The global baking ingredients market, valued at USD 16.6 billion in 2021, is projected to reach USD 22.3 billion by 2026, growing at a CAGR of 6.0% during the forecast period.
Covid-19 Lockdown Spurs Demand for Baking Ingredients
The Covid-19 lockdown has led to a significant increase in the demand for baking ingredients as consumers stranded at home turned to baking. Baking soda, baking powder, cocoa powder, and other condiments witnessed heightened sales. Companies like Cargill, Kerry Group Plc, and retailers reported a notable surge in the sale of these products compared to the same period last year. Additionally, the rise of international cafe and bakery chains has popularized on-the-go food.
Drivers: Growing Consumption of Bakery Products and Confectionery
Bakery products and confectionery are witnessing increased demand due to the rising preference for convenient food options and attractive, tasty, and textured delicacies. Bakery products have become an essential part of consumers’ lives, fueling the demand for various baking ingredients to create rich and flavorful bakery items.
Restraints: Stringent Regulations and International Quality Standards
Baking ingredients undergo rigorous health and safety checks based on governmental regulations in different countries. International bodies like FDA, WHO, CFIA, and others regulate the usage of chemicals and materials in food processing, impacting the baking ingredients market.
Opportunities: Growing Trend of Veganism and Vegetarianism
The growing trend of veganism and vegetarianism is encouraging consumers to shift towards plant-based diets due to environmental, ethical, and health considerations. This presents opportunities for baking ingredient manufacturers to cater to this emerging consumer segment.
Challenges: Health and Wellness Awareness Impacting Bakery Consumption
Rising health concerns among consumers, including diabetes and obesity, have led to a demand for lower fat and sodium content in food products. This poses a challenge for the baking industry, as consumers seek healthier alternatives, impacting the demand for baking ingredients used in high-fat and high-sugar bakery products.
Europe: Leading Market for Baking Ingredients
Europe holds the largest market share for baking ingredients, accounting for 32.4% in 2020. The region’s high consumption of bread and bakery products, produced by various industrial companies, traditional bakeries, and home bakers, contributes to its dominant position.
Key Players in the Baking Ingredients Market
Major participants in the baking ingredients market include Cargill, Archer Daniels Midland Company, Associated British Foods plc, Koninklijke DSM N.V., Kerry Group plc, and AAK AB. Other players like British Bakels, Corbion, IFF, and Dawn Food Products, Inc. also play significant roles in the industry.
