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The global spices and seasonings market was valued at USD 17.75 billion in 2021 and is projected to grow from USD 18.47 billion in 2022 to USD 25.42 billion by 2029, exhibiting a CAGR of 4.67% during the forecast period. The global COVID-19 pandemic has been unprecedented and staggering, with Spices and Seasonings experiencing lower-than-anticipated demand across all regions compared to pre-pandemic levels. Based on our analysis, the global market exhibited a lower growth of 3.14% in 2020 compared to 2019. CAGR increase is attributable to this market’s high demand and growth, returning to pre-pandemic levels once the pandemic is over.
Spices and Seasonings are the ingredients used to give food and beverage products aroma, flavor, preservation, and color. These products are derived from various plant parts, including flowers, barks, fruits, buds, seeds, leaves, roots, and plant tops. Spices are used in various foods and beverages, including healthy raw materials such as turmeric and pepper. The global demand for such healthy spices indicates the market's upward trajectory.
The market is primarily driven by a few factors, such as the rising popularity of ethnic cuisines. It is driving the demand for spice blends and new spices. Spices are often used by the vegan masses as meat substitutes. They often mimic the taste of meat. It is creating several opportunities for the spices and seasonings market growth. Also, the increasing demand for turmeric, which is sold as Curcuma in developed regions such as Europe, would aid the growth of this market.
Disruption in Supply Chain and Trade amid COVID-19 Pandemic to Impact the Market Growth
The pandemic outbreak has resulted in the market's slowdown due to various economic, political, and social changes. The crisis significantly impacted the world's spices sector, with its value chain stretching from the main production hubs in developing countries to the global spice trade network. Following the implementation of lockdown measures by national governments to halt the spread of the virus, there have been labor shortages caused by workforce migration. The border closure of China and India caused the fall in the price of some spices. For example, the price of cardamom in India fell by 50%, and the price of pepper in Vietnam fell by about 10% in 2020.
The leading market players witnessed a slight decline in their Spices and Seasonings segment's revenue, generated during 2020. For instance, McCormick & Company Inc. is one of the largest spice companies in the world; the company's flavor solutions segment saw a 3.5% decrease in sales in 2020 compared to 2019. The demand from the restaurant and branded foodservice customers was lower due to the COVID-19 disruption, which drove the decline in sales. As the spice industry prepares to overcome the post-coronavirus problem, opportunities such as sustainable spices and food safety measures are expected to open up for the spice industry to get back to a normal pace.
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Proliferating Demand for Sustainably Sourced Spices to Augment Growth
Customers generally look for more natural and healthier products, including Spices and Seasonings. They are now more conscious and curious about products' origins and production process. Consumers in developed countries are embracing sustainable sourcing to protect the security of supply chains, the quality of products, and, most importantly, the livelihoods of the people who grow the spices. As the sustainability certification of spices is becoming more mainstream, the market shares of sustainably produced spices and herbs are increasing in different regions. According to FLOCERT, in Europe, there were around 146 Fairtrade-certified companies in the sector of herbs and spices in 2021. Furthermore, consumers are opting for healthful indulgence to provide taste and beneficial traits such as superior nutritional profiles organic and non-GMO retail positioning. This trend is expected to significantly boost spice and seasoning sales in both developed and developing markets.
Rising Veganism and Vegetarianism Trend to Favor Market Growth
Vegetarianism and veganism are part of a global trend that is rapidly expanding. The vegan population in the U.S. and the U.K. has grown significantly. Many spices previously used in the meat processing industry are now utilized in vegetarian alternatives. This trend contributes to the growth in spice demand. Plant-based diets are becoming increasingly popular around the world. The companies are focusing on new product launches, specifically for the vegan and vegetarian population, to take advantage of this new trend. For instance, in January 2022, Watson's Seasoning Blends, a Los Angeles-based female and minority-operated brand, released a new line of vegan gourmet spice blends that make it easy to make delectable plant-based meals. With the rise of plant-based alternatives and only a slight decrease in meat consumption, spice and herb producers have an opportunity to create more creative flavor seasoning combinations. Additionally, the rising use of spices by vegan masses as meat substitutes has positively aided the global spices and seasonings market growth.
