Food Encapsulation Market size in 2019 is estimated to be $4.5 billion and is forecast to be growing at a CAGR of 9.36% during the forecast period 2020-2025. Encapsulation involves the combination of food ingredients, enzymes, cells, or other materials in small capsules. Encapsulation in foods is also utilized to cover odors or tastes. Encapsulated materials can be protected from moisture, heat, or other extreme conditions that help to enhance the stability of food and maintaining viability. An increase in demand for convenience foods and growing health consciousness are the major factors driving the growth of the market. Moreover, increasing the adoption of encapsulated flavors further enhances the overall market demand for food encapsulation.

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Shell Material - Segment Analysis

Based on the shell material, the food encapsulation market is segmented into polysaccharides, emulsifiers, fats, lipids, protein, and others. The polysaccharides shell material is forecast to be the fastest-growing segment with a CAGR of 5.8% during the forecast period 2020-2025. This is mainly owing to benefits such as improved blood sugar level, cardiovascular health, and also improved immunity. Moreover, it helps in recovery from heart disease, improves liver function, provides energy to the body, and, keeps sugar level normal.

Method - Segment Analysis

Based on the method, food encapsulation is segmented into the physical process, chemical process, and physicochemical process. In 2019, the physical process accounted for a major share in the food encapsulation market. This is mainly owing to enhancing stability to temperature, moisture, oxidation, light, and masking undesirable flavors. Also, reducing negative interaction with other compounds and modify particle density are some factors driving the growth of this segment.

Geography - Segment Analysis

North America accounts for 33% of the food encapsulation market share in 2019. This is mainly owing to the high availability of shell materials and a large number of manufacturers. According to the Food and Drug Administration, U.S. exports of prepared fats and oils have amounted to $32 million, with $25 million to Canada and $4 billion to Mexico. There are likely to be increased U.S. imports of encapsulated fish oil from Canada. For total U.S. trade, there are likely to be increased U.S. imports of encapsulated fish oil.

However, Asia-Pacific is projected to be the fastest-growing during the forecast period 2020-2025. The increasing demand for processed food, a flourishing food industry, increasing living standards, and rising economies in developing countries that are factors driving the growth of the food encapsulation market in this region. 

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Drivers – Food Encapsulation Market 

Increasing Demands for Convenience Foods

Increasing demand for convenience foods and growing awareness about increasing the taste, color, and flavor of such foods is a major factor in the growth of the food encapsulation market. This is mainly owing to benefits offered by convenience foods such as lower time spent on planning meals, and ease of preparing which contributes to the increase in market growth

Growing Health Consciousness 

Growing health consciousness and increasing dietary supplements are some factors driving the growth of the market. Besides, increasing demand for processed food, busy schedule, and changing lifestyles of people are contributing to the market growth.

Challenges – Food Encapsulation Market 

The high cost of encapsulation technology and lack of technological developments create a hurdle for the growth of the market. Growing alternative techniques such as co-crystallization further hinders the growth of the market.

Developments:

November 2019: Givaudan, a leading flavor company announces breakthrough fat encapsulation technology for plant protein which helps reduce up to 75% of the fat content. Fat encapsulation provides the benefit of increased authenticity and impacts through flavor stabilization.

16 December 2019: Balchem Corporation announced the acquisition of Zumbro River Brand Inc., in developing extruded products for the food and beverage industry.

25 March 2020: Evolva, the Swiss biotech company a new collaboration agreement with International Flavors and Fragrances, a leading global creator of taste to further develop and expand commercialization of vanillin.

March 2020: Firmenich has announced the acquisition with DRT (Derives Resiniques et Terpeniques) which is one of the leading suppliers globally of high-quality renewable ingredients.

Key Takeaways

In 2019, North America accounts for a major share of the food encapsulation market owing to the high availability of shell materials such as emulsions and the presence of a large number of manufacturers.

Increasing demand for convenience foods and growing health consciousness aid in market growth.

Detailed analysis of the Strength, Weakness, and opportunities of the prominent players operating in the market will be provided in the Food Encapsulation Market report.

The high cost of encapsulation technology and lack of technological developments create a hurdle for the growth of the market.

Food Encapsulation Industry Outlook

Product launches, Merger & Acquisitions, Joint Ventures, and R&D activities are key strategies adopted by players in the food encapsulation market. Food encapsulation top 10 companies are Taste Tech Ltd., Givaudan SA, Sensient Technologies Corporation, Balchem Corporation, International Flavors & Fragrances Inc., BASF SE, Symrise AG, Appvion Inc., AVEKA Group, Firmenich International SA, and Koninklijke DSM N.V.

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