Nutraceutical Ingredients Market

Market Overview

The global nutraceutical ingredients market size was valued at USD 185.9 billion in 2022 and is projected to reach USD 365.4 billion by 2031, registering a CAGR of 7.8% during the forecast period (2023-2031). The growing elderly and obese population worldwide drives the growth of the nutraceutical ingredient market.

Nutraceutical ingredients are bioactive chemicals or molecules produced from natural food sources that enhance nutritional value and provide health benefits in addition to essential nutrition. These ingredients are frequently used in food, beverages, or dietary supplements to promote health, prevent disease, and preserve overall well-being. Nutraceuticals offer a comprehensive approach to health and wellness by bridging the gap between traditional diets and medications.

The popularity of nutraceutical ingredients is increasing due to changing lifestyles, the growing veganism trend, innovations in nutraceutical products, growing venture investments in nutraceutical companies, the increasing incidence of chronic and infectious diseases, and the growing use of nutraceutical ingredients in food and beverage products, all of which positively impact demand for nutraceutical ingredients. The Nutraceutical Ingredients Market share is driven by rising demand for these ingredients in fortified foods and food and beverage products, an increase in noncommunicable chronic diseases, and the increasing usage of nutraceutical ingredients in animal nutrition. However, the high cost of nutraceutical goods and consumer misconceptions are projected to limit the market's growth.

Market Dynamics

Nutraceutical Ingredients Market Drivers

Aging Population and Age-Related Health Concerns

An aging population with a rising share of older people characterizes the global demographic landscape. As people age, health concerns related to aging, such as joint problems, cognitive loss, and cardiovascular disorders, naturally develop. With an aging population, there is a greater emphasis on maintaining joint health, particularly when individuals may develop osteoarthritis. Nutraceutical ingredients like glucosamine, chondroitin, and collagen are popular because they can improve joint function and lower discomfort. In 2022, 771 million people aged 65 and up comprised about 10% of the global population. This population group is predicted to grow, reaching 16% by 2050 and 24% by 2100. As the senior population grows, cognitive health becomes increasingly important. Nutraceutical ingredients such as omega-3 fatty acids (DHA and EPA), phosphatidylserine, and antioxidants improve brain health and mental performance.

Furthermore, age-related cardiovascular disorders, such as hypertension and raised cholesterol levels, have fueled interest in nutraceutical ingredients that enhance heart health. Elements linked to cardiovascular health include omega-3 fatty acids, plant sterols, and coenzyme Q10. For example, the World Health Organization (WHO) estimates that the share of the world's population over 60 will nearly double from 12% to 22% between 2015 and 2050. This demographic transition emphasizes the importance of addressing age-related health concerns. Nutraceutical products with formulas tailored to the senior population have gained popularity. These medicines frequently incorporate specialized combinations of vitamins, minerals, and bioactive components to address the unique health concerns associated with aging. As a result, the expanding aging population impacts the nutraceutical ingredient market trend.

As a result, the aging population trend is likely to continue, resulting in continued growth in demand for nutraceutical ingredients. Ongoing research into age-related health concerns and the development of novel formulations will likely affect the market's reaction to the needs of an aging demographic.

Nutraceutical Ingredients Market Restraints

Price Sensitivity

Consumer price sensitivity may limit the use of premium or specialty nutraceutical ingredients. Cost concerns can impact purchase decisions, especially in marketplaces where affordability is significant. According to a study published in the "Journal of the American College of Nutrition," price sensitivity is a prominent factor influencing customers' dietary supplement purchasing preferences. The study discovered that customers frequently evaluate the cost of supplements when making purchasing decisions and that price sensitivity can affect supplement regimen adherence. Omega-3 fatty acids, which are found in fish oil and algal oil supplements, have been linked to improved cardiovascular and cognitive health.

