Functional Flours Market Analysis APAC, North America, Europe, Middle East and Africa, South America - US, China, India, Germany, UK - Size and Forecast 2024-2028

Functional Flours Market Size 2024-2028

The functional flours market size is projected to increase by USD 36.14 billion, at a CAGR of 8.5% between 2023 and 2028. The market's growth is driven by several factors, including increased demand for ready-to-eat food from product manufacturers, growing demand for functional flours containing plant-based proteins, and rising consumer demand for gluten-free food products. These elements collectively propel market expansion by catering to convenience, health, and dietary trends. The increased demand for ready-to-eat food from manufacturers highlights a shift towards convenience and quick meal solutions. Simultaneously, the growing demand for functional flours containing plant-based proteins reflects a trend towards healthier and more sustainable food ingredients. Additionally, the rising demand for gluten-free food products underscores the importance of catering to dietary restrictions and preferences.

Market Overview

The market shows an accelerated CAGR during the forecast period.

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Market Dynamics

The market is segmented based on various factors such as agricultural and food products, pre-cooked flours, additive-based flour, and conventional flour. It also encompasses segments related to plant-based diets, plant protein, and specific products like flatbreads, biscuits, pastries, cakes, and cookies. Additionally, considerations like protein quality, gluten allergies, and the use of non-wheat-based flour such as soy flour, rye flour, and oat flour are crucial. The market also caters to the demands of population growth and lifestyle changes, offering products with nutritive value and bioactive properties. Moreover, there's a niche for specialty flours like those derived from cereals, legumes, maize, rice, soy, and wheat.

Key Market Driver 

Growing demand for functional flours containing plant-based proteins is notably driving market growth. Lentils, chickpeas, peas, and edible beans can serve as pulse flours. They are natural sources of plant-based proteins. The demand for pulse flour is increasing due to its numerous benefits. Pulses are low in fat and contain fiber and protein. It requires fewer fertilizers compared to other crops. Owing to these benefits, it made from pulses are widely used to make pasta, extruded snacks, breakfast cereals, and soups. Therefore, manufacturers are keen to add more offerings to their product portfolio. For example, The TradeLink International Group, also known as The BakeRite Company, produces Chickpea Flour-Functional, which has an increased water absorption capacity. 

Moreover, high moisture applications include the makings of dairy, yogurt, pudding, cheese, beverages, nutritional mixes, and smoothies. Low moisture applications include the manufacturing of baked foods, snacks, cereal, bars, pasta, batters, and breading applications. The HOMECRAFT Pulse CT flours contain peas and lentils, which contain high levels of fiber, protein, and starch. These are gluten-free. Hence, they can be used in the preparation of gluten-free baked food products. Hence, numerous health benefits are expected to drive the growth of the market during the period of forecast.

Significant Market Trends 

Growing demand for functional flours in emerging economies is an emerging trend shaping market growth. They are focusing on strategies to expand their business, diversify product offerings, and improve their distribution base. The demand from APAC is fueling the growth of the market. China and India are the major growth contributors. Manufacturers of food products are increasingly using functional flours in their products due to the growing demand from consumers. The increase in the average household income levels and the increase in consumer expenditure on processed foods in APAC will impact the sales of functional flours further.

Further, emerging economies like Brazil, Argentina, and Russia are expected to become key functional flour consumers. Manufacturers who plan to enter the potential markets of Asia, Latin America, the Middle East, and Africa are expected to gain good market share, citing many opportunities to expand the business. Factors like an increase in disposable income and busy lifestyles are expected to drive the growth of the market during the period of forecast.

Major Market Challenge 

The food safety concern is a significant challenge hindering market growth. Consuming raw or undercooked functional flour-based foods, like cookie dough, cold-pressed bars, and frozen pizzas, poses health risks due to potential contamination. Manufacturers, often sourcing raw materials from third-party suppliers, face challenges of microbiological contamination like E. coli and Salmonella. USDA data reveals the presence of pathogens in functional flours, prompting warnings against consuming raw products. Additionally, allergen risks exist, with crops and nuts used in production potentially containing allergens like wheat.

Further, wheat allergies affect many, with common triggers being wheat-based bread and pasta. FDA reports a rising 2% of US adults experiencing food allergens, including gluten intolerance. Regulatory authorities can issue notices and product recalls for safety concerns, impacting brand image. Such recalls can erode consumer trust, with one-sixth of US consumers avoiding brands with a recall history. These safety and quality concerns are poised to hinder market growth during the forecast period.

Market Segmentation

By Type

Fortified functional flour is a cost-effective process that involves enhancing food products with essential micronutrients beyond their natural content. Developed countries have successfully tackled malnutrition by introducing fortified Functional flour food options. Meanwhile, middle-income countries like India are actively addressing malnutrition through coordinated nutrition programs involving central and state governments, as well as global organizations. India, in particular, has embraced food fortification as a sustainable, scientifically proven, and cost-effective intervention. By fortifying wheat flour, staple foods like chapati and roti become carriers of essential nutrients. Iron, folic acid, and other micronutrients are seamlessly integrated into everyday meals, ensuring that even the most basic dishes contribute to public health. As India continues to mitigate malnutrition, regulatory guidelines play a crucial role in shaping the fortification. These dynamics and malnutrition concerns ensure the growth of the market during the forecast period.

By Application

The market share growth by the RTE product segment will be significant during the forecast period. Consumers prefer healthier options as they do not want to compromise on the snacking experience. Considering this trend, manufacturers are using functional flours to make various snacks like extruded snack foods. For example, HOMECRAFT Pulse Flours, a functional flour product from Ingredion, is suitable for a wide range of RTE products such as snacks and pasta.

