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The global annatto market size valued at USD 186.14 Million in 2018 and is projected to reach USD 283.62 Million by the end of 2026, exhibiting a CAGR of 5.38% in the forecast period (2019-2026).
Achiote Seeds Extracts or annatto is among the oldest natural dyes known to humans and is extensively utilized by food industries as a natural food grade colorant. The broadening application among both food and non-food sectors is expected to provide future growth opportunities to the annatto market.
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The natural colorants extracted from plant sources are known to offer nutraceutical and nutritional benefits, thus providing value-addition to the finished food products. The market potential for such active ingredients and extracts such as annatto is promising, the organoleptic and nutritional enhancements will resonate favorably with the consumer’s demand for “healthy-indulgence.”
“Favorable Consumption Patterns of Natural Colorants to Aid in Annatto Market Growth”
The global market for annatto is driven primarily due to the strong impetus placed by food manufacturers on the healthier natural alternatives to artificial colorings and synthetic dyes. The future growth trajectory for annatto is promising, given the efforts from ingredients manufacturers to capitalize on optimized, convenient, and personalized offerings that are highly suitable for specific food applications. The gradual decline in the incorporation of artificial colors in new product launches is a testimony of favorable consumption patterns of natural colorants.
“Health Consciousness and Growing Popularity of Clean-label Trends among Consumers”
The annatto market is also benefitted from the increasing awareness about the importance of clean-labeling in assisting sensible purchases is also driving the markets for natural, recognizable and pronounceable ingredients such as annatto.
Ingredient-sourcing and ethical concepts are touted to take clean-label concepts to advanced growth stages. Companies are actively putting in more effort to receive credible clean-label certifications for their ingredients and additives. Natural colorants like annatto will continue to experience greater demands owing to traits like minimally-processed, easy-to-reformulate, non-GMO certified, and safe.
“Oil-soluble Annatto is dominating in Global Marketplace – Wide application spectrum will drive the Future Sales of Annatto irrespective of the Form.”
Globally, the oil-soluble annatto remains a leading type owing to the nature of foods in which it is frequently utilized – dairy products. Annatto has been long utilized for coloring of dairy products, and with the recent trend of “free-from” being established in the dairy sector, the utilization of oil-soluble annatto will be more promising and lucrative for manufacturers.
The fat-soluble annatto finds extensive application in dairy and meat products. The typical orange and orange-red hues are developed due to high amounts of bixin present in oil-soluble annatto.
“The food industry is leading application of Annatto – The dominance is expected to continue amidst robust demand scenario for natural ingredients”
Food processors are increasingly seeking to incorporate ingredients and additives that are Generally Regarded As Safe (GRAS). Annatto extract is in the list of approved colors for the food and feed industries by the European Union(EU) by the U.S. Food and Drug Administration (FDA) and by the World Health Organization (WHO).
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“Europe and North America are leading the current Global Market for Annatto; Asia Pacific Annatto Market is projected to Witness Fastest Growth.”
Annatto is a second-most important colorant behind caramel – the production and consumption trend of annatto remains promising, given the robust demand for natural inputs in food and beverages. Europe and North America will be dominating the global annatto industry over the forecast years. However, the Asia Pacific annatto market will register the fastest compound annual growth rate of 6.26% during 2019-2026.
Western Europe, particularly the U.K, France, Germany, coupled with the U.S., are some of the global hotspots for annatto consumption owing to the robust growth performance of natural colorants. Clean-labelling, consumer-awareness, enabling policy and regulatory scenario, and the number of product launches with natural colorants are some of the attributing growth factors.
North America Market Size (by Value), 2018
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The U.S. is an undisputable leader in the North America Annatto market due to high demand and consumption of ingredients with clean labels. The per-capita consumption of bixin and norbixin carotenoids (active principles of annatto extracts) in the United States remains significant in baked goods, non-alcoholic beverages, coatings, breakfast cereals, and cheese. The number of annatto extracts used must be consistent with the good manufacturing practice.
“Moderately Consolidated Industry Structure in Global Annatto Market”
Givaudan SA, Archer Daniels Midland Company, Sensient Technologies Corporation, and Chr. Hansen Holding A/S are some of the key players in the global annatto market. These key giants are intensively focussing on the new developments, and value addition in annatto extracted colors by availing clean-label, organic, and formulated natural colors to the consumer.
The processed food industry has witnessed a rapid increase in the desire to label food as natural, which is further contributing to the decline in the consumption of synthetic colorants. The global market for annatto is expected to gain momentum from the increase in the R&D activities of key players operating in the market.
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The report provides qualitative and quantitative insights on the Annatto market and detailed analysis of market size and growth rate for all possible segments in the market. The market is segmented by type, application, and geography. Based on type, the global Annatto market is categorized into oil-soluble annatto, water-soluble annatto, and emulsified and solvent-extracted annatto.
Food Industry, natural fabric industry, cosmetic industry, and others are the key applications covered in the study. Geographically, the market is segmented into five major regions, which are North America, Europe, Asia Pacific, South America, and Middle East & Africa. The regions are further categorized into countries.
Fortune Business Insights says that the global annatto market was valued at USD 186.14 Million in 2018 and is projected to reach 283.62 (USD Million Ton) by 2026.
Increasing at a CAGR of 5.38%, the global annatto market will exhibit steady growth in the forecast period (2019-2026).
The oil-soluble annatto segment is expected to be the leading segment in annatto market during the forecast period.
Favorable consumption patterns of natural colorants and the growing popularity of clean-labeling are driving the growth of the annatto market.
Givaudan SA, Archer Daniels Midland Company, Sensient Technologies Corporation, and Chr. Hansen Holding A/S are few of the key players in the annatto market.
Europe is expected to hold the highest market share in the Annatto market in 2018.
The food industry is expected to grow at the fastest pace during the forecast period.
An increase in the investments for natural colorants production, improvisation in the functionality of annatto, and robust demand for naturally-sourced ingredients both in food and non-food application sectors are the key market trends that are driving the growth of the annatto market.