Speciality Food Ingredients - Market Insights, Competitive Landscape, and Market Forecast - 2027

Speciality Food Ingredients - Market Insights, Competitive Landscape, and Market Forecast - 2027

Speciality Food Ingredients Market By Type (Sweetener & Flavours, Colorants, Preservatives, Emulsifiers, Enzymes, And Others), By Application (Food & Beverages [Bakery & Confectionery, Sauces, Dressings, & Condiments, Dairy Products, Frozen Processed Food, And Others], Pharmaceutical, Personal Care, And Others), and by geography is expected to advance at a considerable CAGR forecast till 2027 owing to the growing demand for organic and natural specialty food ingredients across the globe and rise number of pharmaceutical and food industry across the globe

The global speciality food ingredients market was valued at USD 125.11 billion in 2021, growing at a CAGR of 6.15% during the forecast period from 2022 to 2027 to reach USD 178.59 billion by 2027. The specialty food ingredients market is observing remarkable market growth primarily owing to the growing demand for organic and natural specialty food ingredients across the globe. Further, the increasing consumer spending on personal care products, increasing penetration of e-retail to assess the products easily, rising consumer awareness towards multi-purpose and clean-label pharmaceutical and food-related products along with the increasing launches of ingredients and final products in the market, presence of key players, and others will create a demand for the specialty food ingredients in the market. Therefore, the market for specialty food ingredients is estimated to grow at a substantial CAGR during the forecast period from 2022 to 2027.

Speciality Food Ingredients Market Dynamics:

One of the key factors responsible for driving the specialty food ingredients market is the growing demand for organic and natural food ingredients globally.

For instance, the demand for natural specialty food ingredients that are used in the food, beverages, bakery, and pharmaceutical industries is growing as natural specialty food ingredients do not cause any serious side effects to the consumers owing to which various companies are incessantly replacing synthetic chemicals with the natural form of specialty food ingredients, partly because of consumer demand and partly because of the moving awareness towards sustainable and natural raw materials.

Further, the specialty food ingredient industry essentially thrives on the broader technological and functional benefits that these ingredients confer on processed food products in terms of high quality, safety, affordability, nutrition, and deliciousness.

Also, the growing popularity of ready-to-cook and ready-to-eat food products is driving the global market for preservatives, a type of specialty food ingredient. Moreover, with the clean label trend thriving in many consumer product categories many companies are continuously launching many foods in the market. For instance, in August 2021, Conagen, a Massachusetts-based biotech company, announced the launch of p-Coumaric Acid (PCA), a natural preservative, which can be used in the food & beverages industry.

Additionally, according to the latest study provided by Food & Agricultural Organization (FAO) in Italy, the world population is expected to increase to 9.7 billion in 2050, which in turn will increase the demand for food, beverages, bakery, and other items, thereby raising the demand for specialty food ingredients.

Furthermore, the specialty food ingredient market and the processed food market have a strong correlation, with the former providing functional benefits and customized value-addition based on end-user applications. Smart technology or intellectual property is used by globally recognized companies that manufacture specialty food ingredients to develop innovative ingredients and solutions.

Moreover, the increasing activities by the key players in the market will aid in increasing the demand for specialty food ingredients in the forthcoming years. For instance, in December 2021, ICL Specialty Products Inc. opened its new USD 18 million alternative-protein facilities and other specialty food & nutraceutical ingredient facilities. It is the company’s first-ever plant-based protein facility that will address the food sustainability problems and will produce plant-based meat substitutes for food companies, distributors, restaurants, and grocery chains. It is expected that the facility will make more than 15 million pounds of product annually at full capacity.

Therefore, the factors stated above collectively will drive the overall specialty food ingredients market during the forecast period from 2022 – 2027.

However, the side effects associated with chemical-based specialty food ingredients, stringent government regulations, and others may halt the growth of the specialty food ingredients market during the forecast period (2022 – 2027).

