The global bioactive ingredients market size was valued at USD 31.24 billion in 2017 and is estimated to grow at a CAGR of 5.5% from 2018 to 2026. Growing demand for fiber, omega 3 PUFA, probiotics, and plant extracts used in functional food & beverages, dietary supplements, and personal care products is projected to boost market growth over the forecast period. Other uses of bioactive ingredients in animal nutrition and clinical nutrition are further anticipated to fuel the demand for this market over the coming years.
Companies producing raw material compounds, such as carotenoids and numerous bacteria, usually produce the ingredients after processing. The industry is characterized by the high level of integration between raw material providers and manufacturers. ADM, Cargill and DuPont are involved in such integration.
Frequent mergers and acquisitions are witnessed in the industry. In October, 2014, Ingredion Incorporated acquired Penford Corporation which solely specializes in producing specialty ingredients for food and non-food application areas. This strategy enhanced the product portfolio of specialty and industrial products, which in turn acted as an added advantage for a wide range of applications usage evolved by various end-use industries for the company.
Suppliers play an important role in integrating the value chain, helping to integrate the businesses operations in a more efficient and cost-effective manner and helps in better management of raw material procurement.
Bioactive ingredients are used across various end-use applications such as in functional food & beverages, dietary supplements and personal care. Moreover, with the additional advancement in technology, these ingredient usages is expected to increase from its current uses to many other new areas of the human health. Some of the major players of the markets are Ajinomoto, ADM, DuPont, Cargill, BASF and others.
Market Estimates and Forecast
Changing lifestyle and rising disposable income has resulted in an increase in demand for functional food and nutraceuticals supplements. Nutraceutical supplements provide extra nutrition value to the diet, which is not fulfilled by regular meals. Regulations have been imposed for evaluation of health claims. Government regulations are being also been taken to label food based on the Trans fatty acid concentration.
Recent advancements in R&D are bound to prove beneficial for the overall industry growth. Scientists have been successful in developing methods that allow them to grow ingredients in laboratories that are similar to the natural ones. The focus on sustainability has given results in the form of advances in developing methods to produce bioactive ingredients in large amount without damaging the overall quality.
Effective encapsulation methods are in high demand for preservation of these compounds until it is reached to the physiological action site. Bioactive food categories have been gaining significant interest owing to its potential health benefit propositions. They are useful for improving endothelial function, increasing the gut microbial diversity, reducing bone loss and also for overall improvement of cognitive body function.
The EPA and European Commission have designed industry favorable regulations to augment production of ingredients derived naturally and with an effort concerning for reduction of greenhouse gas (GHG) emissions. Owing to this, F&B manufacturers have been pursuing their efforts to fortify organically prepared additives to meet the carbon reduction benefits and norms and ensure sustainable assess ability to raw material in the near future, by reducing dependency on the artificially developed chemicals.
There are several issues associated with bioactive ingredients when added to food. Many food ingredients become unstable once they are extracted from its natural source. They require protection throughout their shelf life without compromising the food quality. Such a factor is expected to critically influence the overall market over the forecast period.
Food & beverage manufacturers are deploying fortification of nutritional additives such as omega-3, fibers, vitamins, minerals and others in their product offerings. The major factor for incorporating the aforementioned additives in food and beverage products is to enhance nutritional content.
Dietary supplements segment is anticipated to have high penetration over the forecast period owing to the increasing health concerns among consumers. This segment is expected to have a high growth rate in the future. Rising disposable income and rise in the standard of living of the people are projected to positively drive the growth of this segment.
Personal care segment has the third largest market share with a moderate growth rate. Rising health consciousness is a key reason for the growth of this segment. This segment is anticipated to have a slow growth due to high prices for manufacturing of personal care products.
Asia Pacific is expected to drive demand for bioactive ingredients in food on account of increasing spending power, globalization, and changing lifestyles in the region. Moreover, growing awareness of the benefits of bioactive ingredients in various countries including China, India, Indonesia, Malaysia, and Japan is anticipated to spur the growth of these ingredients in food & beverage industry over the next eight years. Market presence of functional foods producers along with rising expenditure R&D operations to develop novel additives in the Europe region is anticipated to promote bioactive ingredients demand in the near future.
Companies are focusing more on development of innovative products to acquire market share. Customized product offerings to treat specific diseases such as skin diseases are being developed by industry participants. Major industry participants include BASF, DuPont, Cargill Inc., Archer Daniels Misland Company, Ingredion Incorporated, Ajinomoto Co. Inc. and Owen Biosciences Inc.