Functional Foods Market 2023 – 2030 By Ingredient (Carotenoids, Prebiotics & Probiotics, Fatty Acids, Dietary Fibers),Product,Application - Partner & Customer Ecosystem (Product Services, Proposition & Key Features) Competitive Index & Regional Footprints by MarketDigits
Industry : FMCG | Pages : 176 Pages | Published On : Jul 2023
The global market for functional foods was valued at USD 280.7 billion in 2021 and is projected to grow at a CAGR of 8.5% from 2023 to 2030. The market is driven by increasing demand for nutritional and fortifying food additives, driven by the growing awareness of their health benefits and the need for convenient and healthy food options. The COVID-19 pandemic had a moderate impact on the market, with increased demand for functional foods that boost immunity, but disruptions in the supply chain affected overall production. However, companies are actively promoting functional foods through marketing efforts and expanding their online distribution, which is expected to positively impact the market in the coming years.
In the United States, the market is driven by the rising demand for nutrient-rich food due to busy lifestyles and increased consumer awareness of the health benefits. The aging population's concerns about maintaining good health, rising medical costs, and the growing understanding of the link between well-being and healthy eating habits also contribute to the demand for functional foods in the country. The global market is experiencing growth as consumers worldwide become more health-conscious and seek functional foods to support their well-being. Government agencies, non-governmental organizations, and companies are actively promoting nutritional benefits through awareness campaigns, further boosting the market.
Manufacturers in the food and beverages industry are fortifying products with nutritional additives such as fibers, omega-3 fatty acids, vitamins, and minerals to enhance their nutritional content. Functional dairy products like milk, yogurt, cheese, and functional ice cream are gaining popularity as consumers seek convenient ways to incorporate functional foods into their diets. Functional ingredients like omega-3 fatty acids and probiotics, commonly found in fish oils and yogurt, are known for their health benefits, including cardiovascular disease prevention and improved gut health. During the COVID-19 pandemic, there was a surge in demand for products promising immunity-boosting properties, which is expected to drive the market in the future.
Many companies in the functional food market are introducing new products to cater to consumer needs and improve their market share. The launch of new products helps drive sales and capture a larger portion of the functional food market. For example, in March 2021, the Coca-Cola Company's Vitaminwater introduced two new fortified soft drink variants, 'Look' with a blueberry hibiscus flavor, and 'Gutsy' with a watermelon and peach flavor.
Carotenoids are expected to grow at a CAGR of 7.2% from 2023 to 2030. They are available in various forms, such as lutein, beta-carotene, lycopene, astaxanthin, zeaxanthin, canthaxanthin, and annatto. Carotenoids are valued for their role in treating eye disorders, cancer, and diabetes, and increased research and development efforts in natural carotenoid production offer new market opportunities.
Dietary fiber consumption is associated with multiple benefits, including bowel health, cholesterol reduction, and blood sugar control. As the functional food market expands, dietary fiber is expected to play a significant role. Fiber-rich foods, primarily found in fruits, vegetables, legumes, and whole grains, not only prevent or alleviate constipation but also provide additional health benefits such as weight management, reduced risk of diabetes, and cardiovascular disease prevention.
In 2021, the dairy products segment held the largest market share of over 38% in terms of revenue, followed by the bakery and cereals segment. Other significant product segments include meat, eggs, soy products, fish, and fats & oils. Yogurt, milk drinks, and spreads are effective delivery systems for functional foods, containing beneficial compounds that can be incorporated into cooking. The dairy products segment is expected to grow at a CAGR of approximately 7.9% during the forecast period.
The bakery and cereals segment accounted for a 26% market share in 2021. New product developments in this segment, especially cereal bars and functional snacks like protein bars, nutrition bars, and energy bars, are expected to drive market growth in the coming years. Fortified cereals are also projected to grow rapidly, with companies like Kellogg's introducing new product lines fortified with essential vitamins and minerals.
The demand for meat, poultry, and egg-based functional foods is expected to increase due to population growth and consumer preferences for high-quality meat. This segment is anticipated to expand at a CAGR of 9.4% during the forecast period.