The unprecedented COVID-19 pandemic had a slightly negative effect on the specialty food ingredients market. This is because, during the initial days of the pandemic, several industries had stopped their production units and other operations owing to the imposition of strict lockdown rules by the government. Also, the lockdown across the globe and the stringent regulations on import-export trade activities that had led to the containment of the virus, disrupted the global supply chain, thereby disturbing the manufacturing of specialty food ingredients in the market. Contrarily, the e-commerce channels in the second phase of the pandemic had effectively improved the demand for natural and organic specialty food products across the globe, thereby enhancing the demand for specialty food ingredients, in turn affecting the specialty food ingredients market growth.

Speciality Food Ingredients Market Segment Analysis:

Specialty Food Ingredients Market by Type (Sweetener & Flavors, Colorants, Preservatives, Emulsifiers, Enzymes, and Others), Application (Food & Beverages [Bakery & Confectionery, Sauces, Dressings, & Condiments, Dairy Products, Frozen Processed Food, and Others], Pharmaceutical, Personal Care, and Others), and Geography (North America, Europe, Asia-Pacific, and Rest of the World).

In the by type segment of the specialty food ingredients market, the colorants segment is expected to have a significant revenue share in the year 2021. This was primarily owing to the increasing demand for natural colorants for various food and pharmaceutical products.

Although natural colors are safer, they do have some fictitious issues, such as consistency. The production of such colors is expensive, and raw materials are in short supply. Natural colorants are used in a variety of functional food products.

Many processed foods contain food colors, including candies, snack foods, margarine, cheese, soft drinks, jams/jellies, gelatins, pudding, and pie fillings. For instance, paprika is a ground natural food color made from chili peppers (capsicum). It is used as a garnish in many recipes to add color. Thus, the increasing application of such colorants will increase their demand in the market.

Also, the launch of several new colorants in the market will raise the demand for colorants, thereby driving the overall market growth of personal ingredients. For instance, in September 2021, Indian company Divi's Nutraceuticals launched ""CaroNat,"" a naturally-sourced food ingredient intended for the dark yellow to orange coloration of various food and beverage products, including the application in the dairy industry.

Therefore, owing to the above-mentioned factors, the demand for the colorants upsurges, thereby the category is expected to witness considerable growth eventually contributing to the overall growth of the global specialty food ingredients market during the forecast period.

North america is expected to dominate the overall Speciality Food Ingredients Market:

Among all the regions, North America is expected to hold the largest share in the global specialty food ingredients market in 2021 and is expected to do the same during the forecast period from 2022-2027.

This can be ascribed to the increasing demand for specialty food ingredients among the region owing to the growing demand for organic and natural specialty food ingredients, increasing consumer spending on personal care and healthcare products, the rising launch of specialty food ingredients, the increasing consumer demand for clean-label products, presence of domicile players in the region, and others will be contributing to the growth of the specialty food ingredients market in North America.

Moreover, the American population is becoming more health-conscious, which increases the demand for healthy food products. As a result, manufacturers tend to launch new products containing specialty food ingredients. Also, because of the increased awareness of food quality, specialty foods are outpacing their non-specialty counterparts in almost every category.

Furthermore, the US Food and Drug Administration (FDA) regulates specialty food ingredients, such as sugar substitutes used as food additives. For instance, before a sugar substitute in foods and beverages, the FDA must review scientific evidence to ensure its safety. Sugar substitutes like Acesulfame K, Advantame, Aspartame, Neotame, Saccharin, and Sucralose have been approved as food additives by the FDA in the United States. Consumers are turning to natural and zero-calorie sweeteners like stevia as they become more concerned about the prevalence of obesity. Thus, such favorable regulations by the government in the region will upsurge the market of specialty food ingredients.

Furthermore, the consumption of sugar substitutes, such as xylitol, erythritol, and mannitol, a type of natural sugar, is increasing rapidly across North America owing to consumer awareness, government regulations to reduce sugar consumption and application in many health and wellness food products in the market. Such factors are driving the specialty food ingredients market across the region.

Therefore, the interplay of the aforementioned factors above would provide a conducive growth environment for the North America region in the specialty food ingredients market.

