Agave Nectar is a naturally derived fructose sweetener extracted from the Agave plant (Agave tequilana). Traditionally it was used by Native Americans of Mexico as a sweetener in special celebratory beverages. It has gained immense popularity in recent years as a natural sweetener and as a substitute for sugar. Agave has a neutral flavor and can be used in any food and beverage item without altering the original flavor. It is also known to keep foods to retain moisture and last longer. Furthermore, its high osmotic pressure helps inhibit bacterial growth and aids in the fermentation process.
Over the past few years, consumer preferences have seen a considerable shift towards healthy, organic, and clean label foods. This trend is anticipated to stay and see positive growth in the years to come. The growing number of diabetes cases worldwide has created an upswing for market growth.
Food and beverage is another leading industry in Europe. As per Food and Beverages Europe, total external trade accounted for USD 121 billion, of which Europe. This has been backed by resurgent investments worth about USD 3.2 billion in research and development. The food and beverage are seeing a growing interest in agave nectar derived products owing to its health benefits.
The increasing consumer consciousness about healthy foods is creating upswings for the agave nectar market growth. Furthermore, the rising demand for baked goods like dessert, cakes, pastry, etc. have boosted the demand for agave nectar. In 2019, the top exporters of Baked Goods globally were Germany and accounted for USD 3.80 billion, followed by Canada USD 2.44 billion and Italy USD 2.21 billion. Furthermore, France and Belgium-Luxembourg together accounted for total export of around USD 4.32 billion in revenue. As per the data provided by the Committee for Economic Development, the food sector accounts for about 5% of GDP.
The food sector has total sales of USD 1.4 trillion, including food consumed at home and away from home, and out of this, the food and beverage industry alone generates USD 164 billion. This highlights the immense growth potential of food and beverages that use agave nectar. The rising demand for new varieties of chocolate by the younger population is increasing the demand for seaweeds products.
The Agave Nectar is used extensively in the food and beverage industry in various forms. Right from the bakery and confectionery to other food products, agave nectar is used in a lot of formulation of the food product. Agave Nectar also finds application in chocolates as a substitute for sugar. From the last few decades, the demand for chocolate has been growing exponentially, especially in developed and developing countries for Thailand, India, China, among others. In the year 2018, the net sales of Mars Wrigley Confectionery, Mondelez International, and Ferrero Group accounted for around USD 18,000 million, USD 11,792 million, and USD 12,390 million, respectively. In line with the high sales of chocolate by just the top few companies, it is likely to offer growth potential for the global agave nectar market. Furthermore, the sugar-free or sugar substitute chocolate market is seeing a huge demand with key players investing in research to come up with different varieties of chocolate for the diabetic population globally. All these factors are likely to create a lucrative growth opportunity for the agave nectar market during the assessment period.
Asia-Pacific is one of the largest regions in terms of geography and population. The region is seeing exceptional overall growth owing to favorable government policies that are bringing in FDI in the manufacturing sector. The availability of cheap labor and dedicated Special Economic Zones(SEZ) in countries like India and China are attracting big food manufacturers from all over the globe. Increasing disposal income, rising health awareness about diabetes are nudging people to opt for the healthy alternative of sugar, which is likely to create growth shoots for market growth during the assessment period.
Agave Nectar primarily finds application in the processed food industry and the regional food industry is expected to witness fast growth in the years to come, owing to the higher consumption of baked products and chocolates and the strong presence of several emerging economies such as China, India, Malaysia, and Indonesia, amongst others. Furthermore, the rapidly growing population and urbanization, and the growing presence of supermarkets and hypermarkets are expected to catapult the processed food industry. The region is house to several economies, having a thriving food processing industry. For instance, Thailand is one of the largest food exporters in Southeast Asia, with around 1,400 larges to medium food manufacturing companies.
India is one of the leading hubs for the food industry on account of the rapidly growing population and urbanization. Between April 2000 and December 2016, around USD 46 billion were invested in the food processing industry in the country. The government of India is taking active steps to promote the food sector in the country. The Ministry of Food Processing Industries (MoFPI) has authorized 42 Mega Food Parks in the Mega Food Park Scheme and has allowed 100% FDI. Agave Nectar is used as an alternative for sugar in chocolates by the cocoa industry. Recently, Mondelez has announced to invest around USD 190 million for building the largest manufacturing plant with an annual production capacity of 250,000 metric tons of chocolate in the state of Andhra Pradesh, India. This will further boost the growth of the global agave nectar market.
Additionally, countries like Bangladesh, Cambodia, and Myanmar some of the economies that have contributed considerably to the regional GDP growth through the agriculture and allied sector. In addition to these countries, Singapore has emerged as the leader in the food processing equipment market due to its strategic geographical location, which provides convenient access to countries such as India, Indonesia, China, and other Southeast economies.
For instance, Singapore re-exports around 45% of its total exports, and some of the re-exports include beer, edible oils, soft drinks, and chocolates, amongst others. Growing awareness about switching to sugar alternatives like agave nectar will compel manufacturers to come up with a new product line with agave nectar as a sugar substitute in their products. All these factors are likely to create opportunities for Agave Nectar Market in the years to come in the Asia Pacific market. However, the recent Coronavirus pandemic has created a blip in the financial market and plummeted the demand in various sectors, and disrupted the supply chain, which is likely to have a spillover effect on the agave nectar market.