Global Specialty Food Ingredients Market Grows Steadily at a CAGR of 5.1%

Introduction

The term "specialty food" refers to a "distinctive, high-value food product made in small quantities with premium ingredients." Typically, specialty food ingredients preserve texture, emulsify, color, aid in processing, and add a health component to processed foods. These factors are essential for ensuring consumers access various processed foods today. Specialty foods contain macro- and micro-ingredients, ranging from proteins, lipids, carbs, and fibers to micro-ingredients, including vitamins, minerals, and enzymes.

Market Dynamics

Rising Global Population Drives the Global Market

The rising global population is driving the exponential expansion of the market for specialty food ingredients. Since the 1950s, the global population has increased significantly, primarily due to medical advancements and agricultural productivity gains. According to U.N. estimates, the world population in 2023 (at mid-year) is 8,045,311,447, a 0.8% increase from 2022, when the global population was 7,975,105,156. According to the most recent population projections, the world's population will reach 10 billion by 2057.

The need for food products that address diverse dietary demands, preferences, and health concerns rises in tandem with the growth of the world's population. Specialty food components are crucial for satisfying these changing customer needs because they provide creative and value-added solutions. As a result of the increased demand, there are now opportunities for specialty food ingredients with distinct flavors, textures, and nutritional profiles to accommodate a variety of consumer preferences.

Strategic Initiatives by Key Players Create Tremendous Opportunities

The participation of key players in product development and mergers and acquisitions will create opportunities for market expansion. For instance, in 2020, Cargill Inc. launched CTruSweet 01795, a label-friendly, specialized sweetener for the European market that reduces calories and sugar by 30% in beverages and other food applications. Similarly, in November 2021, Batory Foods acquired specialty ingredients company DMH Ingredients and DMH Ingredients subsidiary NatureStock Foods. DMH, with headquarters in Libertyville, Illinois, offers an assortment of specialty ingredients, including high-intensity and alternative sweeteners, soluble tea and coffee, dehydrated fruits and vegetables, and glycerin.

Regional Analysis

Asia-Pacific is the most significant global specialty food ingredients market shareholder and is expected to expand substantially during the forecast period. The significant rise in disposable income of consumers and the rise in population in countries such as India and China will propel the growth of the specialty food ingredients market in the Asia-Pacific region over the forecast period. For instance, India is the most populous country in the world at present, followed by China. India is home to one-sixth of the world's inhabitants. According to the World Population Dashboard of the United Nations, Bloomberg reported that India's population recently surpassed China's population of 1.42 billion. It is anticipated that by 2050, its population will reach 1.7 billion.

Moreover, other emerging nations in the region, including Indonesia, Pakistan, and Bangladesh, are among the world's most populous. The growing need for specialty food components in the region's thriving pharmaceutical, food and beverage, and personal care industries can be attributed largely to the region's large population.

Key Highlights

• The global specialty food ingredients market was valued at USD 21 billion in 2022. It is estimated to reach USD 148.97 billion by 2031, growing at a CAGR of 5.12% during the forecast period (2023–2031).
• Based on product, the global specialty food ingredients market is divided into sensory and functional ingredients. 
• Based on application, the global specialty food ingredients market is segmented into food and beverage, pharmaceutical, and personal care.
• Asia-Pacific is the most significant global specialty food ingredients market shareholder and is expected to expand substantially during the forecast period.

Competitive Players

1. Naturex
2. Givaudan
3. Koninklijke DSM N.V.
4. KF Specialty Ingredients
5. Archer Daniels Midland Company
6. Ingredion
7. Associated British Foods Plc
8. Kerry Group
9. DuPont de Nemours Inc.
10. Ashland Inc.
11. Cargill Inc.
12. Wild Flavors GmbH
13. DSM
14. Tate & Lyle
15. CHR. Hansen

Recent Developments

• May 2023- Univar Solutions Inc., a leading global solutions provider for users of specialty ingredients and chemicals, was selected as the North American distributor of ICL's Rovitaris textured plant proteins. The companies have a distribution agreement for additional ICL specialty food solutions, such as phosphate and food ingredients.
• February 2023- IFF announced that they are selling its Flavor Specialty Ingredients (FSI) business to Exponent, a leading UK private equity firm, for USD 220 million in cash.

Segmentation

1. By Product
   1. Sensory
   2. Functional
2. By Applications
   1. Food and Beverage
   2. Pharmaceutical
   3. Personal Care