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The functional food and drink market is outpacing the conventional food and drink market in terms of global growth, by about 4% per year.
The functional food and drink market is outpacing the conventional food and drink market in terms of global growth, by about 4% per year, according to a recent Leatherhead Food Research report in June.
Between 2003 and 2010, the global functional food and drink market increased 1.5 times, with a CAGR of 14%, reaching $24.2 billion USD in 2010. Comparatively, global sales in 2009 were $22.9 billion and $17.4 billion in 2006, $16.1 billion in 2005, and $9.9 billion in 2003.
Japan consistently leads demand, followed by the United States and then Europe and Australia. (The report defines the global market as these four regions.) Between 2010 and 2014, Leatherhead forecasts a total global market growth of 22.8%, to reach $29.8 billion by 2014. Broken down by location, that’s 21% growth in Japan by 2014, to reach $11.3 billion; 20.7% growth in the United States, to reach $9.1 billion; 27% growth in Europe, to reach $8.9 billion; and 34.2% growth in Australia, to reach $530 million.
Dairy accounts for the largest share of functional foods, followed by bakery/cereals, beverages, and fats and oils. In terms of CAGR, however, bakery/cereals are leading (18%), followed neck and neck by fats and oils (14%) and dairy (14%). Functional beverages are growing at 6% CAGR.
In terms of condition-specific product-launch health claims, heart- and digestive-health claims have declined, although digestive-health claims remain the most common functional food claims on the market. Immune-health claims have steadily grown and now outnumber cardiovascular claims. Other claims seeing growth are bone-health and vitamin/mineral-fortified claims.
Survey results also showed that consumers are more aware of certain functional ingredients over others. In particular, consumers are able to link the following: omega-3 and heart health, omega-3 and cognitive health, collagen and beauty benefits, and Lactobacillus casei and digestive health.
Leatherhead defines functional food as “food and drinks carrying a health claim,” excluding energy products.
Leatherhead also notes the following:
A number of factors have facilitated the growth of functional foods. Changes in consumers’ diet, lifestyles, awareness, and interest in their own health and well-being are important factors creating a demand-pull for products with the potential to deliver beneficial health outcomes. Supply-push factors are evident, too. Expanding scientific knowledge and technological capability, particularly ingredient exploration and development, has led to increased product innovation. Consequently, the number of new product introductions making functional claims has been growing by approximately 28% per year, and the diversity of claims and suggested health benefits have been diversifying.
The ability for the functional foods market to continue to grow is dependant on several factors:
For more on this report, visit http://www.leatherheadfood.com/long-may-the-growth-in-functional-foods-continue