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The functional additives market size is estimated to grow by USD 1.29 billion at a CAGR of 5.49% between 2023 and 2028. Market expansion relies on various factors, including the increasing online and internet sales of functional additives, heightened demand for such additives from the pharmaceutical sector, and growing interest in functional additives within the packaging industry. These elements collectively drive market growth, reflecting evolving consumer behavior and industry trends. The rise in online and internet sales of functional additives underscores the importance of digital platforms in facilitating product accessibility and distribution. Simultaneously, the growing demand for functional additives in the pharmaceutical industry highlights the critical role of additives in enhancing drug efficacy and safety. Additionally, the increasing demand for functional additives in the packaging sector signifies the importance of additives in ensuring product protection and preservation. Thus, the interplay of these factors delineates the landscape for the anticipated expansion of the market catering to functional additives across various industries. It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2018 - 2022.
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The foods and beverages segment is estimated to witness significant growth during the forecast period. They are used in the food sector to improve the packaging performance, shelf life, and processability of the products. Additionally, the food sector is often under scrutiny to comply with regulations set by the US Food and Drug Administration (FDA) and the European Union. They even reaches under the indirect additives category of the US FDA, as various additives may encounter food as a part of either packaging or processing equipment. However, they are not intended to be added directly to food products.
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The foods and beverages segment was the largest segment and was valued at USD 1.38 billion in 2018. In the beverages sector, bottles and cans are expected to account for a large share of the global beverage packaging market. The packaging segment includes plastic, glass, metal, and paperboard. Alcoholic beverages, non-alcoholic beverages, and dairy products are the key application areas of the global beverage packaging market. The growing population and increasing income levels in developing economies, such as China and India, are expected to drive the market during the forecast period.
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APAC is estimated to contribute 61% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. The APAC region is anticipated to witness a high demand due to an upsurge in the consumption of foods and beverages, pharmaceuticals, and consumer goods. The increasing population in India and China is expected to drive the demand for flexible packaging, especially for foods and beverages.
Moreover, investments in the packaging industry, especially in China, India, Japan, Indonesia, and Thailand, are expected to drive the market in the region. Some established players are likely to enter strategic alliances with the local players of APAC to consolidate the market share; hence, the regional market is witnessed to grow positively during this forecast period.
The market caters to diverse industries like personal care and cosmetics and healthcare and pharmaceuticals, offering solutions such as UV protection, antioxidants, and antimicrobial agents. With a focus on sustainability, there's a growing demand for bio-based additives and compostable packaging, aligning with consumer preferences and stringent regulations. Innovations in blowing agents and impact modifiers enhance packaging performance, while smart packaging additives introduce features like temperature monitoring and tamper-evident characteristics. This market thrives on providing solutions that optimize polyethylene (PE) and polyethylene terephthalate (PET) formulations, ensuring both functionality and environmental responsibility in the realm of packaging materials. The personal care and cosmetics industry integrates anti block agents and bio based additives, along with tamper evident features, to enhance product safety and integrity, while the healthcare and pharmaceuticals industry utilizes antimicrobial agents to address skin health concerns and maintain product quality.
Rising online and internet sales of functional additives is the key factor driving market growth. The evolution of the global market for functional additives in retail packaging has been driven by the increasing popularity of Internet trading and e-shopping, as well as the growing demand for doorstep delivery. The rise in the consumption of food and beverages owing to online internet sales is expected to drive the food packaging market. This will drive the demand for functional additives.
Moreover, the increasing purchasing power parity, dual-income families, and a decrease in domestic slack time in APAC are expected to drive the demand for food, beverages, and cosmetics. With the increasing number of customer-friendly e-commerce applications and portals, the online retail trade will be a major driver, and thus, the market will witness growth in the market during the forecast period.