Investment in Digitalization of Spices Supply Chain to Boost Market Growth
Digitalization is becoming more important in the procurement of spices and herbs. Sensors, digital tools, and online activities are among the new trends to make the entire supply chain more transparent and sustainable. Many farmers worldwide utilize digital technologies such as smartphones, sensors, drones, and satellites. These technologies offer a variety of solutions for spice and herb producers, including remote measurement of soil conditions, improved water management, pest and disease emergence forecasts, and crop monitoring. In April 2021, the Netherlands Space Office funded the SpiceUp project on digital agriculture. The project combines advanced satellite technology, information technology, and the internet to assist black pepper producers in Indonesia. It also developed the SpiceUp smartphone application to support different actors in the black and white pepper chain. Thus, the increasing digitalization projects for the production of spices & herbs in various emerging economies are expected to boost the global market size in the upcoming years.
Counterfeiting of Spice Products to Impede Market Growth
Spice adulteration is mostly attributed to rising demand for exotic herbs and spices and a supply constraint. Spices have become more vulnerable to adulteration, whether planned or unintentional, since the international spice trade has grown tremendously. Deliberate adulteration is usually motivated by a desire to maximize profit margins. For instance, in December 2020, Police in India's northern state of Uttar Pradesh raided a factory that made fake spices out of donkey dung, acid, and other spurious ingredients. Spices and herbs can be swapped with other plants or artificial colors, and unlisted flavoring can be added. It's also possible that the geographical origins have been altered. For example, Asian chilies are sold under Mexican names such as chipotle or jalapeño. Mexican national symbols, such as the mariachi hat, are frequently featured on the packaging. Food fraud is a serious problem in the spice and herb industry, which is expected to hamper the market growth in the forthcoming years.
Pepper to be Leading Type Owing to Health Benefits Associated with its Consumption
Pepper is expected to account for a large segment of the global spice and seasoning market, and the segment is expected to maintain its lead throughout the forecast period. The growing popularity of the flavor that pepper provides and rising consumer awareness of its health benefits are driving the segment growth. The increasing emphasis of pepper-producing countries on digitalization is expected to further support growth. For instance, Olam International produces black pepper in Vietnam and Brazil using an integrated smart agriculture system. Automatic drip irrigation, weather stations, and real-time monitoring are all part of this system. The benefits of such software solutions will be multi-fold. It will ensure real-time monitoring can ensure the protection of products, which is further predicted to contribute to the segment's growth.
The spicy trend in several countries provides a growth avenue for different chili powder blends. Chilies are becoming popular among consumers as they enhance the flavor, zest, heat, warmth and bite, and the color of prepared foods. Consumer's continued affinity towards hot and spicy food is expected to boost the segment's growth in the forecast period.
Sales of immune-boosting spices such as turmeric, ginger, and garlic increased significantly in past years due to the pandemic. The growing demand for low-sugar, low-salt foods and the ever-increasing popularity of herbal drinks such as herbal tea and infusions have prompted the development of specific spices such as turmeric, ginger, cinnamon, and others.
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Snacks & Convenience Food to be the Leading Application Segment Owing to Rising Popularity of Savory Flavored Snacks
Snacks and convenience foods are the most important commodities in the spice and seasoning trade. The growing popularity of savory flavored snacks is propelling the segment's expansion. Blending companies' services have expanded to include the preparation of spices and other ingredients such as salt, garlic powder, lemon, dehydrated vegetables, and other flavorings. The product customization provided by spice manufacturers can assist the segment in maintaining its largest share throughout the forecast period.
The bakery and confectionery segment is anticipated to see growth as they use Spices and Seasonings to provide a variety of products. The demand for spices such as cinnamon, allspice, ginger, and nutmeg surged during Easter as people were staying home due to COVID-19. Spice-mixing specialists are increasingly assisting the bakery and confectionery industries by producing ready-to-use spice mixtures, which will likely boost growth in upcoming years.
The frozen foods segment is expected to witness substantial growth. Herbs are classified as food preservatives and shelf life-extending ingredients due to tropical climates in several countries. The companies in the tropical region are launching seasonings to bring the experience of gourmet food to more people. In October 2021, Orika, a premium gourmet spice brand from India, has launched the sprinkler's range of herbs and seasonings. The products are made from premium ingredients to add rich aroma and flavor to various recipes.
North America Spices and Seasonings Market Size, 2021 (USD Billion)
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The market is categorized into North America, Europe, Asia Pacific, South America, and the Middle East & Africa in terms of geography.