The RTE products were the largest segment and were valued at USD 20.20 billion in 2018. 

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Further, the demand for functional flour is surging as consumers prioritize breakfast products with high nutritional value, seeking protein, fiber, and energy sources. They scrutinize nutritional labels and prefer products with health claims. Manufacturers respond by incorporating ingredients offering nutritional benefits, such as Ardent Mills' flour line with ancient grains like Sustagrain barley flour, known for its high fiber and beta-glucan content. Combining such flours enhances the nutritional profile of finished products, meeting consumer demand for dietary fiber-rich foods.  The market demand for RTE products that provide health benefits is expected to continue market growth. This will also positively affect the market growth during the forecast period. 

By Region

APAC is estimated to contribute 33% to the growth of the global market during the forecast period

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Technavio's analysts have provided extensive insight into the market forecasting, detailing the regional trends and drivers influencing the market's trajectory throughout the forecast period. In APAC, the market thrives on developments in the food processing sector, driven by factors such as India's liberalized foreign investment rules attracting foreign manufacturers. The region's growing consumer preference for ready-to-eat (RTE) products with healthy ingredients presents lucrative opportunities for engaging in manufacturing. In Japan, the market is fueled by demand from RTE food manufacturers, while Australians favour pulse flours derived from legumes.

In addition, Japanese consumers, known for their health-consciousness, opt for gluten-free and high-fiber functional flours, driving market growth. Therefore, the demand from RTE product manufacturers will also increase. To capitalize on this trend, many marketers are introducing convenience snacks and RTE products with healthy functional flours as ingredients. As consumers in Japan are health-conscious, the demand for RTE products made from gluten-free functional flour is expected to increase. Such factors are expected to drive the regional market growth during the forecast period. 

Company Overview

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 forecasting growth and analysis.

• Key Offering - Archer Daniels Midland Co: The company offers functional flours such as ADMs HarvestEdge flours which contains specialty grains and blends that is used for baking business.
• Key Offering - Associated British Foods Plc: The company offers functional flours which are designed for use in bakery mixes, cereals and energy, and nutritional bars under the brand PAC.

The market growth and forecasting report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including  AGRANA Beteiligungs AG, Archer Daniels Midland Co., Associated British Foods Plc, Dohler GmbH, GEMEF Industries, General Mills Inc., Ingredion Inc., Kerry Group Plc, MGP Ingredients Inc., Olam Group Ltd., Parrish and Heimbecker Ltd., Sudzucker AG, Symrise AG, Tate and Lyle PLC, The Hain Celestial Group Inc., The Scoular Co., Bunge Global SA, Caremoli SpA, Cargill Inc., and Sensient Technologies Corp.

The market analysis and report of 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.

Segment Overview

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

• Application Outlook
  • RTE products
  • Bakery products
  • Soups and sauces
  • Others

• Type Outlook
  • Fortified
  • Specialty
  • Pre-cooked

• Region Outlook
  • North America
    • The U.S.
    • Canada
  • South America
    • Chile
    • Brazil
    • Argentina 
  • Europe
    • U.K.
    • Germany
    • France
    • Rest of Europe
  • APAC
    • China
    • India
  • Middle East & Africa
    • Saudi Arabia
    • South Africa
    • Rest of the Middle East & Africa

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Market Analyst Overview

The market is witnessing a significant surge driven by the rising popularity of plant-based diets and the increasing demand for plant protein. Products like flatbreads, biscuits, pastries, and cakes are incorporating functional flours to enhance their nutritional profile. With consumers becoming more health-conscious, there's a growing interest in cereal-based products fortified with protein-rich non-wheat-based flours such as soy, rye, and oat. Lifestyle changes and a focus on diet and health have spurred demand for functional flours with bioactive properties, particularly those derived from barley.

Moreover, the market is influenced by consumer concerns about obesity, diabetes, and cardiovascular diseases, driving the demand for healthy foods like energy bars and protein bars. Clean labels and fortified flours with vitamins and nutraceuticals are gaining traction, catering to preventive healthcare measures in Western culture. Specialty flours like maize, rice, and soy are increasingly used in products ranging from noodles and pasta to ready-to-eat soups and sauces, reflecting the market's diversity and innovation.

Additionally, the market is witnessing a surge in demand driven by various factors such as consumer interest in health and dietary preferences. With rising concerns about gluten allergies and intolerance, consumers are seeking alternatives like soy flours, rye flours, and oat flours, which offer superior protein quality and nutritive value. These flours, along with composite flours enriched with barley, are gaining traction for their potential benefits in weight management and improving overall health. Additionally, functional flours are being incorporated into a variety of products, including cookies, granola bars, ready-to-eat products and ready-to-eat soups, to cater to the growing trend of on-the-go snacking. With a focus on fortification and customization, the market is also witnessing the emergence of specialty flours enriched with omega-3 fatty acids, calcium, and herbs, meeting diverse consumer preferences and dietary needs.

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What are the Key Data Covered in this Market Research Report?

• CAGR of the market during the forecast period
• Detailed information on factors that will drive the growth of the market between 2024 and 2028
• Precise estimation of the market size and its contribution of the market in focus to the parent market
• Accurate predictions about upcoming trends and changes in consumer behavior
• Growth of the market across APAC, North America, Europe, Middle East and Africa, and South America
• A thorough analysis of the market’s competitive landscape and detailed information about companies
• Comprehensive analysis of factors that will challenge the growth of market companies

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