Nutraceutical Industry Statistics and Trends

Nutraceuticals are defined as a food product that contains a health-giving additive. By consuming the food product, an individual would therefore receive some sort of medical benefit.

The term “nutraceutical” comes from a combination of the words “nutrient” and “pharmaceutical.” It was first used in 1989 and has now developed into a thriving industry.

How nutraceuticals are categorized depends upon the source of the health-giving additives that are found in the product. Natural sources, pharmaceutical sources, and even chemical sources are all possible. The segments within this industry include medicinal foods, functional foods, functional beverages, and dietary supplements.

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Important Nutraceutical Industry Statistics

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#1

The global nutraceutical market is forecast to reach a total value of $285 billion by the year 2021. In 2016, the total value of the market was $198.7 million. If this can be achieved, then the industry would experience an average CAGR of 7.5%. (Research and Markets)

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#2

Functional beverages are expected to continue to lead the industry. In 2016, this segment of the nutraceutical industry was valued at $71.5 billion. In 2021, the segment is expected to achieve a value of $105.5 billion, which would be a CAGR of 8.1%. (Research and Markets)

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#3

Functional foods continue to be a strong part of the nutraceutical industry as well. In 2016, it brought in $64.6 billion in revenues. In 2021, this segment of the industry is forecast to achieve $92.3 billion in revenues. (Research and Markets)

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#4

Private label vitamins account for more than $310 million in sales within the U.S. market each year. For a branded multivitamin, Centrum Silver is the most popular product sold in the U.S., accounting for $181.3 million in 2016. Bausch and Lomb Preservision and Airborne are the only two other multivitamin brands to achieve 9 figures in sales in 2016. (Statista)

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#5

Centrum is the leading multivitamin vendor in the United States. Produced by Pfizer, when all the Centrum brands are combined, they generated over $275 million in sales annually. (Statista)

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#6

47% of the population in Japan is believed to participate in the nutraceutical industry on a regular basis. (Mordor Intelligence)

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#7

60% of people under the age of 40 are interested in the nutraceutical industry’s products as a way to increase their protein intake levels. (Mordor Intelligence)

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#8

The average consumer above the age of 60 is unware of the health benefits that can be provided through functional foods and functional beverages. (Mordor Intelligence)

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#9

75% of the geographic distribution for mergers and acquisitions within the nutraceuticals industry occurs in North America. Another 16% occur in Europe. (Bourne Partners)

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#10

70% of the global population of 1 billion people over the age of 60 in 2020 will live in regions where brands have pushed age-defying and anti-aging products for higher industry visibility. (Bourne Partners)

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#11

The global market for nutraceuticals may reach more than $310 billion by 2021 because of increases in healthcare costs. Higher medical costs often translate to higher rates of self-diagnosis, more preventative care, and self-medicating. (Bourne Partners)

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#12

The heart health sector of the nutraceuticals industry is projected to achieve $15.2 billion in revenues by the end of 2018. This was driven by a CAGR of 15% in the Asia-Pacific region. (Bourne Partners)

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#13

The global market for probiotics is expected to reach more than $39 billion by the end of 2018, with increased availability in yogurt, dietary supplements, and other functional foods. (Bourne Partners)

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#14

By 2030, 13% of the global population is expected to be above the age of 65. As disposable income rates continue to rise, especially in the Asia-Pacific region, the nutraceutical industry will take advantage of the opportunity to expand their market share in key markets. (Bourne Partners)

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#15

In the United States, 74% of Americans stated that the term “natural” to them equates to a healthier food choice. That means the ingredients within the nutraceutical industry are expected to reach more than $30 billion in sales by 2021. (Bourne Partners)

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#16

Between 2012-2014, the number of adults who consumed nutraceutical products rose from 72% to 78%. At the same time, adults who were taking a vitamin or a mineral supplement declined from 72% to 64%. (Gallup)

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#17

In 2017, the U.S. market held a 39% share of revenues generated by the nutraceutical industry, making it the clear leader globally in overall sales. (EU-Japan Center)

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#18

In 2000, the European investment into new nutraceutical products was 0.8%. In 2014, investment rates reached 1% of total revenues for the first time. (EU-Japan Center)

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#19

The nutraceutical market in Europe was valued at $35 billion in 2010. It is expected to grow faster (6.5% annually) than the U.S. market (5.8% annually). (EU-Japan Center)

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#20

Although India represents just 2% of the 24% of the market share the nutraceutical industry enjoys in the Asia-Pacific region, it has one of the fastest growth rates in the world. Between 2006-2012, the average annualized growth rate in India was 19.1%. (EU-Japan Center)

