Food Colorants Market Size, Share, Industry, Forecast and Outlook (2024-2031)

Global Food Colorants Market is segmented By Type (Natural, Synthetic), By Form (Powder, Liquid, Gel & paste), By Application (Food (Dairy food, Bakery items, Seafood), Beverages (Alcoholic, Non- alcoholic), Cosmetics, Pharmaceuticals), and By Region (North America, Latin America, Europe, Asia Pacific, Middle East, and Africa) – Share, Size, Outlook, and Opportunity Analysis 2024-2031

Food Colorants Market Size

The Global Food Colorants Market valued USD 2,194.34 million in 2021 and is expected to grow at a CAGR of 12.4% to reach a market value of USD 3,537.10 million by 2031. The growing food & beverage industry is one of the major factors that boost the market growth exponentially.

The food colorants market is expected to hold for maximum growth rate during the forecast period. Natural food colorant bases such as saffron, turmeric, paprika, annatto, and beetroot are gaining popularity due to their safe consumption and zero synthetic properties. Furthermore, a growing number of health-conscious consumers would have a positive impact on market demand. Organic product sales, including natural colors, increased by 15% in 2017, according to retail giant Tesco, as consumers evaluate labels and certification before purchasing, fueling product development.

Food Colorants Market Summary

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What are Food Colorants?

Food coloring or color additive is any dye, pigment, or substance that imparts color when added to food or drink. Food coloring is used both in commercial food production and in domestic cooking. Consumers typically associate certain colors with specific flavors, and the color of food can influence the perceived flavor in anything from candy to wine. Thus, an increase in the usage of these products by various end-user industries is expected to drive the food colorant market in the forecast period.

Market Demand

Food colorants and flavors are an important part of any food industry. Natural colorants and flavors are used to enhance the overall appearance of food products. The demand for natural ingredients in food products has increased rapidly in recent times. Several new food products are coming every day with natural food ingredients. Major food manufacturers and retailers around the world have made the availability of natural food and beverage products easy.

Consumers are following the "be natural and go green" policy in food products. Every application in the food and beverage industry, from confectionery, bakery products to alcoholic beverages, is trying to represent itself as natural food application because of the current demand pattern.

The increasing demand for natural food products has led to manufacturers using new natural colorants and flavors in their products. Many food manufacturing companies are using only natural ingredients in their new food products.

Increasing new applications in the food industry is also supporting the growth of the global natural colorant and flavor market. Food manufacturing companies are encouraging the demand for natural colorants and flavors for their existing and new product ranges.

Key Opportunities in the global market

An increase in the disposable income of consumers is also contributing to the increasing demand for packaged food products. The shift of packaged food products from synthetic ingredients to natural ingredients has led the market growth. Consumers prefer packaged food products over open food products prepared by roadside vendors due to hygiene and food safety issues. Due to the alter in consumer lifestyle the demand for packaged food and beverages products are growing and leads to the growth of the food colorants market.

Market Restraints

The natural food colors market is characterized by the presence of a significant number of small players, only the major vendors enjoy the technological leverage and sophisticated techniques of maintaining the best quality. These major suppliers in order to secure their discoveries and support their R&D efforts often patent their products, which in turn reflects in high prices for the primary consumers such as the dairy industry, breweries, and convenience food industry. Stringent laws and regulations are a challenge to the global food colorants market. The food and beverage colorants market is highly regulated in regions such as North America and Europe. There are many procedural formalities that are imposed on vendors. In the US and Europe, statutes define that a particular colorant can only be used for a certain food.

Food Colorants Market Dynamics and Trends

• The growing food & beverage industry is one of the major factors that are boosting the market growth exponentially. Because colors can also protect vitamins and flavors that may be affected by sunlight during storage.

• By using colors, we can enhance the natural color of a dish and introduce decorative colors to other foods. Also, the color of the food can influence the perceived flavor.

• Besides, increasing consumer demand for processed foods leads to increase consumption of food colorants. For instance, according to the American Chemical Society (ACS), about 70% of the diet of the average US resident is from processed foods.

• The stringent food standards regulations by the FDA and several regulatory bodies is proving to be a constraint for manufacturers. Also, natural colorants are expensive and not affordable by most users. Thus, these factors are hindering market growth.

Food Colorants Market Segmentation Analysis

Based on the type the global food colorants industry is broadly segmented as natural and synthetic colorants. Between this synthetic food, colorants held the majority share in 2017. Due to the low price, extended shelf life, stability, and easy availability in bulk form.

In addition, a preference for synthetic colors such as blue and green from the beverage industry will aid market penetration. However, in the forecast period, natural colorants are predicted to grow at a high CAGR. It is owing to an increase in the number of health-conscious consumers that have grown exponentially over the years, thereby instigating a demand for organic products including natural colorants. Additionally, increasing awareness of safety concern policies about clean labeling augments product penetration.

