Food additives are used to enhance the taste, color, texture of food, same time maintaining the freshness and nutritional content. The food additives market in South America is expected to be USD xx million by 2022; growing at a CAGR of x.x% from 2017 and 2022. The population growth coupled higher food production and demand is the major factors leading to high requirement of food additives applications.
In South America, growing urbanization and changing lifestyles due to globalization are driving demand for convenience and packaged foods. The scenario in turn is helping the food additives industry to grow as food additives are an important component of these kinds of foods.
Additives are mainly used to maintain and improve safety of the packaged food and to enhance the nutritional value of the food. Expanding processed food market due to increasing disposable incomes of the burgeoning middle class is the major drivers for food additives market growth in the region. The growth is further supported by growing urbanization of the rural population and rising organized market in rural segments of developing economies of Latin America. Food additive market is also supported by the fact that additives are applied as a way of curbing risk of wastage of food products. However, the consumer preference for natural alternatives, demand for clean label products and stringent regulations hinders the market growth.
The food additives market is segmented by type viz. Preservatives, Food flavors and Flavor enhancers, Antioxidants, Sweeteners, Emulsifiers, Anti Caking agents, Enzymes, Fat replacers, Acidulants and others (texturizer, shelf life stabilizers, etc). The largest segment is Flavors and flavor enhancers market which recorded value wise, followed by Hydrocolloids which function as texturizer, thickening, stabilizing and gelling agents. The fastest growing segment is the Sweetener type which is seen as an alternative to sugar used in food and beverages. The major applications pertaining food additives are in Fruits & vegetables, Bakery & Confectionary, Dairy & Frozen products, Oils & Fats, Savory snacks, Meat poultry & Sea food products.
South America provides greater scope of growth due to its highly untapped markets; Brazil and Argentina are the major consumers of food additives in the region. The major foreign players in the market are Cargill, Tate & Lyle, Palsgaard, DuPont, DSM, Givaudan, Brenntag, Novozymes, International Flavors and Fragrances, etc. Some of the regional companies manufacturing food additives in the region are Associated British Foods, Arraiz Agronegocios, Cordis S.A., CSB-System Latinoamerica, Eurochem S.A., Assuan investment export import ltd, Danone etc.
The strategies being adopted in the Food additives industry is in the Innovation category under the development of natural food additives and functional food ingredients to meet the customer demand. Many foreign companies are entering the emerging economies of the region through partnerships as they see the developed countries as matured markets in terms of revenue growth. Companies need to undertake ‘clean label’ solutions to meet the safety standards to cater to the regional food consumption. Growing consumer awareness on the benefits of natural additives and functional food additives would help capture the new markets in the region. However, General standard for Food Additives (GSFA) needs a wider acceptance for improved International Trade which would help the industry in South America.