US demand for food additives is expected to grow 4.5 per cent per year to $5 billion (€5.1bn) in 2006, spurred by growth in value-added products designed for specific applications, according to a new report from market researchers, The Freedonia Group.
Heightened consumer interest in nutritionally enriched and all-natural foods will drive demand for nutraceuticals, natural colouring and flavouring agents, and other value-added food additives.
Flavours and flavour enhancers, writes Freedonia, will remain the largest segment of the additives market, accounting for nearly 45 per cent of aggregate demand in 2006. Interest in ethnic, intense and indulgent flavours will be a driving force in flavour and flavour enhancer demand, although slowing sales of processed foods (the largest flavours market) will limit annual gains to 4.3 per cent up to 2006.
Freedonia reports that alternative sweeteners will record the fastest growth, with advances of 6.5 per cent yearly, boosted by recent introductions of high-intensity sweeteners such as sucralose and neotame. However, these additives will still account for only one per cent of total additives demand due to their niche status as speciality sweeteners in diabetic and reduced-calorie foods.
Strong gains are also forecast for bulk nutraceutical additives and enzymes, with growth for each exceeding five per cent per annum. Further increases will be restrained by the higher price tag typically attached to these enriched offerings and growing pessimism over their efficacy.
The best prospects are forecast for calcium, vitamin E, beta carotene and numerous smaller volume nutraceuticals, including soy protein and isoflavones, lycopene and lutein. Gains in the enzyme segment will be supported by expanding applications, including the production of lactose-free dairy products, bakery products with extended shelf lives, and cooking oils with healthier profiles.
Snack foods are expected to be the fastest growing market for food additives, advancing six per cent per year, albeit from a relatively small base. Gains will be led by flavours, which play an increasingly important role in differentiating snack products, with nearly half of all chips consumed being of a flavoured variety, and category leaders in snack foods generally introducing several new flavours every year.
Grain mill products also present above-average opportunities for food additives, with annual gains of five per cent up to 2006, stimulated by the incorporation of a widening array of nutraceutical additives. According to Freedonia, a growing pet population and a healthy economy which supports purchase of higher quality pet food (containing higher value additives) will also spur growth.