Global Food Processing and Manufacturing (FPM) Contract Manufacturing Market 2022-2028

Global Food Processing and Manufacturing (FPM) Contract Manufacturing Market 2022-2028

Global FPM contract manufacturing market size was $89.5 billion in 2021 and is anticipated to grow at a significant CAGR of 9.2% during the forecast period. Major factors contributing to the growth of the global FPM contract manufacturing market include a rapid influx of new product varieties due to increasing demand for innovative food products across the globe. The lack of manufacturing production capabilities of OEM (original equipment manufacturer) and growing demand for convenience food due to lifestyle changes are fueling the market growth. Stringent regulatory policies for the approval of food products and increasing risk associated with the quality of the product are some of the factors hindering the growth of the market. Some of the other factors responsible for restraining market growth are the increasing cost of raw materials. However, emerging markets and the introduction of automation technology in food production decrease the manual work which is expected to create enormous opportunities for the market shortly.

In food processing and manufacturing, a company can outsource products or raw materials that enable their food processing business to be always competitive in the initial stage or during growth.Providing the contract to another business for the packaging of their food product can eliminate the need to invest highly in broad equipment or employ additional staff when there is a low cash flow. Thus, small food manufacturers such as Peter Greven provide outsourcing services to a well-equipped businesses. Moreover, several contract manufacturing firms are existing in the food sector, including Kilfera Food Manufacturers Ltd., PacMoore Corporation, and Hearthside Food Solutions LLC.

Impact of COVID-19 Pandemic on Global FPM Contract Manufacturing Market

Covid-19 has impacted the market owing to across the globe food availability was there but due to lockdown and border restrictions the supply chains were completely disrupted. Moreover, increasing demand for processed food items in the market has created opportunities for the new contractors for contract manufacturing. Furthermore, the COVID-19 has made all the manufacturers operating in the market implement new processes to ensure they remain operational and are protecting the health and safety of their workforce as the spread of COVID-19 and lack of workforce.

Segmental Outlook

The global FPM contract manufacturing market is segmented on the basis of services. Based on services, the market is sub-divided into manufacturing services, packaging services, and research and development services. Manufacturing services holds the largest market share owing to increasing number of innovative manufacturing services offered by contract manufacturer due to the rapid increase in the demand of food products.

The Manufacturing Services Segment is Dominating the Global FPM Contract Manufacturing Market

Among these manufacturing services is holding a prominent share owing to it includes the manufacturing of different types of products including convenience foods, bakery products, dietary supplements, confectionery products, dairy products, and others. Manufacturing services holds the largest market share owing to the increasing number of innovative manufacturing services offered by contract manufacturer due to the rapid increase in the demand for food products. Moreover, several food companies in the market are looking to enhance value and efficiency-based food products as the consumer demand has been increased goof products with high nutritional levels. In addition, the increasing e-commerce platform and private sector investment and the companies also play a vital role concerning they offer specific recipes for food processing are such major factors propelling the market growth.

Regional Outlooks

The global FPM contract manufacturing market is further segmented based on geography including North America (the US, and Canada), Europe (UK, Italy, Spain, Germany, France, and the Rest of Europe), Asia-Pacific (India, China, Japan, South Korea, and Rest of Asia), and the Rest of the World (the Middle East &Africa, and Latin America. North America is expected to dominate the food processing and manufacturing market due to increasing trends toward outsourcing food processing and manufacturing services in this region and it is followed by Europe.

The Asia-Pacific Region is Fastest Growing in the Global FPM Contract Manufacturing Market

The Asia-Pacific is expected to be the fastest growing region during the forecast period due to the presence of a large number of mass food manufacturers in this region. Moreover, the increasing population, growing household income, and industrialization in emerging countries and it has transformed the food industry.Additionally, the growth in the region is attributed to the shift of major food key companies operating in the industry towards production facilities and expansion. Furthermore, strategic investments that are aimed to leverage the growing capabilities and strengthen manufacturing networks in the Asia Pacific to fulfill the increasing demand of consumers coupled with it, such factors are contributing to the AsiaPacific FPM contract manufacturing market growth over the forecast period.

Market Players Outlook

The competitive landscape includes key strategies of leading players, recent developments, and key company analysis. The major players that contribute to the growth of the market include - Nutrascience Labs, Inc., Nu-World Foods, NVE Pharmaceuticals, Inc., Pacmoore Products Inc., Thrive Foods LLC., Tree Top Inc. And Van Law Food Products Inc., and many others. The market players are considerably contributing to the market growth by the adoption of various strategies including mergers and acquisitions, partnerships, collaborations, funding, and new product launches, to stay competitive in the market. For instance, in May 2021, the Ministry of Food Processing Industries issued guidelines and launched an online portal for 'Production Linked Incentive Scheme for the food processing Industry the implementation of this new guideline is for 2021-22 to 2026-27 with the support of Rs. 10,900 crore for the support and creation of global food manufacturing champions commensurate and it will support Indian brands of food products in the international markets.