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#21

Functional food ingredients are expected to reach a total value of $2.5 billion by 2020. North America is expected to have the largest share of this segment, though rising opportunities in this segment for China, Brazil, and Italy could shift the revenue demographics somewhat. (EU-Japan Center)

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#22

The phytonutrients market for the nutraceutical industry is expected to grow at an annualized rate of 7.2% for its next 5-year forecast period. This would have it reach a total value of $4.6 billion. (EU-Japan Center)

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#23

Prebiotic ingredients are expected to have a total market value of $5.5 billion globally, with an expanding market found in animal feed for the industry. (EU-Japan Center)

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#24

Just 1% of the direct employment opportunities that are found within the nutraceutical industry involve research and development. In the pharmaceutical industry, 1 out of 3 direct employment opportunities involve research and development. (EU-Japan Center)

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#25

The most popular functional foods that are sold by the nutraceutical industry are yogurts. Over 76% of consumers purchase yogurt products. Breakfast cereals come in second, at 75.9%, while butters and spreads account for 74% of consumer habits. (EU-Japan Center)

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#26

1 in 3 people regularly consume a functional food product that contains probiotics. 1 in 5 people also consume functional beverages that contain probiotics on a regular basis. (EU-Japan Center)

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#27

4 out 5 consumers in the developed world believe that they receive all their daily nutritional requirements from their regular eating habits, even though 43% of consumers are interested in the potential health benefits of functional foods. (EU-Japan Center)

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#28

45% of consumers in the developed world say that they “never” or “rarely” consume functional foods or beverages because they feel that their normal diet will sufficiently meet their dietary needs. (EU-Japan Center)

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#29

Pharmacies have the largest retail share of nutraceutical sales globally, accounting for 39% of all revenues. They are followed by grocery stores, which have a 31% market share. Online sales or mail order sales make up just 6% of total industry revenues. (EU-Japan Center)

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#30

In the United States, nutraceuticals for pets is expected to contribute another $1.6 billion in revenues annually. About half of those revenues would come from horse owners. (Packaged Facts)

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#31

Joint-health support is the largest segment of the pet nutraceutical market, accounting for 39% of the products that are sold by the industry annually. (TechNavio)

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#32

With the introduction of nutraceuticals to the general population in India, undernourishment rates in the nation have reduced from 17% in 2008 to 15% in 2016. (World Food India)

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#33

Dietary supplements are expected to make up 22% of the nutraceutical market. Functional beverages are expected to continue leading, through 2019, market shares, at 48%. (TechNavio)

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#34

Cargill is the leading brand of nutraceutical functional foods in India, accounting for 20% of total sales. Amway is the leading brand in India for dietary supplements, with a 12% market share. (World Food India)

Forecast

Nutraceutical Industry Trends

In the developing world, the mortality rate reaches nearly 40% in some nations because of nutrition-related issues. This shows that the nutraceutical industry is not only important, with an enormous level of potential growth awaiting it. Certain nations, such as India, may see growth levels within this industry reach 16% annually over the next 5-year period.
 
The European market is mature for the nutraceutical industry, while the U.S. market has reach an advanced level in terms of market variety, branding, and product penetration.
 
Since 2010, this industry has experienced strong levels of global growth. Part of this was fueled by consumers returning to the industry after cutting ties to it in 2007-2009 as a personal cost-savings effort. Assuming products remain affordable for the industries mature markets and access improves in the developing world, each segment should experience continued strong growth through its next 5-year and 10-year forecast periods.
 
In 2014, US healthcare spending reached $3 trillion. That impacts household budgets negatively. These families will search for affordable alternatives that keep them out of the doctor’s office. One of the best answers they will find are the functional products offered by the nutraceutical industry.

Nutraceutical Market Growth Driven by Health Conscious Consumers

The global nutraceuticals market will continue to grow at a CAGR of 7.3% through 2021, according to Transparency Market Research. The sector was last valued at $182.6 billion in 2015 and, given these projections, will reach $278.95 billion within the next four years.
Much of this growth is due to the continuous strides made by the health-conscious consumer toward functional foods and beverages, dietary supplements and personal care. In the wake of nutraceutical market growth rides the implementation of provisions stemming from the Food Safety Modernization Act (FSMA). To meet these regulations, nutraceutical companies will face various manufacturing challenges. In the near term, they can adjust to the burdens of these regulatory changes to capitalize on the opportunity presented by growing market demand.
In addition to regulatory challenges, growing consumer demand for clean label products, responsibly sourced ingredients, sustainable packaging and pressures to extend shelf life are factors that can pile on to the supply chain challenges of nutraceutical manufacturers. However, these companies can lean on suppliers to guide them in making the right packaging equipment and material selections to satisfy evolving consumer desires and keep their manufacturing operations efficient and profitable.

