Functional Food Ingredient Market- Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The Functional Food Ingredient Market is segmented by Type (Vitamins, Minerals, Prebiotics, Probiotics, Hydrocolloids, Essential Oils, Omega-3 & 6 Fatty Acids, Carotenoids). Application (Bakery & Cereals, Dairy Products, Meat, Fish & Eggs, Soy Products), Purpose (Sports Nutrition, Weight Management, Immunity, Digestive Health, Clinical Nutrition, Cardio Health), and Geography (North America, Europe, Asia-Pacific, South America, and Middle-East and Africa). The report offers market size and forecasts for functional in value (USD million) for all the above segments.

Market Snapshot

Functional Food Ingredient Market Summary
Study Period: 2016-2027
Base Year: 2021
Fastest Growing Market: Asia-Pacific
Largest Market: North America
CAGR: 6.8 %
Functional Food Ingredient Market Major Players

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Market Overview

The functional food ingredient market is estimated to record a CAGR of 6.8% during the forecast period (2022-2027).

Due to COVID-19, raw material costs are expected to rise due to trade obstacles, interruptions in raw material supply, and inefficient distribution systems. The worldwide functional food ingredients market is projected to face challenges due to the scarcity and high cost of raw materials and high production costs. The security of the food supply chain is becoming increasingly critical in the COVID-19 era. Because most vitamins are imported from China, there was a scarcity of vitamins, and COVID-19 had a detrimental influence on transportation. The COVID-19 epidemic has brought attention to the global supply chain's vulnerability. Due to trade obstacles, manufacturers are looking for alternate ingredients. On the other hand, local merchants and regional raw material suppliers will benefit. Many convenience food enterprises throughout the world were shut down during Covid 19. As a result, demand for functional food components was originally modest.

Functional food ingredients in functional food are targeted to offer specific functions that are more than just basic nutrition. These ingredients play a vital role in protecting against acute and chronic diseases. Functional foods contain natural or synthetic ingredients that promote optimal health and provide energy-boosting benefits. Prebiotics are one such ingredient that promotes the growth of bacteria in the large intestine that are beneficial to intestinal health while inhibiting the growth of bacteria that are potentially harmful to intestinal health.

The functional food ingredients market is anticipated to grow in the forecast period owing to driving factors such as a rise in consumption of fortified food on account of increasing health awareness among consumers and demands for nutritious convenience food. Furthermore, growing incidences of chronic diseases propel the demand for functional food, thus, boosting the growth of the functional food ingredients market. Nonetheless, the market opportunity lies in the growing health-conscious population in developing nations during the forecast period.

Scope of the Report

Functional foods are ingredients that offer health benefits that extend beyond their nutritional value. Some types contain supplements or other additional ingredients designed to improve health. The Functional food ingredient market is segmented by type into vitamins, minerals, prebiotics, probiotics, hydrocollooids, essential oils, omega-3 & 6 fatty acids, and carotenoids. By Application into Bakery & Cereals, Dairy Products, Meat, Fish & Eggs, Soy Products. Geography by North America, Europe, Asia-Pacific, South America, and Middle-East and Africa. For each segment, the market sizing and forecasts have been done on the basis of value (in USD million).

By Type
Essential Oils
Omega-3 & 6 Fatty Acids
By Application
Bakery & Cereals
Dairy Products
Fish & Eggs
Soy Products
North America
United States
Rest of North America
United Kingdom
Rest of Europe
Rest of Asia-Pacific
South America
Rest of South America
Middle-East and Africa
United Arab Emirates
South Africa
Rest of Middle-East and Africa

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Key Market Trends

Growing Consumption of Nutrient-enriched Foods/Fortified Food

The global demand for fortified foods is rapidly increasing. Vitamins, minerals, antioxidants, hydrocolloids, prebiotics, amino acids, plant extracts, and carotenoids are some of the most important functional food constituents. In emerging economies, the population of health-conscious people is quickly growing, fueling the demand for food fortification. The apparent disparities in population health among nations are mostly due to variances in dietary intake across areas. Increasing cases of chronic diseases and micronutrient deficiencies, the growth of the middle class in emerging economies, new government fortification programs, the growth of the world's older population in regions such as Europe, and rising interest in health and wellness as a result of COVID-19 are all expected to drive sales.

Functional Food Ingredient Market: Health Food and Beverage Market, Share (%), By Product Category, 2020

North America Holds the Largest Share

The healthcare expenditure pattern in North America is growing each day. Therefore, consumers in the country are adopting preventive healthcare measures such as eating nutritious food. This factor is further driving the overall sales of functional food in the country. Furthermore, in North America, the sales of breakfast cereals are expected to benefit from the acceleration of a broad range of trends affecting the eating habits of Americans. A permanent shift away from three square meals a day to snacking and consuming multiple smaller meals throughout the day, rapid growth in the number of Americans actively engaged in fitness and weight management programs, and the desire for consumers to seek out alternative foods for breakfast are some of the factors boosting the demand for functional breakfast cereals.​

In 2020, the market will be dominated by the North American region. The prevalence of chronic illnesses as a result of hurried lives and growing consumer knowledge of the health advantages of functional foods are driving this dominance. Furthermore, the region has the greatest obesity rate. The functional food ingredients industry is investing more money into research programs to introduce new ingredients that will meet the diverse needs of potential customers in the region. Cargill, Incorporated (US), Archer Daniels Midland Company (US), and DuPont are the major companies in the North American functional food ingredients market (US). These companies have research and development labs where they create a wide range of functional food additives for the food and beverage industries. In 2020, Cargill made a USD 146 million to expand its protein production facility in Nashville, Tennessee, US.

