Clean Label Foods Market

Market Overview

Market Dynamics

Growing Health Consciousness among Consumers Drives the Market Growth

The increasing concern regarding health and fitness among consumers is the primary factor expected to drive the market. Consumers have an inclination toward natural and organic products or products that do not include any chemical or synthetic additives. Clean label foods include natural, organic, and non-GMO food products. According to Laborers Health & Safety Fund of North America (LHSFNA), the additives added in the food products such as unhealthy levels of added sugar, fat and sodium to make them tasty, can have serious health issues such as heart disease, obesity, high blood pressure, and diabetes. Hence, due to the increasing health consciousness mostly in the western world, including European countries and the Americas, the consumers are opting for clean labels products with fewer or no additives or free from preservatives.

According to a survey commissioned by a leading food ingredients manufacturing company “Kerry Group PLC” in 2019, 76% of foodservice consumer in the U.S. has said that clean label foods are healthier than traditional foods. Also, 44% of the U.S. population says clean label foods are essential to them. Clean label depends on the consumer sentiments; on clean label, they usually look for products free from chemical additives and free from genetically modified ingredients and others.

Segmental Analysis

The baked product segment among product type is expected to witness lucrative growth during the upcoming years. The demand for baked products is increasing mostly in the Asia Pacific and European region owing to the changing lifestyle of the consumers. Owing to the busier lifestyle of the consumers, the demand for bread and other baked products is increasing in the Asia Pacific, people avoid to cook foods at home to save time from their hectic busier schedule, they mostly rely on the baked products.

In addition, Europe is among the largest consumer of bread and bakery products across the globe. In 2017, organic fresh bakery products revenue in France was around USD 654 million. Also, the demand for prepared foods and ready meals is increasing at a fast pace across the globe due to the fast preparation of food and time-saving. Consumers mostly in North America and Europe are inclined towards ready meals and prepared foods due to their busier lifestyle. According to the report published by Statista, the global revenue generated from ready meals was around USD 67 billion, in which most revenue is generated in the U.S.

Regional Analysis

The food sector in the past few years has witnessed an inclination toward clean label foods. In developed regions such as Europe and North America, the consumers are shifting from traditional foods to clean-label food, owing to the presence of a large number of health-conscious demographic. In addition, owing to high per capita income, people are willing to pay extra for clean label food products that do not have complicated ingredients and are free from chemicals and are non-GMO. Also, Europe is the world’s largest food market. In Europe, there are 294,000 food manufacturers present as of 2018. The turnover from the food sector in Europe was around USD 1,268 billion in 2018. Besides, most health-conscious people, including the vegan population is also present in Europe. These factors prompted manufacturers to launch healthy and clean label products in the region. In 2008, the number of new products launched with a clean label was only 500 in the Netherlands; this has increased drastically in the last few years and reached 2000 new clean label products in a single year. Various manufacturers are focusing on these markets and are launching clean label products in these markets to boost their sales. Premium brands having little or no healthy food quotient is at risk of getting bypassed.

New entrants, as well as existing players, are focusing on the Asia-Pacific market to gain high market share as North America and Europe regions are particularly advanced with respect to clean labels and have a strong competitor presence and awareness. Thus, manufacturers are trying to enter developing regions and differentiating their products from the competition by using clean label positioning. To increase their sales, manufacturers are trying to tap growth opportunities, particularly in countries such as China and India. Due to social media, the trends have become the same for all the nations; consumers are demanding natural and organic products in the developing regions as well. The demand for clean label foods in India is also influenced by the growth of organic, non-GMO, and natural food movements that are taking place in other parts of the word.

Recent Developments

Various manufacturers are developing clean label food products and ingredients as per consumer demand. Manufacturers are taking into account consumer behavior and purchasing patterns of food products.

• In March 2020, a leading food products manufacturing company Ingredion, Inc., launched Evanesse CB6194, a clean label emulsifier in the North American market
• In September 2019, Limagrain Ingredients launched a range of clean label protein premixes for bread products

Clean Label Foods Market Segmentation

The global clean label foods market is broadly segmented into 4 major segments i.e., by product type, by ingredients, by distribution channel, and by region.

By Product Type

• Baked Products
• Prepared Foods/Ready Meals & Processed Foods
• Beverages
• Dairy & Frozen Desserts
• Cereals & Snacks
• Others

By Ingredient

• Natural Flavours
• Natural Colours
• Starch and Sweeteners
• Flours, Malt
• Fruit & Vegetable Ingredients
• Natural Preservatives
• Oils & Shortenings
• Emulsifiers
• Cereal Ingredients
  • Others

By Distribution Channel

• Store-based Retail
  • Hypermarket/Supermarket
  • Convenience Stores
  • Specialty Stores
  • Others
• Online Retail

By Region

North America

• U.S.
• Canada
• Mexico

Europe

• Germany
• France
• U.K.
• Italy
• Spain
• Netherlands
• Russia
• The Rest of Europe

Asia-Pacific

• China
• Japan
• India
• South Korea
• Australia
• Indonesia
• Malaysia
• Singapore
• Vietnam
• The Rest of Europe

Central and South America, and the Caribbean

• Brazil
• Argentina
• Colombia
• Rest of Central, South America, and the Caribbean

The Middle East

• Saudi Arabia
• UAE
• Oman
• Bahrain
• The Rest of the Middle East

Africa

• Nigeria
• South Africa
• Ghana
• Tanzania
• The Rest of Africa