The functional food ingredients market, valued at approximately USD 98.9 billion in 2021, is anticipated to grow at a compound annual growth rate (CAGR) of 6.8%. This growth trajectory is expected to lead the market to reach a valuation of USD 137.1 billion by 2026. The market's expansion is attributed to the increasing preference for convenient and nutritional food options, along with a rising demand for fortified food and beverage products. However, certain factors are impeding its growth. These challenges encompass the necessity to adhere to international quality standards and regulations, as well as a lack of awareness about functional ingredients, such as prebiotics and probiotics, in developing nations.
The global demand for fortified food is undergoing robust expansion. Key components of fortified food include functional food ingredients like vitamins, minerals, antioxidants, hydrocolloids, prebiotics, amino acids, plant extracts, and carotenoids. The proliferation of health-conscious populations in emerging markets is fueling the demand for food fortification. The discrepancies in nutritional consumption across regions significantly contribute to disparities in population health. Multiple factors, including an uptick in chronic diseases and micronutrient deficiencies, the growth of middle-class segments in emerging economies, the implementation of government fortification initiatives, the aging of populations in regions like Europe, and heightened interest in health and wellness due to COVID-19, are expected to drive the sales of fortified foods and consequently, enhance the demand for functional food ingredients.
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In North America, consumers are increasingly health-conscious, diligently scrutinizing food product labels. This heightened awareness regarding consumed ingredients is fostering market growth for functional food ingredients. The region holds substantial potential for functional food ingredient consumption, playing a pivotal role in the global market. This prominence stems from the prevalence of chronic diseases due to fast-paced lifestyles, as well as growing consumer awareness about the health advantages of functional foods. Furthermore, the region exhibits a high prevalence of obesity. According to CRN's 2019 data, a significant portion of US adults consume dietary supplements, with popular choices being multivitamins, vitamin D, vitamin C, protein, calcium, B complex vitamins, omega-3s, green tea, magnesium, probiotics, iron, turmeric, and vitamin E. The functional food ingredients sector is concentrating on intensified research initiatives to introduce new ingredients that cater to the diverse demands of potential customers within the region.
Prominent players in the North American functional food ingredients industry include Cargill, Incorporated (US), Archer Daniels Midland Company (US), and DuPont (US). These industry leaders operate research and development centers, where they innovate a wide spectrum of functional food ingredients for the food and beverage sector. Cargill invested USD 146 million in expanding its protein production facility in Nashville, Tennessee, US. Additionally, in 2017, ADM introduced Onavita DHA algal oil, a new DHA source derived from reliable US algae supplies.