The Global Market for Carotenoids

  • September 2011
  • -
  • BCC Research

Summary

Table of Contents


REPORT HIGHLIGHTS


• The current market value of commercially used carotenoids is estimated at nearly $1.2 billion in 2010, with a chance to grow to $1.4 billion in 2018 with a compound annual growth rate of 2.3%.
• The market value of beta-carotene, estimated at around $250 million in 2007, increased to just $261 million in 2010. This market is expected to grow to $334 million by 2018 at a compound annual growth rate of 3.1%.
• The market value of lutein was around $233 million in 2010, and is expected to reach $309 million by 2018 with a compound annual growth rate of 3.6%.

INTRODUCTION

BACKGROUND

This report is an update of BCC Research report FOD025C The Global Market for Carotenoids published in 2008. The market setup for carotenoids over the past 3 years developed further, changed dramatically in some areas, and saw a reverse of the previous trend of decreasing prices across most products. The main categories of carotenoids are still the same; no new types of carotenoids entered the market, but new manufacturing technologies were introduced for some products.

Beta-carotene is still the most prominent carotenoid. While consumption developed only very moderately, products across all types of formulation and origin are no longer available at the price range seen in 2007. A general rise in prices resulted in an increase of the overall market value. In 2010, BASF took over Cognis, the only sizable company producing beta-carotene from algae, and in 2011, DSM acquired Vitatene, an important producer of beta-carotene by fermentation. Generally, the manufacturing industry structures were consolidated, and several companies that were in the market during the mid-2000s disappeared. Now, a very limited number of companies dominate this global business.

Lycopene, an antioxidant recommended to prevent prostate cancer, obtained permission from the European authorities to be used as a food additive and coloring agent. The industry hopes that this authorization will help to reinvigorate product sales that in its traditional outlets showed only moderate growth over the past years.

Astaxanthin, the color of choice for pigmenting fish and shrimp, expanded only marginally and is contested by canthaxanthin. A new production system, based on the fermentation of a bacterium, allowed the market INTRODUCTION of a natural astaxanthin at the price of the synthetic analogue. This product, much more than the previous organic standards derived from yeast or algae, has the potential to develop a serious threat for synthetic astaxanthin.

Canthaxanthin is still the color of choice for providing a red tone in egg yolks and is a major competitor in the pigmenting of salmonid fish and shrimp. Canthaxanthin is the only carotenoid for which the decreasing price trend could not yet be brought to a hold. Moreover, European authorities plan to ban canthaxanthin use in food completely, which potentially has effects on the use of canthaxanthin in other parts of the world.

The lutein supplement market boomed until 2004, found its peak and is nowadays growing at a steady rate. Due to shortages in raw materials, the long-term price downtrend for feed grade lutein, which prevailed until 2007, reversed. Overall the market value for lutein expanded strongly.

Paprika extracts and capsanthin, the purified coloring component, are gradually becoming products of choice for pigmenting savory food products with a distinct red shade. Paprika is also increasingly used for broiler skin and egg coloring, competing with canthaxanthin. Purified products are short in the market, but due to strong competition, prices are only moderately increasing.

Annatto, the only carotenoid extracted from the fruits of a tree, has been in the market for many decades. Demand is still rising, driven by consumer desire for true natural alternatives to synthetic colors in pigmenting, particularly dairy products with a reddish-orange shade, but the long-term trend of decreasing annatto, bixin, and norbixin prices could be brought to a halt.

REASONS FOR DOING THE STUDY

The present study reviews the world of commercial carotenoids with the objective to provide a detailed insight into production technologies, market developments, and dynamics, to give producers and users of carotenoids a transparent overview on the current situation and a well-founded outlook until 2018.

INTENDED AUDIENCE

BCC Research seeks to provide insight into an industry that is still at the forefront of technology. The report intends to assist producing companies and users of carotenoids in the food, feed, and supplement industries by providing them with a comprehensive overview of the carotenoid industry. Strategy and business planning should become easier and more reliable. The report may also help companies and players in other ingredient markets who are considering diversification into attractive and well-fitting sectors, one of which may be carotenoids.

SCOPE OF REPORT

This report reviews the global market of the commercialized carotenoids:

* Annatto
* Astaxanthin
* Beta-carotene
* Beta-apo-8-carotenal
* Beta-apo-8-carotenal-ester
* Canthaxanthin
* Capsanthin and paprika extract
* Lutein
* Lycopene
* Zeaxanthin

The report starts with a synopsis of the current carotenoid market, and goes on to show, in quantitative figures, the relevance of different production systems, application segments, regional distribution, and dominating players.

Before entering into the product sections, a separate chapter comprehensively discusses the different modes of carotenoid production, contrasting chemical synthesis, fermentation systems, and extraction from botanical sources. A general outline on the current trends in the major application sectors of carotenoids, food, feed, and nutritional supplements, leads to the product sections that discuss markets and market trends of each carotenoid separately and in detail. In each case, product identities are given, typical data sheets of commercial formulations are provided, and the current regulatory status in the major markets is reviewed. The long time series of consumption data allow the identification of trends and particularly the determination of the position of the product at the sigmoid life cycle curve. Similarly long price series allow the analysis of trends and of inflexion points. The chapter on marketing strategies and market shares of major players concludes the overview on the current situation, and leads to the forecast of future trends, prices, consumption, and market values in 2018.

The methodology that is applied in this report is based on both an analysis of the manufacturing industry and of the user community. The user community is composed of companies active in the typical application segments of food, feed, and supplements and, to a smaller extent, cosmetics. Application trends over the past years are identified and company strategies and behavior analyzed. Insight into usage patterns are provided, leading to preliminary estimates on quantities used and of market values of specific products. Such supplemented and adjusted information is crosschecked with production data from manufacturers. The detailed analyses of manufacturing patterns also provide information on formulation trends and on how products are marketed. Considering framework conditions that affect future demand, estimates on developments in specific carotenoids are provided, leading to forecasts up through 2018.

METHODOLOGY AND INFORMATION SOURCES

Both primary and secondary research methodologies were used in preparing this study. Public information on carotenoids is quite vast. Aside from company reports, product brochures, and other published documents, it is the direct contact between the analyst and representatives of the relevant industry that provides reliable and quantitative information of carotenoids, and ensures the high quality of this report.

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