North America dominated the world market and stood at USD 7.48 billion in 2021. North America has been one of the major markets for Spices and Seasonings as new consuming habits change how consumers think about herbs. Also, new industries are sprouting up in the U.S. and Canada to use spices beyond flavoring food, which is expected to drive the market in upcoming years. The growing popularity of convenience and ready-to-eat foods and the increasing demand for ethnic cuisines have contributed to the growth of the spice market in the region. With the rising demand for Spices and Seasonings, the local manufacturers in the region are focused on introducing innovative and premier products to the consumers. For instance, in February 2021, The Pioneer Woman, a lifestyle brand represented by Earthbound Brands, announced launching a new line of custom seasonings created in collaboration with Old World Spices and Seasonings Inc., the premier spice blend manufacturer. Consumers can add signature seasonings flavors to their recipes with this new launch. Furthermore, the increase in immigration from Latin American and Asian countries also contributes significantly to the growth of this market in the region.
Asia Pacific market is likely to exhibit significant growth due to the growth of food processing industries in the region. India, China, and Vietnam are among the largest consumers and producers in the spice market. According to the Food and Agriculture Organization (FAO), the changing eating habits of people, especially in developing countries, are being impacted by rising incomes, urbanization, and rapid economic development. The growing interest in the traditional dish and exposure to exotic foods is estimated to positively impact the market.
The region's demand for organic spices increases as people become more aware of the consequences of chemicals and additives. Manufacturers are introducing herbs free of pesticides and other potentially harmful chemicals. For example, in January 2021, ORCO, also known as Organic Seasonings, an Indian-based company, launched 32 new products in its extensive portfolio of 100 percent natural, healthy, and certified organic seasonings and spices. The products are hand-ground on a hand mill (chakki) to preserve their natural properties, color, taste, and aroma.
Europe is expected to witness substantial growth because of the increasing inclination of young European consumers towards exotic and bold food flavors. Europe is one of the world's top importers of herbs and spices. It accounts for roughly one-quarter of total herb and spice imports worldwide. According to the Centre for the Promotion of Imports from developing countries, in 2020, Europe accounted for a 26% market share in the import of herbs and spices. The increasing demand for organic food in the region is further aiding the growth of the organic spices industry. In 2020, the organic food market of Germany grew by 20%. The frequently traded herbs and spices such as black pepper, chilies, and ginger are assumed to be relevant to the region's organic segment. In addition, premiumisation in Spices and Seasonings offering, increasing popularity of "better for you" ethnic food products, and rising consumer interest in innovative condiments laced with exotic and spicy flavors are projected to offer huge growth opportunities for the European market.
The Middle East and Africa region are predicted to witness growth as spices play an important role in the daily diet and nutrition and the socio-cultural setting of the different ethnic groups in the region. The increase in tourism and hospitality in the region has introduced a variety of demands in this Market, which is further expected to provide opportunities for the manufacturers.
Focus on Base Expansion by Market Players to Aid Market Growth
Some key players dominate the market due to key strategic decisions, market share dominance, and a strong product portfolio. McCormick & Company, Inc., Olam International, and Ajinomoto Co., Inc. are the market's leading players. Additionally, the key players also focus on launching innovative and authentic flavors to meet rising consumer demand. These players are collaborating with ingredient manufacturers to create exotic products. Furthermore, key players are working upon base expansion to increase their production capacity and expand its offerings across several food and beverage categories, including snacks, meats, and bakery.
For instance, In June 2021, Kerry Group Plc announced the start of its new taste facility in Latin America, which will serve mainly Central America, the Caribbean, Mexico, and the Andean region. Located in Irapuato, Mexico, the new state-of-the-art factory will significantly expand Kerry's capabilities in the region and further assist customers in providing locally flavored and sustainable solutions.
An Infographic Representation of Spices and Seasonings Market
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The market research report provides qualitative and quantitative insights into the market. It also offers a detailed analysis of its types, application, market size, and growth rate for all possible segments in the market.
Along with this, the report provides an elaborative industry analysis with market dynamics and competitive landscape. Various key insights presented in the report are an overview of related markets, research methodology, recent industry developments such as mergers & acquisitions, the regulatory scenario in critical countries, and key industry trends.
Value (USD billion)
Fortune Business Insights says that the value of the market was at USD 17.75 billion in 2021 and is projected to reach USD 25.42 billion by 2029.
Growing at a CAGR of 4.67%, the market will exhibit significant growth in the forecast period (2022-2029).
Pepper segment is expected to be the leading segment among types in the global market during the forecast period.
The rising veganism and vegetarianism trend is driving the growth of the market.
McCormick & Company, Inc., Olam International, Kerry Group Plc, and Ajinomoto Co., Inc. are a few of the key players in the market.
North America is expected to hold the highest market share.
The snacks & convenience food segment is expected to grow at the fastest pace during the forecast period.
Sustainable sourcing of spices to augment the market growth.
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