Growing demand for reverse logistics in packaging is the primary trend shaping market growth. The packaging for foods is typically done with plastic wrappers or containers. The non-biodegradable nature of plastics increases sustainability concerns. Reverse logistics is a method by which the materials flow back from customers to the manufacturers for reuse. The reverse movement of material in the supply chain system for cost reduction and profitability and to support sustainability is expected to drive the global packaging market for food and beverages.
Furthermore, the PET bottles are either remanufactured or used as regrind in PET to produce new bottles. In the US, the government supports programs such as the California Redemption Value (CRV) program. This is expected to drive the demand for functional additives, owing to their use in packaging applications. Hence, due to such advancements and supporting programs, the market is expected to witness growth during this forecast period.
Volatile raw material prices of functional additives is a challenge that affects market growth. Crude oil contains a number of chemicals that are used in the production of functional additives. One of the main suppliers of raw materials, such as phenols and aromatic amines, is the oil and gas sector. These raw materials are mainly produced from petroleum fraction downstream products.
Moreover, fluxes in the prices of crude oil have a severe effect on the prices of raw materials, which affects the costs of the product. The fluctuating price and non-availability of raw materials could also have an adverse effect on the cost and operations of market players, which can impede the growth of the market during the forecast period.
The market research report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Market Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
The research report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The market research report provides comprehensive data (region wise segment analysis), with forecasts and estimates in "USD Billion" for the period 2024 to 2028, as well as historical data from 2018 to 2022 for the following segments
The market focuses on addressing water scarcity challenges by leveraging innovative technologies for desalination. While the market primarily targets plastic packaging and healthcare and pharmaceuticals industries, it also caters to consumers concerned about plastic waste and carbon emissions. Through advancements like anti-block agents and clarifying agents, this market ensures efficient coating selection and surface preparation for plastic packaging, minimizing issues like pinholes and coating failures. Additionally, it offers sustainable packaging additives and biodegradable materials, meeting demands for greener options and contributing to efforts in reducing plastic waste. With a focus on protective solutions and active packaging additives, it aims to enhance barrier protection and aesthetic improvements, catering to various sectors including e-commerce and combatting food waste with novel packaging technologies.
Furthermore, the market is driven by advancements in anti-block agents and brightness agents to enhance water purity in challenging subsea environments. Innovations in synthetic formulations and chemical compositions ensure substrate compatibility while addressing cathodic reactions and corrosion concerns. Applications span across industries, including personal care and cosmetics, where antimicrobial and anti-bacterial agents are crucial, and healthcare and pharmaceuticals, requiring stringent purity standards. Metalized coatings and organic liquid coatings are deployed for efficient desalination systems, while packaging additives like slip additives and bio-based additives support sustainability efforts in the packaging industry. With a focus on recyclable materials and aesthetic enhancing additives, the market caters to emerging trends in e-commerce and flexible packaging, ensuring water quality preservation amidst evolving consumer demands.
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Market Scope |
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Report Coverage |
Details |
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Page number |
188 |
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Base year |
2023 |
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Historic period |
2018 - 2022 |
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Forecast period |
2024-2028 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 5.49% |
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Market growth 2024-2028 |
USD 1.29 billion |
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Market structure |
Fragmented |
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YoY growth 2023-2024(%) |
4.66 |
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Regional analysis |
APAC, North America, Europe, South America, and Middle East and Africa |
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Performing market contribution |
APAC at 61% |
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Key countries |
US, China, India, Japan, and Germany |
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Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
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Key companies profiled |
ADEKA Corp., Akzo Nobel NV, Altana AG, Amcor Plc, Arkema Group, Avient Corp., BASF SE, Clariant International Ltd., Dow Chemical Co., DuPont de Nemours Inc., Dynea AS, Evonik Industries AG, Lanxess AG, Milliken and Co., RPM International Inc., Sabo Spa, SI Group Inc., Solvay SA, Songwon Industrial Co. Ltd., and The Sherwin Williams Co. |
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Market dynamics |
Parent market analysis, Market Forecasting, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for the market forecast period. |
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Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements.
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Application
7 Market Segmentation by Type
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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