Growth Opportunities in the Functional Food Ingredients Market

Published Apr 18 



The global Functional Food Ingredients Market size is estimated to be valued at USD 98.9 billion in 2021. It is projected to reach USD 137.1 billion by 2026, recording a CAGR of 6.8% during the forecast period. The inclination toward nutritional and convenience food and the rise in demand for fortified food & beverage products is expected to drive the growth of the functional food ingredients market during the forecast period. However, factors such as adherence to the international quality standards & regulations and lack of awareness about functional ingredients such as prebiotics and probiotics in developing countries act as restraints to the growth of the market.


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The global demand for fortified food is expanding at a robust pace. Functional food ingredients such as vitamins, minerals, antioxidants, hydrocolloids, prebiotics, amino acids, plant extracts, and carotenoids are the key ingredients of fortified food. The health-conscious population is rapidly expanding in emerging markets, which will drive the demand for the fortification of food. The nutritional consumption differences across regions contribute greatly to the apparent differences in the health of populations across the countries. Various factors such as increasing instances of chronic diseases and micronutrient deficiencies, growth of the middle class in emerging economies, new government fortification programs, growth of the world’s older population in regions such as Europe, and growing interest in health and wellness, owing to COVID-19, is expected to drive the sales of fortified foods, further driving the demand for functional food ingredients.


Prebiotics, proteins, omega-3 fatty acids, minerals, fibers, phytochemicals, and plant extracts are the major types of functional food ingredients derived from plant sources. Plant-based proteins are a major source of protein for vegetarians and vegans. Their high nutritional profile, low carbon footprint, and low price are driving their consumption. Soy, corn, pulses, millet, sorghum, sunflower seeds, wheat, groundnuts, barley, and beans are some of the major plant-based sources that are rich in amino acid content. The growing inclination of consumers toward natural and plant-based products has been fueling the demand for plant-based food amino acids over the last few years. Phytochemicals are also derived from plant sources such as fruits & vegetables, nuts & seeds, and spices & herbs, among others.


Functional food ingredients such as vitamins, minerals, and proteins are used in energy drinks. Many energy drinks have been developed by companies to provide specific medical or health benefits, such as promoting heart health, improving immunity, and helping to boost energy. With the broadening range of functional applications being sought by consumers, suppliers are looking to utilize new ingredients that better meet the functional goals of consumers. In the sports drink field, suppliers are expanding their choice of ingredients to enhance sports nutrition benefits. Drinks with creatines and branch-chained amino acids are growing in popularity.


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The North American region dominates the market in 2020. This dominance is driven by the prevalence of chronic diseases due to hectic lifestyles and increasing awareness among consumers regarding the health benefits of functional foods. In addition, the region has the highest prevalence of obesity. The functional food ingredients industry focuses on investing more in research programs with an aim to introduce new ingredients to address the diversified demands from potential customers in the region. The key market players in the North American functional food ingredients industry include Cargill, Incorporated (US), Archer Daniels Midland Company (US), and DuPont (US). These industry players have their R&D centers where they develop a wide range of functional food ingredients for the food & beverage industry. Cargill invested USD 146 million to expand its protein production facility in Nashville, Tennessee, US.


Key players in this market include Cargill, Incorporated (US), BASF SE (Germany), Archer Daniels Midland Company (US), DuPont (US), Arla Foods (Denmark), Kerry Group (Ireland), Ajinomoto Co., Inc. (Japan), Koninklijke DSM N.V. (Netherlands), Ingredion Incorporated (US), and Tate & Lyle PLC (UK). Some of the other players include Chr. Hansen Holding A/S (Denmark), Kemin Industries, Inc. (US), BENEO (Germany), Royal Cosun (Netherland), Roquette Frères (France), Soylent (US), A&B Ingredients (US), Golden Grain Group Limited (China), Sugarlogix (US), and Stratum Nutrition (US).

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