Food & Beverage Additives

US demand to reach $8.6 billion in 2014
US demand for food and beverage additives is forecast to reach more than $8.6 billion in 2014. Despite the maturity of the US food and beverage industry, additive producers will continue to build market value through the introduction of new and improved products. Advances will be fueled by increasing consumer interest in nutritionally enriched products and all-natural foods, which promotes demand for high value premium and natural additives. Processors seeking to create clean labels favor natural additives, as consumers are wary of foods with artificial-sounding ingredients. For example, rebiana, a natural sweetener derived from the stevia plant, is relatively new to the market and has already been incorporated into a number of beverages. Consumer desire for functional products that provide health benefits will promote demand for additives such as probiotics and other nutraceuticals.

Flavors and alternative sweeteners to remain key
Flavor products and alternative sweeteners will remain the largest product types in the US food and beverage additive market. Although the flavors segment is generally mature, the constant emergence of new food and beverage products continues to create new demand for flavors and enhancers. The inclusion of functional additives such as probiotics in a widening array of foods and beverages will benefit flavor demand, as these nutraceuticals are often associated with a bitter taste that must be masked by flavor additives. Among alternative sweeteners, aspartame will continue to account for the largest share of demand, based primarily on its widespread usage in diet carbonated soft drinks. However, more rapid gains will be achieved by sucralose, acesulfame potassium (ace-K) and certain polyols. Additionally, trends favoring natural products will bode well for stevia sweeteners, which were approved for use as food additives by the US Food and Drug Administration in late 2008.

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Nutraceuticals to be fastest growing additives
Nutraceuticals -- which include vitamins, minerals, herbal extracts and probiotics -- are projected to experience the most rapid gains. Advances will be based on the growing popularity of functional foods containing additives that promote health. Nutraceuticals will continue to expand their presence beyond traditional applications like breakfast cereals, milk, bread, yogurt and juices into a wide variety of other foods and beverages. Soft drinks, snack foods, desserts and candy are now being fortified with vitamins and minerals, while vitamins and herbal extracts are used to enhance bottled waters. Probiotics have found success in the yogurt segment and will increasingly be incorporated into a variety of other products, such as tabletop sweeteners, chocolate, nutrition bars and flavored chews.

Dairy product additives are forecast to achieve above-average gains due to accelerating growth in dairy product output, combined with the expanding use of probiotic ingredients in yogurt and other products. In the beverage market, carbonated soft drinks will remain the largest outlet for additives. However, this segment is mature and will provide only marginal gains. Significantly more rapid growth is expected in the smaller flavored water, sports drink and energy drink segments based on the expanding popularity of these beverages.