The Natural Food Colors Market is estimated to be valued at US$ 2.05 Bn or in 2023 and is expected to exhibit a CAGR of 6.6% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Overview:
Natural food colors are dyes, pigments or substances that impart color when added to food or drink. They are obtained from natural sources like vegetables, fruits and other plant or animal sources. Natural food colors provide aesthetic appeal and vibrancy to food products. With growing health concerns, more consumers are preferring products with natural ingredients and preservatives. This is increasing the demand for natural food colors.
Market key trends:
A key trend driving the natural food colors market is the growing demand for clean label products. With increasing awareness, consumers are reading labels carefully and preferring products with natural and organic ingredients. They wish to avoid artificial preservatives, flavors and colors. This is prompting food manufacturers to replace artificial colors with natural alternatives. Consumers also want vibrant and appetizing food products. Natural colors extracted from plant and insect sources provide a wide range of shades and hues. They impart functionality along with natural appeal. To attract health-conscious consumers, manufacturers are using natural food colors and highlighting clean label positioning. This trend is expected to propel the demand for natural variants over the forecast period.
Porter’s Analysis
Threat of new entrants: The risk of entry of new players is moderate to high as it requires large capital investments and technological expertise to enter this market. However, the demand of natural food colors provides opportunity for new players.
Bargaining power of buyers: The bargaining power of buyers is high as food colors are commonly used products which are available from many established players at competitive prices. Buyers can negotiate for better prices and quality.
Bargaining power of suppliers: The bargaining power of suppliers is moderate as suppliers of natural plant and vegetable extracts used for manufacturing food colors are limited globally. However, suppliers have the bargaining power in terms of availability and pricing of raw materials.
Threat of new substitutes: The threat of substitutes is low as there are very few substitutes available for natural food colors. Artificial colors are used as substitutes but demand is growing for natural variants.
Competitive rivalry: Intense due to large number of established players.
SWOT Analysis
Strength: Wide product portfolio and global presence of key players. Growing health consciousness drives demand for natural variants.
Weakness: High production cost and availability of raw materials impact margins. Quality standards and certifications raise compliance cost.
Opportunity: Growing food & beverages industry boosts demand. Opportunities in Asia Pacific and Middle East & Africa regions.
Threats: Stringent regulations surrounding use levels and labeling. Threat from low-cost artificial color substitutes.
Key Takeaways
The global Natural Food Colors Market Share is expected to witness high growth, exhibiting CAGR of 6.6% over the forecast period, due to increasing health consciousness and clean label trend among consumers. The market size is projected to reach US$ 3.46 Bn by 2030 from US$ 2.05 Bn in 2023.
Regional analysis: North America dominates currently with over 30% share. Asia Pacific is expected to grow at fastest pace owing to rapid growth of food processing industry in countries like China and India. Changing dietary patterns and western influence will drive growth in Asia Pacific region.
Key players operating in the Natural Food Colors market are GNT International B.V., Roha Dyechem Pvt. Ltd., D.D. Williamson & Co., Inc., Kalsec Inc., Chr. Hansen A/S, Archer Daniels Midland Company, Adama Agricultural Solutions Ltd. (LycoRed), Naturex S.A., Sensient Technologies Corporation, and Symrise AG. Key players are focused on new product development and capacity expansion strategies to strengthen their market share.
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