Industry: Food and Beverages
Published Date: July-2024
Format: PPT*, PDF, EXCEL
Delivery Timelines: Contact Sales
Number of Pages: 160
Report ID: PMRREP18271
The global baking ingredients market is expected to rise from US$18.2 Bn in 2024 to US$28.4 Bn by the end of 2031. The market is anticipated to secure a CAGR of 6.5% during the forecast period from 2024 to 2031.
Key Highlights of the Market
|
Attributes |
Key Insights |
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Baking Ingredients Market Size (2024E) |
US$18.2 Bn |
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Projected Market Value (2031F) |
US$28.4 Bn |
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Forecast Growth Rate (CAGR 2024 to 2031) |
6.5% |
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Historical Growth Rate (CAGR 2019 to 2023) |
5.9% |
Baking ingredients are used in products such as buns, rolls & pies, cakes & pastries, biscuits & cookies, and bread. Baking ingredients are used in bakery items to improve the overall product quality and enhance the shelf-life of the product.
A good quality baking ingredient helps in retaining softness and taste of the baked product. Innovation in baking ingredients is pushing the market forward.
Manufacturers are constantly developing new products to cater to changing consumer preferences, such as plant-based alternatives, gluten-free options, and ingredients with added functional benefits. This innovation is not only meeting consumer demand for diversity and novelty but also addressing concerns such as sustainability and ethical sourcing practices.
With an aim of helping end-users save time in cooking, several vendors in the market have developed long-life pre-packaged food products, bake-off products, freshly finished products, and ready-to-use part-baked pre-packed bakery products such as donuts and tortillas.
Leading market players are making investments in different projects via research and development, in a bid to develop innovative products, and widen their consumer base.
A key trend being observed in the market is soaring demand for organic baking ingredients, which is expected to gain higher traction in the near future. This can be mainly attributed to growth in health-conscious population, and rising awareness about benefits of organic baking ingredients such as sweeteners, oils, and natural flavors.
Emerging economies are increasingly adopting Western baking practices, contributing to market expansion. Additionally, e-commerce platforms have democratized access to specialty ingredients, enabling consumers to explore diverse flavors and products from around the world.
The market saw a surge in demand for baking ingredients due to the increasing popularity of home baking and the proliferation of baking-related television shows and social media content, which sparked renewed interest in baking as a hobby and culinary art form.
The trend was further bolstered by consumers' desire for healthier and more personalized food choices, prompting a shift toward organic, gluten-free, and clean label baking ingredients. The market recorded a CAGR of 5.9% during the historical period.
The market continues to expand as manufacturers innovate to meet the evolving demands of consumers seeking convenience, health-consciousness, and diverse flavor profiles in their baking endeavors.
The baking ingredients market is projected to experience significant growth from 2024 to 2031, building upon its historical trajectory of expansion driven by evolving consumer preferences, technological advancements, and global culinary trends.
Starting from a robust foundation established in previous years, the market is expected to continue its upward trajectory. The market is estimated to exhibit a CAGR of 6.5% during the forecast period.
Growing Demand for Convenience and Packaged Foods
Demand for packaged and convenience food is on the rise, owing to improvement in living standards, and economic conditions in developing as well as developed economies.
Growing need of leisure, hectic lifestyles, and time constraints have led consumers towards adoption of convenience and packaged foods. This has spurred demand for bakery products including pastries, cakes, pizza, and bread, thereby driving demand for baking ingredients.
Surge in away-from-home food expenditure has resulted into an increase in number of retail outlets, convenience stores, coffee shops, in-store bakeries, and artisan bakeries, which provide a variety of innovative baked food products.
Conventional home-cooked food is being replaced by ready-to-eat baked food, especially in developed countries such as North America and Europe, where individuals prefer pocket sandwiches, rolls, and wraps over time consuming food owing to their busy lifestyle. These factors might impact growth of the global baking ingredients market.
Health and Wellness Trends
One of the most impactful drivers in the baking ingredients market today is the increasing emphasis on health and wellness among consumers. This trend encompasses several aspects that are influencing ingredient choices and product development strategies across the industry.
There is a growing demand for baking ingredients that cater to dietary preferences such as gluten-free, organic, non-GMO, and natural formulations.
Consumers are increasingly mindful of the ingredients they use in baking, opting for those perceived as healthier and aligned with their personal health goals. This shift is driven by heightened awareness of nutrition and its impact on overall well-being.
There is a rising interest in reducing sugar and salt content in baked goods, driven by concerns over excessive intake of these ingredients and their potential health implications such as obesity and cardiovascular diseases. As a result, ingredient manufacturers are innovating to offer alternatives that provide sweetness or enhance flavor without compromising taste or texture.
Rising Raw Material Costs
A critical challenge facing the baking ingredients market is the volatility and increasing costs of raw materials. Ingredients such as wheat flour, sugar, dairy products, and oils are essential components in baking, and their prices can fluctuate due to various factors including weather conditions, geopolitical events, and global supply chain disruptions.