Regulatory Matters

Many food and beverage manufacturers have already taken measures to comply with the FSMA provisions applicable to their specific industries. Thanks to design modifications by packaging OEMs, these companies can continue to implement solutions that quicken sanitation processes. According to a 2016 Food Safety Modernization Update report by PMMI, The Association for Packaging and Processing Technologies, OEMs are seeking to improve sanitary designs, increase the use of stainless steel, reduce cleaning times from 30 minutes to five minutes and implement more tool-less designs in order to satisfy the FSMA requirements. For example, if a food and beverage manufacturer is producing a gluten-free and gluten containing product in the same facility, they must consider the cleanability needs to prevent cross-contamination. To reduce risks, nutraceutical companies should utilize good manufacturing practices (GMP) and designate hygienic zoning programs to differentiate between unprocessed and processed food locations.
Since FSMA aims to foster more effective prevention of and planning for contamination instances, advanced track-and-trace mechanisms are also necessary for nutraceutical manufacturers to track issues and remove compromised product from shelves quickly. Data collection and IT improvements are also at the forefront of OEM equipment plans. New interfaces and Supervisory Control and Data Acquisition (SCADA) systems to facilitate efficient track-and-trace activities play an important role in the FSMA updates. Nutraceutical food and beverage processors are no exception to these trends and must collectively invest in these technologies in order to stay up to date. Companies can evaluate risks through monitoring, testing and archiving their safety procedures and then producing these journals to the Food and Drug Administration (FDA) to demonstrate that their manufacturing processes are clean and safe. An OEM’s attention to cleanability as well as the manufacturer’s ability to journal and demonstrate hygienic workspaces will help prevent regulatory matters from impeding operations for members of the nutraceutical manufacturing industry.

Clean Labels and Corporate Social Responsibility Work in Tandem

The consumer demand for clean label products continues to rise. In fact, 37% of U.S. consumers search for recognizable ingredients when making a purchase and reject ingredients that are unrecognizable. However, there is also a growing concern for corporate social responsibility (CSR), specifically how and where to procure ingredients for different nutraceutical products and functional foods. No nutraceutical manufacturer wants to source ingredients through means that consumers will find unpalatable. For example, when palm oil extraction accidents impacted wildlife and the environment, widespread coverage created an unfavorable image for brands that went against the wholesome, good-for-you product promises they offered.
With nutraceuticals being a key industry for consumers seeking health-giving and medicinally beneficial ingredients, nutraceutical manufacturers have to consider the source of these ingredients. If at all possible, sourcing non-GMO, gluten-free, natural and organic ingredients locally can also be an asset to a brand looking to entice health-driven consumers. In fact, according to PMMI’s 2017 Trends in Food Processing Operations report , one food processing leader cited, “the present value in America is knowing where our food ingredients come from; it requires tremendous transparency.”

Sustainable Packaging and Extending Shelf-Life

Coupled with the consumer demand for organizations demonstrating a strong sense of CSR is the need for sustainability and minimizing the carbon footprint of a product. While new solutions for sustainable packaging are currently on the market, the challenge lies with how to properly extend shelf-life while still adhering to the consumer dislike for additives and preservatives. For example, recyclable, biodegradable and possibly paper-based pouches are often preferred. In fact, in PMMI’s 2016 Food Packaging Trends and Advances report 80% of food company leaders responded that they were interested in this type of sustainable packaging, but need assurance that they provide an appropriate level of barrier protection for perishables and acceptable shelf-life. On the other hand, flexible pouches afford opportunities for lightweighting, conserving space—and therefore fuel—in transportation along the supply chain while providing a wide range of barrier protections that prevent degradation from exposure to air, UV light and other contaminants.
Advancements in flexible packaging have even reinvigorated interest in existing technologies like High Pressure Processing (HPP), which can provide additive-free products like nutraceuticals a longer-shelf life. HPP is the practice of using very intense pressure in order to render pathogens ineffective in food and beverages, such as nutraceuticals and juices. One of the major benefits of using HPP for nutraceutical processors is its potential to extend the shelf-life by three to four times in some instances without using chemical additives. For instance, a healthy juice that would typically have a three-day shelf life can now extend to anywhere between nine and 12 days. Additionally, HPP protects the flavor properties of natural ingredients that the chemical additives and heat pasteurization commonly used in processing can alter. To assist in the advancement of this technology and formalize industry best practices, PMMI convened the Cold Pressure Council (CP Council).

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