CLEVELAND, April 18, 2016 /PRNewswire/ -- Global demand for flavors and fragrances -- flavor blends, fragrance blends, essential oils and natural extracts, and aroma chemicals -- is forecast to grow 3.9 percent per year, reaching $26.3 billion in 2020. Increasing consumer demand for more natural products and transparency in labeling, driven in part by health concerns regarding artificial ingredients, will impact demand, particularly in developed countries. These and other trends are presented in World Flavors & Fragrances, a new study from The Freedonia Group, a Cleveland-based industry research firm.
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Flavor blends will continue to be the largest flavor and fragrance segment by value, with gains driven by increasing demand for processed foods in developing regions. "Growth in essential oils and natural extracts will outpace the other major flavor and fragrance segments as consumers around the world increasingly demand products with natural and organic ingredients," notes analyst Christine O'Keefe.
The developed economies of North America, Western Europe, and Japan have been the dominant markets for flavors and fragrances, sustained by large food and beverage and cosmetic and toiletry industries, as well as high levels of consumer spending. Going forward, the maturity of these markets will limit growth in demand for flavors and fragrances, although the growing use of higher value and higher quality products will sustain use of flavor and fragrance blends. Additionally, the increasing popularity of reduced-salt and reduced-sugar prepared foods, which require higher flavor loadings to maintain taste, will boost demand for flavors. The strongest driver of growth in developed countries will be growing consumer interest in natural and organic products, which will drive demand for essential oils and natural extracts.
More robust gains in demand for flavors and fragrances will be seen in the developing economies of the Asia/Pacific and Africa/Mideast regions. In these areas, a growing middle class and increases in personal spending will drive demand for fragrance-containing cosmetics and toiletries, as well as processed foods and carbonated beverages. The increasing popularity of these products will boost demand for fragrance blends, aroma chemicals, and flavor blends. In contrast to more developed regions, aroma chemicals will show healthy growth as local food, beverage, toiletry product, and cleaning product manufacturers continue to utilize them due to their low cost compared to natural alternatives.
About The Freedonia Group – The Freedonia Group, a division of MarketResearch.com, is a leading international industrial research company publishing more than 100 studies annually. Since 1985 we have provided research to customers ranging in size from global conglomerates to one-person consulting firms. More than 90% of the industrial companies in the Fortune 500 use Freedonia Group research to help with their strategic planning. Each study includes product and market analyses and forecasts, in-depth discussions of important industry trends, market share information and profiles of the leading industry players. Reports can be purchased at www.freedoniagroup.com and are also available on www.marketresearch.com and www.profound.com.
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SOURCE The Freedonia Group