The global functional foods and beverages market is expected to reach USD 793.60 billion by 2032, with a compound annual growth rate (CAGR) of 10.23% over the forecast period. According to Fortune Business Insights™, this surge will be largely fueled by increasing global malnutrition rates. These insights are highlighted in their report titled “Functional Food and Beverages Market Size, Share & Industry Analysis, By Type (Cereals & Grains, Fats & Oils, Dairy Products, Bakery Products, and Other Functional/Fortified Foods), Distribution Channel (Supermarkets/Hypermarkets, Convenience Stores, Online Retail, and Others), and Regional Forecasts, 2024 – 2032.”
The World Health Organization (WHO) estimates that around 462 million people globally are underweight, with approximately 52 million children under five affected by wasting. Undernutrition is a factor in nearly 45% of deaths in this age group. In response, governments worldwide are taking action to combat malnutrition. For example, in 2019, the UK introduced mandatory folic acid fortification in flour to reduce congenital disabilities, while in July 2019, India began distributing fortified rice with folic acid, Vitamin B12, and iron through its Public Distribution System (PDS). These initiatives are expected to significantly boost the demand for functional foods and beverages.
As of 2023, the functional foods and beverages market was valued at USD 333.34 billion.
Information Source: https://www.fortunebusinessinsights.com/functional-foods-market-102269
Other than this, the report contains the following:
- Detailed segmentation of the market and piece-meal study of the each segment;
- Exhaustive research into the various market drivers and restraints;
- Comprehensive analysis of the regional developments and competitive milieu of the market; and
- Panoramic understanding of the industry outlook and trends shaping the market.
Market Driver
High Nutritional Value of Functional Foods to Spike Uptake
The rising popularity of fortified foods and beverages is largely driven by the fast-paced and often unhealthy lifestyles common in urban areas. This shift underscores a growing demand for nutrition-packed products, fueled by increasing awareness of health and wellness. Consumers are turning to functional foods for their long-term health benefits. For example, products fortified with omega-3 fatty acids are valued for their ability to improve brain function, promote heart health, and reduce inflammation. These benefits not only help address chronic and lifestyle-related health conditions but also play a critical role in tackling undernutrition. A report by the National Institutes of Health highlights the significant impact of fortified foods, noting that the introduction of iron-fortified wheat flour in Jordan led to a 50% reduction in iron deficiency anemia among children, underscoring the effectiveness of such products in combating nutritional deficiencies.
Regional Analysis
Evolving Lifestyles in Asia-Pacific to Aid the Region Register Impressive CAGR
The Asia-Pacific region is expected to dominate the functional foods and beverages market, with a projected compound annual growth rate (CAGR) of 9.20% during the forecast period. This growth is primarily driven by shifting lifestyles in the region, leading to an increase in chronic health conditions. For instance, the rising consumption of fast or "junk" food has heightened the demand for healthier, more nutritional options, particularly as health awareness grows in countries like India. Additionally, the demand for functional hydration products is significant in tropical countries, where high water loss due to climate increases the need for replenishing beverages.
North America is anticipated to be the second-largest market for functional foods and beverages, with a projected CAGR of 7.06% over the forecast period.
Competitive Landscape
Development of Exciting Products to Stimulate Intense Competition
A major trend in the functional foods and beverages market is the growing emphasis by leading companies on developing and launching innovative products. These frequent product introductions not only bolster companies' market presence but also continuously reshape the competitive landscape. By offering new and appealing options, firms can more effectively align themselves with shifting consumer preferences, ensuring they stay relevant and competitive in an evolving market.
Industry Developments:
- December 2019: GCI Nutrients, the US-based nutraceuticals leader, launched a new functional food and beverage technical advisory service. The aim behind setting up this division is to offer sound advice to customers who want to use the company’s branded ingredients to create their own functional food and beverage items.
- October 2019: The American functional beverage pioneer Drink Nutrient introduced a new drink line, with each individual pack delivering the 13 essential vitamins, thereby enhancing the nutrition quotient of one’s drink. The offering does not contain GMOs, acrylamide, gluten, or any artificial ingredients.
List of Key Players Covered in the Report:
- The Coca-Cola Company
- Celsius Holdings, Inc.
- PepsiCo, Inc.
- Glanbia plc
- Nestle S.A.
- Arla Foods amba
- Hearthside Food Solutions LLC
- Tyson Foods, Inc.
- General Mills, Inc.
- Danone S.A.
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