The functional protein market comprises products such as plant-based protein, specialty protein, and other forms of protein that provide additional health benefits. Functional protein ingredients are increasingly being added to food and beverages for their nutritional value, texture, and ability to help consumers achieve their health and fitness goals. The growing trend towards preventive healthcare and consumption of health-promoting foods has substantially driven the demand for high-protein and nutritious ingredients.
The Global Functional Protein Market Size is estimated to be valued at US$ 5.6 Bn in 2024 and is expected to exhibit a CAGR of 5.6% over the forecast period 2024 to 2031.
Key Takeaways
Key players operating in the functional protein market include ADM, Cargill, Ingredion, Arla Foods, Roquette, BASF, Glanbia, Fonterra, DSM, FrieslandCampina, Essentia Protein Solutions, Amai Proteins, Mycorena, Merit Functional Foods, Plantible Foods, BENEO, ProtiFarm, and Omega Protein. These players are engaged in new product development and capacity expansion to strengthen their market position.
The key opportunities in the functional protein market include growing demand for plant-based proteins and convenient packaged foods. The global expansion of major players through acquisitions and partnerships will also aid the market growth. Cargill recently acquired Danish manufacturer EWOS to bolster its aquaculture business. Merit Functional Foods raised USD 175 million in funding to build a new pea protein production facility in Canada.
Asia Pacific represents a lucrative expansion opportunity with the rising health-conscious consumer base and growing protein deficiency in the region. Countries like India, China, and Japan are expected to witness high demand for functional protein ingredients in the coming years. Players are investing in marketing and distribution networks across Asia to capitalize on these opportunities.
Market Drivers
The main driver for the functional protein market is the growing health and wellness trend among consumers leading to increased demand for protein-rich and nutrition-packed food products. Protein fortification is finding applications in various product categories like baked goods, beverages, dairy alternatives, meat analogs etc. The changing lifestyle and busy schedules have also augmented the demand for convenient packaged foods containing functional proteins.
Market Restrain
However, the functional protein market growth can be restrained due to the high production and processing cost of plant-based and specialty proteins. Concerns around allergens associated with certain protein sources is another challenge. Fluctuations in raw material supply and prices create uncertainties for manufacturers in this market. Strict regulatory frameworks regarding new product launches and health claims need to be adhered to.
Segment Analysis
The functional protein market is dominated by plant-based proteins, which account for more than 35% of revenue in 2024. This is due to rising consumer preference for vegan and plant-based diets owing to health and environmental sustainability factors. Within plant proteins, soy protein is the leading segment given its wide availability and applications across various food products such as bakery, snacks, beverages etc. However, the wheat protein segment is witnessing faster growth rates over 5% annually owing to increasing demand for gluten-free products.
Regional Analysis
North America is currently the largest regional market for functional proteins and accounted for more than 30% of global revenue in 2024. This is attributed to high health consciousness among consumers and frequent launches of new protein-enriched products by food & beverage companies in the region. Asia Pacific is projected to be the fastest growing regional market between 2024-2031 considering rising incomes, growing middle class, and expanding food processing industry in countries such as China and India. China in particular is expected to outpace other Asian countries during the forecast period.
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