Fluctuations in raw material costs can directly impact profit margins for ingredient manufacturers and suppliers. When prices rise unexpectedly, companies may face pressures to either absorb the higher costs or pass them on to consumers, potentially affecting pricing strategies and consumer purchasing behavior.
Moreover, inelastic demand for certain baking ingredients can limit the ability of manufacturers to adjust prices freely, leading to squeezed margins and reduced profitability.
The global nature of ingredient sourcing means that currency fluctuations and trade tariffs can further exacerbate cost pressures. Changes in exchange rates or imposition of tariffs on imported ingredients can disrupt supply chains and increase procurement costs, adding another layer of complexity for industry participants.
Growing Consumer Demand in Alignment with Health and Wellness Trends
There is a growing consumer demand for baking ingredients that align with health and wellness trends. This includes ingredients that are perceived as healthier, such as organic options, gluten-free alternatives, and those with reduced sugar or salt content. Industry participants can seize this opportunity by innovating and developing new formulations that cater to these preferences.
With increasing consumer awareness of sustainability and health, there is a rising demand for organic baking ingredients sourced from sustainable farming practices. Ingredients such as organic flours, sugars, and oils are gaining popularity as consumers seek products that are free from synthetic chemicals and pesticides.
The prevalence of gluten sensitivities and allergies has led to a rising demand for gluten-free baking ingredients. Industry players can innovate by offering a broader range of gluten-free flours, starches, and baking mixes that replicate the texture and taste of traditional baked goods without gluten.
There is also an opportunity to incorporate functional ingredients into baking formulations, such as probiotics, prebiotics, fiber, and vitamins. These ingredients offer added health benefits beyond basic nutrition, appealing to consumers looking for products that support digestive health, immunity, and overall well-being.
Baking Powders & Mixes Command a Dominant Market Share
|
Region |
Revenue Share in 2023 |
|
Baking Powders & Mixes |
24% |
The baking powders & mixes segment continues to lead the product segment. It accounted for over 24% of the global revenue in 2023. Baking powders & mixes offer unparalleled convenience to consumers, particularly home bakers and commercial bakeries alike.
These products typically come pre-mixed with essential ingredients such as flour, leavening, sugar, and sometimes flavorings. This eliminates the need for consumers to measure and mix individual ingredients, saving time and effort in the baking process.
Baking powders & mixes are widely adopted in the commercial baking industry in addition to household use. Bakeries, cafes, restaurants, and foodservice establishments often rely on pre-mixed products to streamline operations, ensure consistent quality across batches, and manage inventory efficiently.
The commercial demand further bolsters the segment's market share, which is predominantly driven by the need for scalable solutions in foodservice settings.
North America is Set to Grow Substantially in the Market
|
Region |
CAGR through 2031 |
|
North America |
6.6% |
There is an increasing consumer preference for convenience foods and ready-to-use baking products in North America. Busier lifestyles and a growing number of dual-income households have led to higher demand for baking ingredients that simplify the baking process.
The ingredients for baking typically include pre-mixed baking mixes, ready-to-bake doughs, and convenient packaging formats that offer ease of preparation without compromising on taste or quality. North America to expand at a CAGR of 6.6% during the forecast period.
The bustling food culture in the countries of North America like Canada, and the US is set to propel demand significantly over the forecast period. This surge is fueled by the region's penchant for on-the-go lifestyles, where convenience plays a pivotal role.
Bakery manufacturers are capitalizing on this one of the key market trends by offering an array of convenient options such as pocket wraps and rolls, catering perfectly to busy consumers seeking easy-to-carry, ready-to-eat solutions.
Health-conscious consumer trends are significantly influencing the baking ingredients market in North America. There is a heightened awareness of the impact of diet on overall health, leading consumers to seek healthier alternatives in their baked goods.
The global market for baking ingredients is highly fragmented, with the presence of many small and large vendors. Competing on factors including distribution, service, reputation, innovation, price, and quality, vendors in the market are focusing on service offerings and product differentiation for gaining a competitive edge.
Mergers and acquisitions are in the range of medium to high in the baking ingredients market. Companies undergoing mergers and acquisitions are seeking strategic partnerships to enhance their product portfolios, expand their market presence, and leverage each other’s strengths.
The competitive nature of the market has led to further encouraging the players to explore synergies, leading to occasional mergers and acquisitions aiming to gain a competitive edge and achieve economies of scale in the market.
Recent Industry Developments
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Attributes |
Details |
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Forecast Period |
2024 to 2031 |
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Historical Data Available for |
2019 to 2023 |
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Market Analysis |
US$ Billion for Value |
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Key Regions Covered |
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Key Countries Covered |
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Key Market Segments Covered |
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Key Companies Profiled |
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Report Coverage |
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Customization & Pricing |
Available upon request |
By Product Type
By Application
By Region
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Growing demand for convenience & packaged foods is a key driver for market growth.
Hostess Brands LLC, Flower Foods Inc, and Nestle S.A. are a few of the prominent players in the market.
Growing consumer demand for baking ingredients that align with health and wellness trends presents a key opportunity.
The market is estimated to value at US$28.4 Bn by the end of 2031.
The market is anticipated to expand a CAGR of 6.5% during the forecast period.
