Overall advances will be stimulated by gains in food and beverage processing activity, which is the largest market segment. Growth in personal income levels and consumer spending will also stimulate demand for flavours and fragrances used in cosmetics and toiletries, a market segment historically concentrated in North America and Western Europe, but now seeing rapid advances in developing regions.
The best opportunities for flavours and fragrances will be found in the Asia-Pacific region, which will account for one-third of total value gains between 2009 and 2014.
These and other trends are presented in World Flavours & Fragrances, a new study from The Freedonia Group, a Cleveland-based industry market research firm.
While the US is by far the world’s largest user of flavours and fragrances (accounting for a quarter of world demand in 2009), the fastest growth will occur in developing regions. Advances in Asia, Central and South America, Eastern Europe and the Africa/Mideast region will all outpace the global average.
Industrialisation trends and increases in living standards will fuel demand for flavours and fragrances in these regions’ generally underdeveloped end-user manufacturing industries.
Over the forecast period, the Asia-Pacific region will surpass Western Europe to become the second largest regional consumer of flavours and fragrances behind North America. In particular, China and India will see some of the fastest growth in demand and output, as multinational producers continue to establish subsidiaries in these countries in order to meet local demand.
Food and beverage processing, which accounted for 47% of aggregate demand in 2009, will remain the largest market segment for flavours and fragrances. The expansion of fortified foods (as well as beverages) will provide opportunities, since flavours are often used to cover up the off-tastes of vitamins, minerals, antioxidants and other added ingredients.
Trends towards fast food and other convenience-oriented food options will further boost demand, as these highly processed items often require stronger flavour loadings. The toiletry and cleaner segment will also remain an important market.
Faster growth is expected for applications in cosmetics and toiletries, while demand in the well-established detergent and cleaner industry will be limited by market maturity, even in developing regions such as Eastern Europe.
Source: The Freedonia Group
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