Nutraceutical beverages to drive flavour growth

Demand for flavours and fragrances in the US is forecast to grow 4.6 per cent per annum to $5 billion (5.5 billion euros) in 2005, market analyst The Freedonia Group​ reports this week. According to the report gains will be driven by the use of higher flavour and fragrance loadings to enhance the sensory appeal of fortified foods, nutraceutical beverages, cosmeceutical skin care products, tooth whitening systems and other innovative consumer products containing strong tasting and/or malodorous active ingredients. Flavour blends will remain the largest segment of the flavours and fragrances market, with 36 per cent of total demand in 2005. However, fragrance blends are expected to post faster gains and nearly overtake flavour blends by 2005 due to strong growth in skin care cosmeceuticals and other cosmetic and toiletry applications. The report claims that essential oils will record the fastest growth, with advances of 5.3 per cent per annum to $700 million (780 million euros) in 2005. Increases will be spurred by customer preferences for natural ingredients in food, beverage and personal care products. While the overall pricing environment is expected to remain weak, downward pressures, which are particularly strong on less expensive flavour and fragrance materials used in detergent and other industrial sectors, will have less impact on essential oils which are used in fine fragrance applications. However, volatility in the supply and pricing of some essential oils is pushing end users to develop substitutes for these products. Alternative beverages, including soy-based, nutraceutical, energy and other New Age drinks, represent the fastest growth market for flavours, spurred by the constant quest for new and innovative flavours, and the need for elevated flavour levels to mask the unpleasant taste of botanical and other additives. Demand for non-soft drink beverages overall is forecast to increase 6.7 per cent per annum through 2005, with further advances moderated by the less flavouring-intensive nature of many of these beverages vis-a-vis soft drinks.