Nutraceuticals every day, keep the doctor away.

Nutraceuticals Market – Overview

nutraceutical is a complex of compounds made from plants or animals – also called a phytonutrient or phytochemical if applied to plants. Essentially these are specified natural foods that contribute to a person’s optimal health and wellbeing.

With the progressive increase in lifestyle diseases, nutraceuticals have emerged as a necessity for consumers, especially in developed markets like the United States. Nutraceuticals are often defined as any food which provides health benefits including prevention or treatment of disease. This definition has now broadened to include functional ingredients such as vitamins, minerals, amino acids, and probiotics, etc.

In 2010, the global nutraceutical market experienced a spike in growth, especially post the recession. The high cost of healthcare especially in the developed countries drove consumers towards dietary supplements, functional food, and beverages, in a bid to remain healthy and avoid treatment costs.

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The U.S. market for nutraceuticals stood at $65 bn in 2015 and Regionally, North America dominated the global nutraceuticals market in 2014 with a share of over 40% in terms of value.

US Consumers are highly health conscious and demand specific ingredients in the nutraceutical products they consume, resulting in a need for customization of nutraceuticals for each target group. Currently, companies in the US are looking to diversify their products and are leaning more and more towards natural nutraceutical ingredients in their product offering, mainly due to the increasing consumer demand for all-natural, non-modified functional ingredients.

Asia Pacific, in the same year, came out as the second-largest market for nutraceuticals.  The increase in demand for functional food and dietary supplement from emerging economies of Asia Pacific will accelerate sales of nutraceuticals in the region.

However, the imminent market saturation of the key products may impact negatively on this market in the years to come.

Most of the Companies in Europe believe that product innovation is the way forward for the nutraceutical industry. Germany, Netherlands, and Sweden have emerged as the key nutraceutical innovation hubs in Europe, while Great Britain and Spain have emerged as key test markets for new products.

The existence of alternative medicine in India and the Indian consumer’s belief in them could provide a secure platform for the nutraceutical industry to be profitable. The Indian consumer’s awareness about standard nutraceutical ingredients such as omega-3 fatty acids is severely limited, and nutraceutical manufacturers need to take up the cause and spread awareness about their products to the Indian consumers.

By revenue, functional food emerged as the largest product segment in the global nutraceuticals market. It held a share of over 32% in the market in 2014. In the last couple of years, the demand for functional food products such as branded wheat flour, fortified food, probiotics, omega fatty acid fortified food, branded ionized salt, and others have surged considerably. The rising interest among people to achieve wellness through diet, the increasing aging population, and the skyrocketing health care costs have fueled demand from the functional food segment.

The Nutraceutical industry is a product of the need for preventative, personalized medicine.  As such it is an industry that regularly tracks and monitors consumer trends, and its products are often direct responses to such demand.

With increasing concerns about side effects and introduction of synthetic additives into foods, consumer demand for natural alternatives increased drastically. The nutraceutical industry responded to such demand by focusing on customization of products which utilizes natural alternatives for established variants. For instance, growing concerns usage of aspartame a well-known sweetener till its role as a possible carcinogen was made known led to the introduction of stevia, a natural sugar alternative. This demand for natural products has taken the West by storm with consumers accepting natural as healthy.

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Nutraceutical manufacturers understand that various cultures have specific requirements for products.

The latest Nutraceutical market is trending towards determining cultural requirements and focusing on them. For instance, in India, omega-3 a traditionally non-vegetarian product has been developed with vegetarian variants obtained from flaxseed oil. In contrast in the Europe, a highly aware market, the focus for omega-3 products which is specific in health functions particularly heart health, a primary cause of European deaths.

The nutraceutical market around the world is witnessing an identity shift in consumer awareness. These products are continuously being evaluated around the world as a sign of prosperity towards preventative medicine. However, with varying global outlooks, the nutraceutical industry has finally come of age in anticipating and understanding requirements geographically.

The global market is currently experiencing a period of growth, post-recession. Even after the effect of the recession fades, the market is likely to remain in a growth phase driven by emerging nutraceutical markets, such as India, China, and Brazil, with China likely to become the world’s largest nutraceutical market by 2030.

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