Functional Food Ingredient Market: Market Size (%), By Region, Global, 2021

Competitive Landscape

Key players in this market include Cargill, Incorporated (US), BASF SE (Germany), Archer Daniels Midland Company (US), DuPont (US), Arla Foods (Denmark), Kerry Group (Ireland), Ajinomoto Co. Inc. (Japan), Koninklijke DSM NV (Netherlands), Ingredion Incorporated (US), and Tate & Lyle PLC (UK). Some of the other players include Chr. Hansen Holding A/S (Denmark), Kemin Industries, Inc. (US), BENEO (Germany), Royal Cosun (Netherlands), Roquette Frères (France), Soylent (US), A &B Ingredients (US), Golden Grain Group Limited (China), Sugarlogix (US), and Stratum Nutrition (US).

Major Players

  1. Cargill, Incorporated

  2. Archer Daniels Midland Company

  3. BASF SE

  4. DuPont

  5. Kerry Group

Functional Food Ingredient Market Concentration

Recent Developments

· In July 2021, Kerry Group, an Irish-based food company, announced that it is acquiring Biosearch Life for a USD150 million deal amount. Through this acquisition, Kerry Group can expand its healthy ingredient portfolios, such as probiotics and omega-3.

· In September 2020, BASF SE, Azelis, and BASF agreed on a partnership for health ingredients and colorants in Greece's food and beverage and dietary supplement market segments.

· In September 2020, Kerry expanded its nutritional plant protein range, Pevesa Biotech, to expand its position in non-allergic and organic plant protein ingredients.

Table of Contents


    1. 1.1 Study Assumptions and Market Definition

    2. 1.2 Scope of the Study




    1. 4.1 Market Drivers

    2. 4.2 Market Restraints

    3. 4.3 Porter's Five Forces Analysis

      1. 4.3.1 Threat of New Entrants

      2. 4.3.2 Bargaining Power of Buyers/Consumers

      3. 4.3.3 Bargaining Power of Suppliers

      4. 4.3.4 Threat of Substitute Products

      5. 4.3.5 Intensity of Competitive Rivalry


    1. 5.1 By Type

      1. 5.1.1 Vitamins

      2. 5.1.2 Minerals

      3. 5.1.3 Prebiotics

      4. 5.1.4 Probiotics

      5. 5.1.5 Hydrocolloids

      6. 5.1.6 Essential Oils

      7. 5.1.7 Omega-3 & 6 Fatty Acids

      8. 5.1.8 Carotenoids

    2. 5.2 By Application

      1. 5.2.1 Bakery & Cereals

      2. 5.2.2 Dairy Products

      3. 5.2.3 Meat

      4. 5.2.4 Fish & Eggs

      5. 5.2.5 Soy Products

    3. 5.3 Geography

      1. 5.3.1 North America

        1. United States

        2. Canada

        3. Mexico

        4. Rest of North America

      2. 5.3.2 Europe

        1. Germany

        2. United Kingdom

        3. France

        4. Russia

        5. Italy

        6. Spain

        7. Rest of Europe

      3. 5.3.3 Asia-Pacific

        1. China

        2. India

        3. Japan

        4. Australia

        5. Rest of Asia-Pacific

      4. 5.3.4 South America

        1. Brazil

        2. Argentina

        3. Rest of South America

      5. 5.3.5 Middle-East and Africa

        1. United Arab Emirates

        2. South Africa

        3. Rest of Middle-East and Africa


    1. 6.1 Most Active Companies

    2. 6.2 Market Share Analysis

    3. 6.3 Strategies Adapted by Leading Companies

    4. 6.4 Company Profiles

      1. 6.4.1 Cargill, Incorporated

      2. 6.4.2 BASF SE

      3. 6.4.3 Archer Daniels Midland Company

      4. 6.4.4 DuPont

      5. 6.4.5 Arla Foods

      6. 6.4.6 Kerry Group

      7. 6.4.7 Ajinomoto Co. Inc

      8. 6.4.8 Koninklijke DSM NV

      9. 6.4.9 Ingredion Incorporated

      10. 6.4.10 Tate & Lyle PLC

    5. *List Not Exhaustive


**Subject to Availability
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Frequently Asked Questions

The Functional Food Ingredient Market market is studied from 2016 - 2027.

The Functional Food Ingredient Market is growing at a CAGR of 6.8% over the next 5 years.

Asia-Pacific is growing at the highest CAGR over 2021- 2026.

North America holds highest share in 2021.

Cargill, Incorporated , Archer Daniels Midland Company , BASF SE , DuPont, Kerry Group are the major companies operating in Functional Food Ingredient Market.

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