The global specialty ingredients market size was valued at USD 93.3 billion in 2014 and is expected to expand at a CAGR of 5.4% over the forecast period. Increasing health consciousness among consumers is driving the demand for high quality and greener products, which, in turn, is expected to boost the market growth. Rising disposable income, along with changing consumer lifestyles owing to rapid urbanization, is expected to increase the demand for specialty ingredient in various end-use industries, such as food and beverage, pharmaceutical, personal care, and animal feed.
Increasing demand for leisure products in various countries including China, India, Indonesia, Malaysia, and Japan is expected to drive the food and beverage industry over the next seven years, which, in turn, is expected to positively impact specialty ingredients market growth. High demand for processed products on account of advancements in processing and preservation technologies like cold storage, climate control storage, and pasteurization is expected to fuel the product demand over the forecast period. Asia Pacific is expected to witness significant growth on account of increasing production of processed foods and innovation in segments, including bakery and confectionery, dairy, oils, and meat products. Therefore, such factors are expected to augment product demand in the food and beverage industry.
Decreasing use of harmful chemicals including phthalates, aluminum salts, and parabens, coupled with constant efforts by numerous multinational corporations to shift towards sustainable products, has contributed to increasing consumption of organic personal products. Cosmetics containing natural ingredients including aloe vera, tea extract, lime content, and black sugar are expected to gain traction among consumers over the next few years.
Increasing usage of natural ingredients such as herbs, vegetables, and fruits in skin care products with anti-aging properties is expected to fuel the product demand. Rising awareness among consumers regarding benefits of natural ingredients including dandruff protection, hair fall control, and shining effect is expected to have a favorable impact on the specialty ingredients market growth.
Growing health awareness among consumers is expected to shift their focus towards nutritional and healthy diets. Rising health complications such as diabetes, cardiovascular problems, and obesity, particularly among the younger generation, has prompted a shift in dietary trend towards healthy and nutritional diet and away from junk food, alcohol, and meat consumption.
A wide range of raw materials is used to derive specialty ingredients for various application segments. The type of raw material totally depends on the application segment including food, pharmaceutical, personal care, animal feed, paints and coatings, and building and construction. In recent years, customer requirements are changing mainly owing to increasing health issues, environmental impacts, lack of nutrition in diets, and skin anti-aging problems, which, in turn, is negatively impacting overall supplies.
The demand for natural colorants is driving the market as the preferences for clean label products are increasing. The specialty ingredients are also responsible for improving the nutritional value of processed foods. The changing customer preferences towards healthy alternatives are increasing the demand for these ingredients in various industries leading to the growth of the market.
The increasing use of personal care products is escalating the awareness among the customers regarding the chemicals used in these products. Therefore, this is increasing the demand for organic ingredients over the ingredients used in many personal care products and toiletries, which is driving the personal care specialty ingredients market.
There are several health-related issues associated with a few chemicals that make synthetic ingredients. For example, hydrogen cyanide is present in the benzaldehyde compound used in different flavors that are responsible for depression and convulsion in the central nervous system. Similarly, amyl acetate by which different synthetic flavors are made can cause headache, fatigue, chest pain, indigestion, and irritate the mucus membrane, these factors are hampering the market growth.
One of the strategies adopted by the industries is the launch of new products and technological advancements which is expected to bring numerous opportunities to the market. The technological developments will also create a growing demand for health-related foods. Many startups in the market are driving the new product innovations.
The COVID-19 pandemic has adversely affected several industries, the manufacturing industry was one of the industries that were affected to some extent. Delays in manufacturing activities and closing of several end-use industries such as personal care, food & beverages in developed as well as developing countries impacted the specialty ingredient market growth during this period. Although the specialty ingredient industry experienced problems related to supply chain, workforce, and lack of supply of raw materials. The governments in some countries have granted a special license to the food and pharmaceutical industries which has resulted in demand for specialty ingredients.
The food and beverage application segment dominated the global market. Global manufacturers use specialty ingredients to enhance product quality, color, texture, and add nutritional value. Shift in consumer behavior towards organic products is expected to boost overall growth over the forecast period.
The food and beverage industry is mainly driven by increasing demand for organic items and consumer shift towards healthy lifestyle. The industry is expected to witness significant growth in developing regions, mainly Asia Pacific. The industry is expected to witness high growth in BRICS and Middle East in light of domestic consumption, which, in turn, is expected to drive global market in the near future. Based on the product type, food and beverage is broadly categorized as sensory and functional products.
The personal care segment accounted for a revenue share of 9.8% in 2014. The segment is expected to witness high growth over the forecast period owing to growing skin aging problems, coupled with skin diseases caused due to harmful UV radiations and other noxious constituents. The personal care industry utilizes specialty ingredients to develop skincare, haircare and oral care products. Manufactures are investing in R&D initiatives to develop technological solutions in the personal care industry. Personal care is further segmented into active and inactive products.