Soy products are projected to grow at a CAGR of 9.9% from 2023 to 2030. The rising demand for gluten-free flours with high protein, iron, vitamins, and calcium content is driving the growth of soy-based functional foods. Additionally, there is an increasing preference for fats and oils in the food and beverage industry due to the demand for wholesome foods with clean labels.
The global functional foods market caters to various applications, including sports nutrition, clinical nutrition, weight management, cardio health, immunity, and digestive health. The cardio health segment is expected to grow at a CAGR of 8.6% from 2023 to 2030, driven by the rising demand for functional foods to address cardiovascular diseases and related conditions.
Sports enthusiasts seeking vitamins and proteins drive the demand for functional foods in the sports nutrition segment. These products help in energy recovery, increasing endurance, and reducing physical strain. The market is further boosted by health goals such as muscle and bone strength, weight loss, and joint health. The sports nutrition segment is projected to grow at a CAGR of 10.0% between 2023 and 2030.
The immunity application segment was valued at USD 57.6 billion in 2021, with functional foods playing a crucial role in boosting the immune system. Functional foods containing antioxidant vitamins, nucleotides, synbiotics, fatty acids, and L-arginine support immune responses and gained popularity during the COVID-19 pandemic. These products also have positive effects on cardiovascular health. The immunity segment is expected to witness market growth during the forecast period.
In 2021, North America accounted for more than 24.7% of the global functional foods market in terms of revenue. The major application segments in North America include immunity, weight management, digestive health, and cardio health. The increasing interest in fitness among consumers in the United States, Mexico, and Canada is expected to drive the demand for functional foods and beverages. Additionally, millennials' preference for protein bars, shakes, and cookies as healthy snacks is anticipated to boost the demand for functional foods in North America.
The Asia Pacific region has one of the largest markets for functional food products, with a market share of 35.8% in 2021 in terms of revenue. The region benefits from a growing population and rising disposable income. The increasing consumption of processed foods and the growing awareness of health and fitness in developing economies are major drivers of the regional market. Consumer awareness and concerns about food safety have also been on the rise, especially after the impact of the COVID-19 pandemic, which has influenced consumer behavior and contributed to market growth.
Key Companies & Market Share Insights
The functional foods market is highly competitive, with both major public and private companies focusing on research and development and product innovations. Public companies have taken proactive measures to gain a competitive edge in the market, and private market participants are expected to follow suit in the near future. For example, in October 2020, Amway Corp. invested USD 15 million in its manufacturing facility to exclusively produce sugar-free XS Energy Drinks. The market has witnessed key developments in terms of product innovation and portfolio expansion. Arla Foods Ingredients, for instance, launched a new protein-enriched juice drink concept using Lacprodan ISO for beverage fortification in March 2021. Some prominent players in the global functional food market include The Coca-Cola Company, GFR Pharma, Arla Foods amba, Amway Corp., Herbalife International of America, Inc., Cargill, Incorporated, General Mills Inc, BASF SE, Standard Functional Foods Group Inc., KFSU, and Nutri-Nation.
Global Functional Foods Market Segmentation
This report forecasts revenue growth at the global, regional, and country levels and provides an analysis of the latest industry trends and opportunities in each of the sub-segments from 2017 to 2030. For the purpose of this study, Grand View Research has segmented the global functional foods market report on the basis of ingredient, product, application, and region:
Ingredient Outlook (Revenue, USD Billion, 2017 - 2030)
• Dietary Fibers
• Fatty Acids
• Prebiotics & Probiotics
Product Outlook (Revenue, USD Billion, 2017 - 2030)
• Bakery & Cereals
• Dairy Products
• Meat, Fish & Eggs
• Soy Products
• Fats & Oils
Application Outlook (Revenue, USD Billion, 2017 - 2030)
• Sports Nutrition
• Weight Management
• Digestive Health
• Clinical Nutrition
• Cardio Health
Regional Outlook (Revenue, USD Billion, 2017 - 2030)
• North America
• Asia Pacific
o South Korea
• Central & South America
• Middle East & Africa
o South Africa
o Saudi Arabia
Table and Figures
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