The global baking ingredients market size was valued at USD 17.3 billion in 2020 and is expected to grow at a CAGR of 5.9% during the forecast period. Baking ingredients include enzymes, starch, leavening agents, fibers, extract and flavorings, fats, and emulsifiers. Baking ingredients enable good quality, soft, and fresh goods such as bread, cookies, and pastries. The baking process is influenced by humidity, temperature, and the amount of each baking ingredient used.
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The use of correct elements results in consistent products by enhancing machinability, volume, and crumb structure. The foodservice sector uses baking ingredients and leavening agents to offer improved dough machinability, increased dough strength, superior loaf volume, reduced staling rate, greater shelf-life of products, and decreased processing time.
Rising consumption of fast food such as burgers, pizza, and pastries, rising adoption of western lifestyle & eating habits, and hectic consumer lifestyle has increased the demand for baked goods, especially in emerging economies. Growing disposable income, rising awareness regarding nutritional intake, and greater demand for enriched food products with health benefits are fueling the growth of the ingredients market.
Consumers with food allergies and special dietary needs are turning towards baking their own food products. Increasing health concerns coupled with food safety, growing health and fitness consciousness, and changing food habits have fueled the growth of the global ingredients market. Market players are expected to launch healthier options with enhanced nutritional content post-COVID-19 outbreak to cater to growing consumer demand for nutritious, low calorie, organic, and gluten-free ingredients.
E-commerce platforms have gained popularity for the sale of the ingredients, especially during the pandemic. Online platforms offer a plethora of options to consumers on a single portal, offering convenience and saving time & effort. Rigorous online marketing supplemented with attractive offers and discounts offered by companies has increased the popularity of e-commerce in recent years.
The online distribution channel is well established in the developed markets such as Europe and North America due to higher internet penetration and greater adoption of mobile devices. However, significant growth in the sale of the ingredients through online channels has also been registered in the developing economies, encouraging many new market entrants to launch their own e-commerce sites.
Additionally, increased food safety concerns and disruption in the supply chain during the pandemic have encouraged consumers to bake their own bread and cookies. Consumers are also turning to bake as it is associated with emotion management, stress reduction, and enhanced social bonding.
The sale of convenience and ready-to-cook food products has increased considerably during the pandemic, primarily in developing markets such as China and India. However, the closure of restaurants and bakeries due to lockdown, disruptions in the supply chain, halting of manufacturing activities, and limited availability of raw material and labor has severely affected the growth of the market. High demand for baking ingredients coupled with low supply has resulted in increased prices during the pandemic.
The market is primarily segmented on the basis of type, application, distribution channel, and region.
By Distribution Channel
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On the basis of type, the ingredients market is segmented into emulsifiers, preservatives, enzymes, colors and flavors, baking powders & mixes, leavening agents, fats and shortenings, and others. The baking powder & mixes segment accounted for a significant share in the global baking ingredients market in 2020.
Baking powder is a leavening agent containing sodium bicarbonate and acid. It is responsible for the product to rise. Single-acting baking powder causes a reaction when mixed with moist ingredients. Double-acting baking powder contains two acidic components. Using this baking powder, the primary reaction takes place when mixed with moist ingredients, whereas the secondary reaction takes place upon baking the product.
On the basis of application, the ingredients market is segmented into biscuits and cookies, bread, cakes and pastries, and others. In 2020, the bread segment accounted for the highest industry share. The use of baking ingredients in the production of bread enables easy dough handling, gas formation, and retention.
This segment is influenced by the rising population, growing consumption of fast food such as pizzas and burgers, and increasing food safety concerns. There has been an increasing shift towards organic and whole wheat-based bread with oats, bran, and seeds, which contributes to the growing demand for baking ingredients from this segment.
The distribution channel segment has been divided into supermarkets and hypermarkets, specialty stores, convenience stores, online platforms, and others. The supermarkets and hypermarkets bridge the gap between manufacturers and customers by offering a wide range of product variety at the same place.
These stores are mainly rooted in highly populated cities and urban cities. Consumers are increasingly shopping for baking ingredients from offline stores owing to heavy discounts, a large variety of products under a single roof, and promotional offers to attract consumers.
Europe accounts for a significant share of the ingredients industry. The high disposable income of consumers and rise in consumption of convenience food drive the growth in this region There has been an increased demand for premium low cholesterol baked goods, desserts, and pastries in the region, increasing awareness regarding healthy eating habits.
Industry players of ingredients in the region are introducing low-calorie, whole-wheat bread, high-fiber, and other baked products to cater to the rising health issues and increasing cases of obesity-related diseases. Growth in a number of fast-food restaurants, and small bakery businesses further boost the sale of baking ingredients in the region.
The leading players in the baking ingredients market include AAK AB, Associated British Foods plc, British Bakels Ltd, Cargill, Carif. Corbion N.V., Dawn Food Products, Inc., DuPont, IFFCO, Ingredion Incorporated, IREKS GmbH, Kerry Group plc, Koninklijke DSM N.V., Lallemand Inc, Lesaffre, Millbaker, OYC Americas, Inc., Puratos Group, Rich Products Corporation, Sensient Technologies, SwissBake, TasteTech Ltd, Tate & Lyle PLC, and The Archer-Daniels-Midland Company (ADM).
These players are expanding their presence across various geographies and entering new markets in developing regions to expand their customer base and strengthen presence in the industry. The companies are also introducing new innovative products in the industry to cater to the growing consumer demands.
Market size value in 2020
USD 17.3 billion
Revenue forecast in 2028
USD 24.7 billion
5.9% from 2021 - 2028
2016 - 2019
2021 - 2028
Revenue in USD million and CAGR from 2021 to 2028
By Type, By Application, By Distribution Channel, By Region
North America, Europe, Asia Pacific, Latin America, Middle East & Africa
AAK AB, Associated British Foods plc, British Bakels Ltd, Cargill, Carif. Corbion N.V., Dawn Food Products, Inc., DuPont, IFFCO, Ingredion Incorporated, IREKS GmbH, Kerry Group plc, Koninklijke DSM N.V., Lallemand Inc, Lesaffre, Millbaker, OYC Americas, Inc., Puratos Group, Rich Products Corporation, Sensient Technologies, SwissBake, TasteTech Ltd, Tate & Lyle PLC, The Archer-Daniels-Midland Company (ADM)