Bakers Journal

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Functional foods market still growing


February 28, 2008
By Bakers Journal

Feb. 27, 2008, London – The functional food and drink market in the
U.S., Western Europe and Asia-Pacific is entering a critical era, with
a number of inhibitors threatening to impact on the impressive growth
rates that the global market is currently experiencing, according to
"Functional Food, Drinks & Ingredients: Consumer Attitudes &
Trends," a new report from Datamonitor.

Feb. 27, 2008, London – The functional food and drink market in the U.S., Western Europe and Asia-Pacific is entering a critical era, with a number of inhibitors threatening to impact on the impressive growth rates that the global market is currently experiencing, according to "Functional Food, Drinks & Ingredients: Consumer Attitudes & Trends," a new report from independent market analyst Datamonitor.

According to the report, although consumers are actively seeking out food and drinks that optimize performance and reduce the risk of illness, they are becoming more skeptical about the health claims made by food and drink manufacturers. Furthermore, a lack of confidence in food and drink with ‘artificial’ ingredients means more consumers are opting for naturally healthy diets in order to boost wellness levels.
 
“Current market conditions suggest the functional food market will continue to witness impressive growth rates, says Michael Hughes, consumer market analyst and author of the study. “After all, changing social demographics and greater emphasis on maintaining health is driving the demand for foods rich in nutrients and minerals.”
 
The combined US, Western European and Asia-Pacific functional food and drink market is worth US$ 72.3 billion, Datamonitor analysis reveals. Datamonitor forecasts the US, Western European and Asia-Pacific functional food and drink market will grow at a compound annual growth rate (CAGR) of 5.7 per cent between 2007 and 2012.
 
Despite these impressive growth rates Datamonitor feels the market faces the challenge of deteriorating levels of consumer trust and confidence. Consumers are becoming less trustworthy of health claims made by food and drink manufacturers, often believing functional package claims to be either false or an excuse to command a premium price. As a result, Hughes believes it is “essential that manufacturers promote functional foods in a credible and honest manner and continue to educate consumers about the credence of emerging ingredients such as lycopene, prebiotic fiber and plant sterols.”
 
Continuous media coverage on food safety scares and product recalls has also left consumers dubious about the safety of foods containing artificial ingredients. Instead, more shoppers are seeking out naturally healthy options, such as organic and fresh produce.

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