The burgeoning food & beverage industry in BRICS in light of the increased domestic consumption is anticipated to be a major driving factor for the market over the forecast period.
The global food colors market size is expected to reach USD 2.97 billion by 2025, according to a new report by Grand View Research, Inc. Growing demand for colored food products owing to their aesthetic appeal and increasing use in end user industries is expected to drive the demand for food colors over the forecast period.
Growing demand for the product across various industries such as beverages, bakery & confectionary, and dairy products is likely to have a positive impact on the utilization of food colors in the foreseeable future. The demand for food colors for the production of canned products is also estimated to drive the industry growth.
Growing consumer demand for low-fat food is another factors which is expected to supplement the market growth in near future The rising adoption of processed food by consumers across the globe is estimated to translate into the growth in demand of the product. In addition, rising demand for alcoholic and non-alcoholic beverages is likely to drive the market growth over the forecast period.
Rising disposable incomes and changing lifestyles due to rapid urbanization are likely to have a positive influence on the market over the forecast period. Ongoing product innovation, consumer preference for high-quality products, and solidification of government regulations is likely to propel the growth in the next few years.
The absence of any notable substitute to the product results in negligible threat of product substitution. However, the industry is expected to witness internal substitution with natural food colors being increasing used as a substitute for synthetic food colors. The market is expected to witness a degree of uncertainty due to high degree of volatility observed in the prices of raw material.
Further key findings from the report suggest:
- Natural food colors are expected to reach USD 2.50 billion by 2025, owing to growing awareness among consumers regarding the health benefits associated with the product.
- CSDs and non-alcoholic beverages is estimated to be the fastest growing application with a growth rate of 6.4% over the forecast period, on the account of rising demand for juices, soft drinks, and carbonated soft drinks in emerging economies.
- The demand for the product in Asia Pacific is expected to reach a value of USD 868.0 million by 2025 in the wake of growing food and beverage industry in the region.
- The companies have adopted different approach to compete with each other. For example, Allied Bioitech Corporation have adopted a mono-product approach. It is global supplier for carotenoids and manufactures & distributes only on product.
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Over the past few years, governments of Spain and Germany have launched and successfully implemented numerous campaigns to promote healthier lifestyles by introducing innovative health products to reduce obesity, cholesterol, and diabetes. This trend is expected to play a crucial role in the promotion of natural food colors in consumables.
The market is expected to exhibit a low threat of new entrants on account of extensive portfolio offered and distribution network operated by existing players, which results in a high entry barrier for the new entrants. Besides, the high switching cost for the buyers makes it difficult for new players to gain a significant market share, thereby lowering the threat of new entrants.
Concerns raised by consumers regarding the use of natural carmine extracted from cochineal insects are encouraging the manufacturers to seek other alternatives. With LycoRed producing its Lyc-O-Beta carotene orange color through the fermentation of the Blacksiea trispora fungus, Chr. Hansen is also trying to manufacture carmine through a similar process. Companies are also searching for alternatives owing to the fluctuating prices of carmine.
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Natural food color is estimated to be the largest product segment accounting for over 80% of the total market revenue. The demand for this product is increasing substantially worldwide owing to the growing awareness among consumers regarding the health benefits associated with natural food colors.
The market for synthetic food colors is expected to grow on account of growing product use by consumers across the developing economies. Besides, the demand for synthetic colors, such as green and blue, is expected to be driven primarily by their use in the beverage manufacturing industry. However, rising substitution by natural colors may hamper industry growth.
About Grand View Research
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