However, omega-3 pills can be pretty pricey compared to other nutritional supplements. Some customers may value price over the perceived benefits of high-quality ingredients. Consumers are sensitive to price hikes for nutraceuticals, according to a 2021 survey. For example, 17% of respondents said they would stop buying protein powder if the price went up, 23% said they would stop buying probiotics, and 28% said they would stop buying omega-3 fish oil supplements if the price went up. As a result, price sensitivity might influence customer behavior, resulting in trade-offs between the perceived value and cost of nutraceutical ingredients. Some consumers may choose less expensive alternatives or products with a more straightforward component composition if premium ingredients are too expensive.

Nutraceutical Ingredients Market Opportunity

Personalized Nutrition and Customized Products

Personalized nutrition is the practice of adapting dietary recommendations and supplement regimens to individual needs based on criteria such as age, gender, health goals, and genetic makeup. This approach has gained appeal as people demand more customized and focused solutions for their health and wellness. Companies offering DNA testing services inform people about their genetic predispositions to nutrition, metabolism, and certain health disorders. Nutraceutical makers can use this information to create individualized formulas that meet specific nutritional needs and deficits. For example, if a person has a hereditary tendency to have vitamin D insufficiency, a tailored supplement may be developed to address this specific need. The COVID-19 pandemic, according to Diana Food, altered consumers' demand for individualized nutrition. Around 70% of the UK public wants to understand the impact of lifestyle on long-term health; 40% of Germans prefer individualized supplements; and 72% of Chinese are willing to share health data to receive personalized services.

Furthermore, consumers are becoming more proactive in their approach to healthcare, seeking preventive remedies for potential health issues before they develop. This trend is aligned with personalized nutrition, which allows individuals to take a proactive part in controlling their health through tailored food choices and nutraceutical supplementation. Thus, as technology progresses and our understanding of genetics and individual health needs deepens, the personalized nutrition and nutraceutical ingredients industry will likely rise further. Companies that embrace individualized product development and marketing methods will survive in this changing environment.

Regional Analysis

North America Dominates the Global Market

The global nutraceutical ingredient market analysis is conducted in North America, Europe, Asia-Pacific, the Middle East and Africa, and Latin America.

North America is the most significant global nutraceutical ingredient market shareholder and is estimated to grow at a CAGR of 7.7% over the forecast period. The rise of the nutraceutical ingredient market in this region can be attributed to an increase in the use of dietary supplements as people become more aware of the health benefits of taking them because they contain nutrients, notably minerals and vitamins. According to the United States Pharmacopeia Convection, 80% of American adults utilize nutritional supplements. With rising demand for anti-aging nutraceutical products, North America has emerged as a market leader.

In addition, North America continues its supremacy throughout the projection period due to the high frequency of chronic and non-chronic diseases. Large corporations perform more extraordinary market advancements and more excellent R&D initiatives. Consumer demand for functional meals and dietary supplements will drive regional market growth. Essential food and beverage manufacturers raised their spending on research and development activities to advance nutraceutical ingredients. As a result, it is likely to boost market growth throughout the forecast period.

Asia-Pacific is anticipated to exhibit a CAGR of 8.0% over the forecast period. As a result of busy lifestyles, convenience food consumption has increased, and the region's economies have grown more swiftly. This has resulted in an upsurge in the demand for enriched nutritional food and beverage items. Foods or nutraceuticals with gastrointestinal tract improvement-related health claims are the most common in Japan. Triglyceride reduction is the second-most common claim, behind cholesterol reduction. According to the World Bank, Japan's healthcare expenditure accounted for 10.74% of GDP in 2020, placing it among the top countries in health expenditure. These ingredients have achieved considerable success in the Japanese market due to increased healthcare spending.

Furthermore, the functional beverage segment in the nutraceutical ingredient market is expected to grow steadily during the forecast period due to an increase in the adoption of health and fitness drink commodities among consumers, particularly in China, Japan, India, and Malaysia. Oceanian countries like Australia and New Zealand have a low population growth rate. Athletes and sportspeople consume many nutraceutical products, and the sports and energy segment in Asia-Pacific is expected to be the fastest-growing segment due to increased awareness of organic benefits and the purchase of supplements containing nutraceutical ingredients. 

