthocyanins more bluish. Red beetroot is more stable (keeps the red shade) at higher pH. For yellow-orange shades: yellow/orange carrots, safflower, pumpkin and red pepper. Specially in presence of fat, the carotenes shift to a warm yellow, so pumpkin or red pepper extract/ concentrate can give a pretty nice mango yellow shade. Turmeric gives a shiny yellow as explained by a user but it's quite light sensitive and disappears relatively quick (some days to light exposure). For green shades: here I would use a mix of (yellow) safflower (be aware in US is still not recognized as natural food color) or pumpkin with the (blue) spirulina (a microalgae cultivated in lakes). *In case you want to achieve a warmer red shade, you can also combine some red pepper/paprika extract with some radish extract. If you want to make the colors yourself just take into account that you have to cook and evaporate the water up to a syrup by adding some sugar and mostly some citric acid (to keep the microbiological stability and protect the pigment).