Functional Foods and Beverages Market size is set to grow by USD 141.4 billion from 2024-2028, Product innovations to boost the market growth, Technavio

NEW YORK, June 3, 2024 /PRNewswire/ -- The global functional foods and beverages market size is estimated to grow by USD 141.4 billion from 2024-2028, according to Technavio. The market is estimated to grow at a CAGR of almost 7.45% during the forecast period.

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Key Market Trends Fueling Growth

The functional foods and beverages market is experiencing significant growth due to increasing consumer awareness of their health benefits. These products, including oats, tea, yogurt, and superfruits, are marketed for their ability to reduce the risk of chronic diseases and improve cognitive health, heart health, and weight management.

Functional beverages, such as herbal teas, offer additional benefits like improved immunity, digestion, and energy boost. Examples include Yerba mate, Hibiscus tea, Lemongrass tea, and Chamomile tea, which provide antioxidants, vitamins, and various health advantages. This trend is expected to continue driving the growth of the global functional foods and beverages market. 

The functional foods and beverages market is experiencing significant growth, driven by consumer preferences for healthier options. Daily necessities such as fruits, vegetables, and dairy products are in high demand due to their nutritional benefits. Proteins, probiotics, and fibers are popular functional ingredients.

Fruit and vegetable juices, functional waters, and energy drinks are trending beverage categories. Probiotics and functional snacks are also gaining popularity. Sustainability and eco-friendliness are key considerations for many consumers. The market is expected to continue growing, driven by increasing health awareness and consumer demand for convenient, nutritious options. 

Market Challenges

• The functional foods and beverages market faces skepticism due to concerns over their efficiency and potential health risks. A study by H. Virtanen et al. revealed that excessive energy drink consumption can negatively impact oral glucose tolerance in adolescents. Some popular energy drink ingredients have side effects and exceed recommended harmful chemical levels.
• The mixing of energy-boosting and blood pressure-lowering beverages can cause adverse effects. The Centers for Disease Control and Prevention warns that consuming alcohol with caffeinated energy drinks increases binge drinking risk. Manufacturers must label products with warnings to prevent harmful effects from mixing different types of functional drinks. These factors may hinder market growth during the forecast period.
• The Functional Foods and Beverages market faces several challenges. These include the need for consistent product quality and safety, especially with the increasing demand for organic and natural products. Another challenge is the rising consumer awareness and preference for healthier options, leading to a higher demand for functional ingredients like probiotics, fiber, and antioxidants.
• Additionally, the market is witnessing intense competition, with new players entering the market frequently. Regulations and compliance with various food safety standards also pose a significant challenge. Furthermore, the market is witnessing a shift towards sustainable and eco-friendly packaging solutions. Overall, the market requires continuous innovation and adaptation to meet evolving consumer preferences and regulatory requirements.

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Segment Overview 

1. Product 
• 1.1 Functional foods
• 1.2 Functional beverages
2. Distribution Channel
• 2.1 Offline
• 2.2 Online
3. Geography 
• 3.1 APAC
• 3.2 North America
• 3.3 Europe
• 3.4 Middle East and Africa
• 3.5 South America

1.1 Functional foods- The functional foods and beverages market is experiencing consistent growth due to product and ingredient innovations. Factors such as the aging population, health-conscious adults, and concerned parents are driving demand. However, strict regulations on health claims pose a challenge. Consumers prefer organic functional foods due to their higher nutritional value and simple processing methods. Organic certification bodies ensure compliance with organic conditions and standards. Awareness of the health benefits of functional foods is increasing, fueling market growth.

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Research Analysis

The Functional Foods and Beverages Market encompasses a wide range of products that go beyond basic nutritional value, addressing consumers' needs for preventive healthcare and improved gut health. Dairy products, such as yogurt, play a significant role due to their functional benefits derived from Lactobacilli, proteins, and fatty acids. Functional dairy products are essential value-added food categories, as they contribute to immunity enhancement and digestive function.

The market is influenced by raw ingredient sourcing, farming practices, and processing techniques, adapting to evolving lifestyles and the retail sector's demands. Consumers increasingly seek functional foods and beverages to combat sedentary lifestyles, Type 2 diabetes, and infections, making this market a vital segment in the food & beverage sector.

Market Research Overview

The Functional Foods and Beverages market encompasses products that provide health and nutritional benefits beyond their basic nutritional functions. These include foods and beverages fortified with vitamins, minerals, proteins, and other functional ingredients. The market is driven by increasing consumer awareness and preference for healthier options, as well as the growing trend of convenience and on-the-go consumption.

The market is segmented based on product types, such as dairy products, fruits and vegetables, grains and cereals, and beverages. The market is also influenced by factors such as demographic trends, regulatory policies, and technological advancements. The future outlook for the market is positive, with increasing demand for functional foods and beverages in both developed and emerging markets.

Table of Contents:

1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation

• Product
• Functional Foods
• Functional Beverages
• Distribution Channel
• Offline
• Online
• Geography
• APAC
• North America
• Europe
• Middle East And Africa
• South America

7 Customer Landscape
8 Geographic Landscape
9 Drivers, Challenges, and Trends
10 Company Landscape
11 Company Analysis
12 Appendix

About Technavio

Technavio is a leading global technology research and advisory company. Their research and analysis focuses on emerging market trends and provides actionable insights to help businesses identify market opportunities and develop effective strategies to optimize their market positions.

With over 500 specialized analysts, Technavio's report library consists of more than 17,000 reports and counting, covering 800 technologies, spanning across 50 countries. Their client base consists of enterprises of all sizes, including more than 100 Fortune 500 companies. This growing client base relies on Technavio's comprehensive coverage, extensive research, and actionable market insights to identify opportunities in existing and potential markets and assess their competitive positions within changing market scenarios.

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SOURCE Technavio