Food Additives

Driving factors in the food additives market

Global Industry Analysts (GIA) has released a global report on the Food Additives markets that, globally, are projected to reach $37.7 billion by 2018, driven primarily by the increased focus on health and nutrition; the emergence of value-added products; the need for convenience; and the commercialisation of new products, among others.

Food additives represent a global, multi-billion dollar market, dominated by additive categories, including flavour and flavour enhancers, hydrocolloids, acidulants, and emulsifiers.

There are several factors that are directly or indirectly driving the global food additives market. These include concerns related to food safety; health and nutrition, especially the need to control the spread of diabetes, obesity and food allergies; the emergence of value-added products; the need for convenience; the continued increase in raw materials and energy costs; commercialisation of new products; and the need to make significant investments in research and development and in securing regulatory approvals.

Other factors driving the food additives market include the adoption of sophisticated food processing methods by developing countries, restructuring of food processing companies, and a demand for more complicated food ingredients by processors.

Consumer preference is clearly favouring natural additives over synthetic additives. The categories benefiting the most and also affected the most due to the “naturals” trend include colors and flavours, where natural additives are gaining over synthetic additives.

For instance, despite the higher cost and limitations, natural colourants are witnessing robust growth in the food colourants market. The trend is more or less similar in the flavours and flavour enhancers market, where demand for natural flavours is driven by consumer perception that naturals have health benefits. Natural flavours and flavour enhancers, such as monosodium glutamate and ribonucleotides, are likely to benefit from this trend.

However, this trend has given rise to a situation where food additive makers are being pressurised to develop additives from natural sources, which is proving to be a daunting task for manufacturers operating in this space.

Another prominent trend stimulating market expansion is the growing consumer fondness for the highly-processed food products, making food makers demand more customised solutions from food additive suppliers. Additionally, there is a continuing trend towards low-calorie, low-fat foods favouring additives that help reduce overall fat content in foods. This trend is benefiting additives, such as sweeteners, emulsifiers, hydrocolloids, and vitamins and minerals.

Going forwards, innovations in food products and new processes, government regulations, and consumer awareness about health and hygiene would continue to influence the global food additives market. While consumers dictate trends in foods and beverages, the food additives market is expected to face all-too-familiar challenges in future. These may include delivering foods to new markets quickly and cheaply, developing quality products at affordable rates, adopting new packaging techniques, and increasing consumer awareness regarding the safety of new preservation methods.

The US dominates the global market, states the new report. Americans are particularly conscious of the calorie content, and hence low-calorie, low-fat foods are popular in the US. This indicates a growing demand for food additives, such as fat replacers, artificial sweeteners, and hydrocolloids.

The US remains the largest market for flavours and flavour enhancers. Regionally, the fastest growth is expected to emanate from the Asia-Pacific region, with countries such China and India expected to be chief contributors spearheading growth in the region.

Growth in the food and beverage industry, improvement in trading scenario, and increase in foreign-local joint ventures are providing the necessary impetus to the food additives industry in the Asia-Pacific region.

Flavours and flavour enhancers represent the largest segment in the global food additives market. Acidulants represent the fastest-growing market, registering a compound annual growth rate of 5.6% over the analysis period. Other segments exhibiting encouraging growth potential include fat replacers, emulsifiers, hydrocolloids, and enzymes.

The global food additives industry is highly fragmented, with a wide range of products and large number of players addressing a single end-user, the food industry. There are all sizes of additive makers, including small-, mid- and large-size, operating in the industry with each having a different product and market focus.

Key players profiled in the report include Ajinomoto, Ashland, Archer Daniels Midland Company, Associated British Foods, ABF Ingredients, ACH Food Companies, PGP Internationa, AVEBE, BASF, Cargill, Chr. Hansen A/S, CP Kelco U.S., DuPont, Edlong Dairy Flavors, Royal DSM, Firmenich, FMC BioPolymer, GELITA, Ingredion, Givaudan, Griffith Laboratories, International Flavors & Fragrances, Jungbunzlauer, Kalsec, Kraft Food Ingredients, Land O’Lakes, McCormick & Company, Novozymes, NutraSweet, Purac America, Red Arrow Products, Rudolf WILD, Sensient Technologies, Sethness Caramel Color, Symrise, Takasago International, Tate & Lyle, and TIC Gums, among others.

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