Based on the application the global food colorants market is segmented into food, beverage, pharmaceuticals, cosmetics, and others.

Among all these beverages accounted for the major market share and is expected to grow at a high CAGR over the forecast period due to increasing demand for both alcoholic beverages. Also, increasing demand for soft drinks, energy drinks, ready-to-drink coffee, and juices are among key applications for synthetic colorant products.

Global Food Colorants Market Geographical Share

The global food colorants industry is segmented into North America, Europe, Asia Pacific, South America, and Middle East & Africa.

Regional Analysis:

North America is estimated to account for the highest share in total dollar sales in 2019. Increased demand and consumer preference for minimally processed foods and natural foods with health-promoting properties of colorants are expected to drive the North American food colorants market. The U.S dominated the market for North American food colorants with market revenue's largest share in 2019. The stringent norms for food colorants in the United States are primarily due to the increasing incidences of foodborne illness and increasing demand for safe food products, free from obnoxious food additives.

North American food colorants market is estimated to have decent value by 2029, growing at a CAGR of 5.50% during the forecast period. Food colorants currently dominate the North American market, owing to changing lifestyle and health consciousness of consumers towards natural food colorants.

On the other hand, the Canadian food colorants market is expected to grow with a CAGR of 5% during the forecast period. Canada is expected to follow the U.S. in terms of opting for food colorants that are officially listed and validated for their safety of use in food products. Calico is one of the key players in Canada offering a complete line of natural colors to serve the Canadian and U.S. market. On the other hand, Argentina contributed 11% market revenue share in the year 2019. Argentina's food colorants market is expected to grow with the uppermost growth rate during the forecast period.

Since Brazil is primarily an agricultural and food-based economy, the growing food production and, as a result, the rising food processing sector, is expected to positively impact the food colorants market. Because of their enormous interest in natural food colors, Brazil is one of the most diverse markets for food colorants. In recent years, a large portion of the Brazilian population, especially children and the elderly have had adverse reactions to food dyes, such as those contained in flavored yogurts. This, in turn, has prompted the demand for food colorants derived from jambu, jabuticaba, jamelão, and other tropical fruits in the country.

Germany, the U.K, and France held market revenue shares of 20%, 13%, and 18% in the year 2019. The food and beverage industry in Germany is the fourth largest industrial sector in the country, with a production value of EUR 179.6 billion in 2017, and is expected to continue to grow in the coming years. This factor is expected to push the colorants being applied to the food and beverage market, thus pushing the market further.

Sensient Food Colors and BASF are some of the key players in Germany, offering food colorants.

On the other hand, the United Kingdom food colorants market is likely to reach decent value in 2029, growing with a CAGR of 6% during the forecast period. The global market in the United Kingdom is expected to expand due to rising demand from a variety of industries. The market in the United Kingdom is expected to be driven by rising consumer demand and favorable government policies.

France's food colorants market is expected to grow with a CAGR of 5.73% during the forecast period, owing to France’s robust bakery and confectionery industry. Sugar confectionery consumption in France is expected to rise as a result of population growth, retail market development, and stable economic growth, further driving the market growth. Strong and increasing awareness of natural food colors among the consumers and rising disposable income offer high growth potential for the development of the global market.

China, India, and Japan are some of the leading countries for the adoption and use of food colorants in APAC. China and Japan are well-established markets, contributing a significant market revenue share of 39% and 12% in the region. After Europe and the United States, Japan has the strictest regulations for the usage of synthetic colorants in food products. It has resulted in a ban on the trading of several products containing artificial colorants and provided an opportunity for manufacturers of natural color. The key driving factor for food colorants in Australia is shifting consumer preference towards colored food products. Moreover, edible color utilization to enhance the visual appeal and texture of the items is a key factor enhancing product penetration.

Food Colorants Companies and Competitive Landscape

The global market is consolidated with key players dominating the food colorants industry. Major players operating in the global food colorants market are BASF SE, Cargill, Incorporated, DSM, CHR Hansen, and Sensient Colors LLC among others. Top companies have high brand loyalty and a strong foothold in the global food colorants industry. Sensient and CHR Hansen are leading with sales revenue of nearly USD 270 million and USD 260 million in food colors, respectively in 2019

Major market players are building their brand equities through acquisitions and partnerships. For instance, in September 2020, Azelis and BASF Human nutrition agreed on a partnership for health ingredients & colorants in the food & beverage and dietary supplement market segments in Greece. Moreover, many vendors are planning on expanding their businesses to emerging markets such as Central and South America and APAC. For instance, in March 2019, Naturex introduced its new extraction line for spirulina production.