The pharmaceutical industry is expected to witness high growth over the forecast period on account of technological advancements, coupled with increasing customer expectations. The segment includes active and inactive ingredients. Government initiatives to develop well-established healthcare facilities and infrastructure in emerging economies, including Asia Pacific and Middle East and Africa, are boosting the segment growth.
North America dominated the global market and accounted for a revenue share of 31.7% in 2014. Increasing demand for organic products, mainly in the food and beverage and personal care industries, coupled with rising investments in R&D initiatives to improve health issues, is expected to drive industry demand in the region over the forecast period.
Asia Pacific was the second largest regional market on account of high product demand in emerging economies mainly India, China, Japan, and South Korea. Aging population, coupled with changing consumer lifestyle, is expected to drive the overall revenue in future. Europe also covered a significant share in the global market but is expected to expand at a lower CAGR over the forecast period.
Middle East and Africa and Central and South America are also expected to witness significant growth over the forecast period. Over the forecast period, consumers are expected to increase their spending on personal care products, mainly skin care, which, in turn, is expected to drive overall demand in the Middle East and Africa. The market in Central and South America is expected to expand at a CAGR of 5.4% over the forecast period owing to increasing demand for personal care ingredients in the region.
Key manufacturers involved in the business are Naturex; Frutarom; Ashland Inc.; Archer Daniels Midland; DuPont; Inolex; and Associated British Foods. There is a low degree of integration across the value chain. Most of the suppliers are based in North America. Key specialty ingredient suppliers include Eli Fried Inc.; St. Louis Food Ingredients; Additive Solutions; CK Ingredients; KF Specialty Ingredients; Vantage Specialty Ingredients; and Royal DSM. The market is marked by the presence of a number of multinationals and smaller firms. Small firms offer technical expertise but are generally financially unstable.
Therefore, multinationals are acquiring small firms in order to expand their business and gain technical expertise. Mergers & acquisitions are expected to increase in the market over the forecast period. Manufacturers are expected to expand their business in Asia Pacific to offer affordable and high quality products. New entrants are expected to enter into the industry in the future on account of high demand in the countries of Asia Pacific, mainly China, India, South Korea, and Japan.
Stringent regulatory framework in Europe for synthetic and unhealthy food products is compelling manufacturers to develop innovative, healthier, and greener solutions for the food and beverage industry. Regulatory framework is expected to favor in Asia Pacific over the forecast period. Growing consumer demand for specific and customized products is driving the need for high performance technological expertise as well as research & development initiatives.
In May 2022, Ashland Global Holdings Inc., a global additives and specialty ingredient company launched PolyclarTM brewbrite granules, an easier solution for upstream clarification. This product is easy to handle and cost-saving.
In April 2022, IFF, an industry leader in biosciences and scents, beverages, health, and food announced the complete acquisition of Health Wright Products, LLC (HWP), a leader in the dietary supplement industry. This acquisition enables HWP to expand capabilities and invest in capacity to meet the evolving needs of customers and consumers.
In January 2021, INOLEX has issued a patent on multifunctional preservation systems. Patent claims the compositions of the ingredients can be used in formulations and blends containing CHA-diol compositions.
Revenue forecast in 2022
USD 141.12 billion
CAGR of 5.4% from 2015 to 2022
Base year for estimation
2012 - 2013
2015 - 2022
Revenue in USD billion and CAGR from 2015 to 2022
Revenue forecast, company ranking, competitive landscape, growth factors, and trends
North America, Europe, Asia Pacific, Middle East, And Africa
U.S.; Canada; U.K.; Germany; Italy; China; Japan; India; Saudi Arabia; Brazil
Key companies profiled
Naturex; Frutarom; Ashland Inc.; Archer Daniels Midland; DuPont; Inolex; Associated British Foods.
Free report customization (equivalent to up to 8 analysts working days) with purchase. Addition or alteration to country, regional & segment scope.
Pricing and purchase options
Avail customized purchase options to meet your exact research needs. Explore purchase options
This report forecasts revenue growth at global, regional & country levels and provides an analysis on the latest trends and opportunities in each of the sub-segments from 2015 to 2022. For the purpose of this study, Grand View Research has segmented the antipsychotic drugs market on the basis of application, and region:
Application Outlook (Revenue, USD Million, 2012 - 2022)
Food & beverage
Functional feed ingredient
Regional Outlook (Revenue, USD Million, 2012 - 2022)
Middle East & Africa (MEA)
Central & South America (CSA)
NEED A CUSTOM REPORT?
We can customize every report - free of charge - including purchasing stand-alone sections or country-level reports, as well as offer affordable discounts for start-ups & universities. Contact us now
"The quality of research they have done for us has been excellent."