Speciality Food Ingredients Market Key Players:

Some of the key market players operating in the specialty food ingredients market include Kerry Group plc., Associated British Foods plc, Arla Foods, DSM, Tate & Lyle, KYOWA HAKKO BIO CO., LTD., Ingredion Incorporated, ADM, DuPont, Cargill, BASF SE, Anagenix, Molkem, Danone, Roquette Frères., Martin Bauer, Sydler India Pvt. Ltd., Probi, Balchem Inc., Barrington Chemical Corporation, and others.

Recent Developmental Activities in the Speciality Food Ingredients Market:

In September 2022, Royal DSM signed an agreement to acquire First Choice Ingredients, a leading supplier of dairy-based savory flavorings, for an enterprise value of USD 453 million. First Choice Ingredients is the developer of clean-label, fermented dairy and dairy-based savory flavorings for taste and functional solutions across various applications.

In June 2021, Cargill and HELM entered into a joint venture, Qore, to help leading brands replace fossil-based chemistries with bio-based intermediates, enabling them to reduce their greenhouse gas emissions.

Key Takeaways from the Speciality Food Ingredients Market Report Study

Market size analysis for current specialty food ingredients market size (2021), and market forecast for 5 years (2022-2027)

The effect of the COVID-19 pandemic on this market is significant. To capture and analyze suitable indicators, our experts are closely watching the specialty food ingredients market.

Top key product/services/technology developments, mergers, acquisitions, partnerships, and joint ventures happened for the last 3 years

Key companies dominating the global specialty food ingredients market.

Various opportunities available for the other competitor in the specialty food ingredients market space.

What are the top-performing segments in 2021? How these segments will perform in 2027.

Which are the top-performing regions and countries in the current specialty food ingredients market scenario?

Which are the regions and countries where companies should have concentrated on opportunities for specialty food ingredients market growth in the coming future?

Target Audience who can be benefited from this Speciality Food Ingredients Market Report Study

Specialty food ingredients providers

Research organizations and consulting companies

Specialty food ingredients -related organizations, associations, forums, and other alliances

Government and corporate offices

Start-up companies, venture capitalists, and private equity firms

Distributors and traders dealing in specialty food ingredients

Various end users who want to know more about the specialty food ingredients market and the latest developments in the specialty food ingredients market.

Frequently Asked Questions for the Speciality Food Ingredients Market:

1. What are specialty food ingredients?

The specialty food ingredients are specially used for color, texture, mixing, and preserving food products. The ingredients improve the nutritional properties of the food and processed food.

2. What is the global market for specialty food ingredients?

The global speciality food ingredients market was valued at USD 125.11 billion in 2021, growing at a CAGR of 6.15% during the forecast period from 2022 to 2027 to reach USD 178.59 billion by 2027

3. What are the drivers for the global specialty food ingredients market?

The specialty food ingredients market is witnessing positive market growth owing to the factors such as the growing demand for organic and natural food ingredients, increasing consumer spending on personal care and healthcare products, rising consumer awareness towards multi-purpose and clean-label products, increasing penetration of e-retail worldwide, increasing new ingredients launches and approvals, presence of key players in the market, and others will create an exigency for the specialty food ingredients market.

4. Who are the key players operating in the global specialty food ingredients market?

Some of the key market players operating in the specialty food ingredients market include Kerry Group plc., Associated British Foods plc, Arla Foods, DSM, Tate & Lyle, KYOWA HAKKO BIO CO., LTD., Ingredion Incorporated, ADM, DuPont, Cargill, BASF SE, Anagenix, Molkem, Danone, Roquette Frères., Martin Bauer, Sydler India Pvt. Ltd., Probi, Balchem Inc., Barrington Chemical Corporation, and others.

5. Which region has the highest share of the Speciality Food Ingredients market?

Among all the regions, the North America is estimated to hold the major revenue share in the global specialty food ingredients market. This can be ascribed to the growing demand for organic and natural food ingredients, increasing consumer spending on personal care and healthcare products, the rising launch of specialty food ingredients, the increasing consumer demand for clean-label products, and the presence of domicile players in the region are the reasons which acts as a supportive factor for the North America specialty food ingredients market growth.

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