Europe holds a significant market share. According to nutraceutical ingredient market insights, Europe has a robust and well-established nutraceutical market that strongly emphasizes health and wellness. The market has a diversified selection of ingredients that cater to a wide range of consumer preferences and health demands. The use of nutraceutical ingredients is strictly regulated in the European Union (EU). The European Food Safety Authority (EFSA) is critical in reviewing health claims and assuring the safety of food and supplement ingredients.

Segmental Analysis

The global nutraceutical ingredients market is segmented based on type, form, application, and region.

By Type, the market is further segmented into probiotics, vitamins, minerals, proteins, and dietary fibers.

Probiotics account for the largest share of the market.

Probiotics

Probiotics are live microorganisms, primarily beneficial bacteria, that provide health advantages to the host when taken in sufficient quantities. They are well-known for improving intestinal health and the immune system. According to product type, the probiotics segment dominated the worldwide medical nutraceutical ingredients market in 2022 and is expected to maintain its dominance throughout the forecast period. When consumed appropriately, probiotics have a positive effect on the body, such as improved gut health and decreased intestinal inflammation. Probiotics are vital for preventative healthcare since they increase immune function and prevent illness development. As a result, rising awareness of preventive healthcare is expected to drive market growth.

Vitamins

Vitamins are chemical molecules that are necessary for several physiological activities. They are only needed at trace levels but are critical for overall health and well-being. Vitamins are commonly employed to satisfy specific nutritional demands in dietary supplements, fortified meals, and functional beverages.

Based on form, the market is sub-segmented into dry and liquid.

The dry form holds a significant market share.

Dry

Nutraceutical ingredients in dry form are powdered or solid. Spray drying, freeze drying, and other dehydration procedures are used to attain this shape. Dry versions are more stable, have a longer shelf life, and are easier to handle and transport. Manufacturers prefer dry nutraceutical components due to their improved stability, ease of handling and storage, and versatility in various products. One of the key factors driving demand for dry ingredients is manufacturers' concern regarding storage handling because liquids are more volatile than dry ingredients.

Liquid

Liquid nutraceutical ingredients are liquid or fluid. These could be extracts, concentrates, or solutions. Liquid versions have the benefit of rapid absorption and bioavailability. The liquid segment of the global nutraceutical ingredients market is the fastest-expanding. Due to its use in yogurt, the most widely eaten source of probiotics, a liquid form of a nutrient, the demand for liquid nutraceutical ingredients has risen compared to dry nutraceutical ingredients. Kefir water, probiotic juices, and yogurt drinks are a few other items with liquid ingredients that are all essential daily supplements.

The market can be bifurcated by application into dietary supplements, functional foods and beverages, and animal nutrition.

Functional food and beverage generates the most revenue.

Functional Food and Beverage

Functional foods and beverages are goods that provide additional health advantages in addition to basic nutrition. These products are made with unique nutraceutical ingredients to address specific health issues or improve overall well-being. The functional food and beverage category is growing the fastest in the worldwide nutraceutical ingredient market. Awareness, belief in their efficacy, and safety influence the nutraceutical ingredient market. Nutraceutical additives are widely employed in various functional food and beverage applications, including dairy products, non-dairy beverages, cereals, and baby formula.

Dietary Supplements

Dietary supplements complement the diet by supplying vital vitamins, minerals, amino acids, fatty acids, and other valuable substances. These supplements are available in various formats, including capsules, tablets, powders, and liquids. Vitamins, minerals, plant extracts, amino acids, probiotics, and other nutraceutical ingredients are frequently included in dietary supplements.

Recent Developments

• November 2023: The Kraft Heinz Company introduced the first-ever plant-based Kraft Mac and Cheese.
• November 2023: Amway's XS Energy and Sports Nutrition Brand will support 52 SUPER SERIES in the United States in 2024.
• July 2023: Danone introduced a new science-based probiotic supplement to help breastfeeding mothers.