April 21, 2024
Functional Food Market

The Global Functional Food Market to Gain Traction from Rising Health Awareness Trends

Functional foods are foods that provide health benefits beyond basic nutrition by offering protection against diseases. They contain biologically active components that provide specific health benefits. Functional foods include fortified foods such as yogurt with added probiotics, bread with added fiber and omega-3 fatty acids, and fruit juices with added vitamins. Increasing awareness about health and nutrition has seen a surge in demand for functional foods in recent years. Functional foods are used for weight management, diabetes management, heart health, digestive health, bone and joint health, brain and memory function, and more. Rising incidence of chronic diseases worldwide is spurring consumers to adopt healthier eating practices and integrate functional foods and beverages into their diets.

The global functional food market is estimated to be valued at US$ 235.27 Mn in 2023 and is expected to exhibit a CAGR of 7.4% over the forecast period 2023 to 2031, as highlighted in a new report published by Coherent Market Insights.

Market Dynamics
Rising Health Awareness Trends: The growing trend of health and wellness is a key driver boosting demand for functional foods. Increasing awareness about the role of nutrition in maintaining good health is prompting consumers globally to opt for fortified and enriched food products that deliver additional health benefits. The COVID-19 pandemic has further highlighted the importance of good immunity and nutrition, fueling interests in functional foods that can aid digestion, metabolism, cognitive function, heart health, and more. This emerging trend is expected to significantly support market revenue growth over the forecast period.

Functional Food Market Opportunity from Fortification: Fortification of staple foods and drinks with essential micronutrients has emerged as a promising opportunity, as it is an effective strategy to meet the nutrient gaps in populations. Food fortification provides a cost-effective and simple solution to address deficiencies. Rising cases of hidden hunger worldwide is fueling initiatives and regulations for fortifying foods with vitamins and minerals during processing. This offers a massive opportunity to functionalizing foods across developing regions and provide optimum nutrition.

Segment Analysis
The functional food market is dominated by the dairy products sub-segment due to the increasing demand for probiotic yogurts and drinks. Dairy products are rich in important nutrients and play a vital role in maintaining bone health, heart health and immune system. With the rising health consciousness, dairy products fortified with probiotics, prebiotics, vitamins, minerals etc. are gaining high traction. Probiotic dairy products help maintain the balance of good bacteria in gut and offer several digestive health benefits.

PEST Analysis
Political: Governments across regions are supporting the growth of functional food market through favorable regulations that promote the health benefits of fortified and enriched food products. Many nations have implemented nutrition policies that encourage food fortification.
Economic: Rising disposable income and growing health expenditure is fueling the demand for premium functional food products globally. The increasing chronic diseases burden on healthcare systems is further driving the demand.
Social: Changing consumer preferences towards health, wellness and preventive healthcare have increased the adoption of functional food and beverages. Consumers are increasingly demanding food with added nutrients.
Technological: Advancements in microencapsulation, enzymatic techniques and food processing have enabled effective fortification and enrichment of wide range of food products with probiotics, prebiotics, vitamins and minerals without compromising the taste and texture. This is supporting new product development.

Key Takeaways
The Global Functional Food Market Size is expected to witness high growth over the forecast period 2023-2031 supported by growing health awareness, increasing chronic diseases prevalence and rapid urbanization. The global functional food market is estimated to be valued at US$ 235.27 Mn in 2023 and is expected to exhibit a CAGR of 7.4% over the forecast period 2023 to 2031.

Regional analysis
The Asia Pacific region is expected to emerge as the fastest growing market for functional food during the projected period driven by rising health expenditure, large consumer base and growing western influence. Countries like India, China and Japan are witnessing tremendous demand for functional bakery, dairy and confectionery products.

Key players
Key players operating in the functional food market are General Mills, Kellogg Co., Nestle and PepsiCo. Nestle is the global leader in functional food and beverage category offering brands like BOOST and LC1. PepsiCo markets various Quaker oats products fortified with vitamins, iron etc.

*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it