Starch derivatives market

Market Size and Trends

The starch derivatives market is estimated to be valued at USD 60.31 Bn in 2024 and is expected to reach USD 76.73 Bn by 2031, growing at a compound annual growth rate (CAGR) of 3.5% from 2024 to 2031.

Starch derivatives have wide applications in various industries such as food & beverages, paper, textile, and pharmaceutical. The rising demand from these industries is driving the growth of this market. The starch derivatives market is expected to witness strong growth over the forecast period. Increased consumption of convenience and processed food globally is projected to boost the growth of the market. Moreover, rising need for biodegradable products across industries to cater to sustainability goals will provide opportunities for manufacturers. However, volatility in raw material prices may hamper the market growth to some extent over the next few years.

Growth of the Bakery and Confectionery Industry

The bakery and confectionery industry has seen steady growth globally over the past few years. The demand for bakery and confectionery products has increased significantly across regions due to increasing consumer awareness about health and taste, rising disposable incomes, and busy lifestyles. Starch derivatives play a key role in the bakery and confectionery sector as they are used as stabilizers, thickeners, and texturizers in a wide variety of products. Starches extracted from potatoes, maize, and wheat are the most commonly used starch derivatives in the industry. They allow for improved texture and quality in baked goods as well as make creams, lotions and other fillings easier to mix. For instance, modified starches are increasingly being used in cake mixes as they enhance moisture retention and provide volume and structure. Similarly, bakery products such as bread benefit from starch derivatives which help improve softness and freshness. Additionally, confectionery items like chocolate, candies and chewing gums employ starch derivatives to control crystallization and delay gumming. A significant trend in recent times is the rising demand for clean label and organic products. In line with this, manufacturers are utilizing starch sources such as cassava and arrowroot more often in place of GM corn and potato starches. According to FAO, cassava production reached over 280 million metric tons in Africa alone in 2020. This indigenous availability of cassava and other starches in growth regions has made it possible to formulate more natural products. Furthermore, developments in starch modification technology have significantly improved textures without compromising on taste. This allows the industry to cater to a wider variety of baked snacks and desserts.

Market Concentration and Competitive Landscape

Increasing Demand from Non-food Industries

Apart from food applications, starch derivatives are also finding significantly growing demand from several non-food industries like paper, textiles, pharmaceuticals, construction, etc. Owing to their film-forming, adhesive, binding, and texturizing properties, starches help manufacturers of various products. For example, starch derivatives are used in paper manufacturing as fillers and coatings to enhance paper quality, surface finish, and ink absorbency. In textiles, starches act as sizing agents that help in smoothing yarns and improving the finish and appearance of fabrics. Also, starches play an important role in construction chemicals like gypsum or cement, functioning as bonding and setting agents that improve the workability of concrete mixtures and other building materials. As infrastructure development takes place globally and industries like paper, textiles, and construction expand their operations, there is an increased requirement for starches that can offer solutions to various manufacturing needs. The robust growth of sectors beyond food over the next decade is estimated to drive future demand for starch derivatives.

Market Challenges: Fluctuating raw material prices

The starch derivatives market faces several challenges. Raw material prices are volatile and can significantly impact production costs. Additionally, alternative products are becoming more popular as consumers seek out natural and low-calorie options. Stringent regulations around ingredients and processing present compliance difficulties. Environmental concerns around agricultural production and waste disposal also loom large. Developing nations still lack advanced manufacturing capabilities as well, limiting the market growth potential.

 Market Opportunities: Rising health consciousness

Rising health consciousness is driving the demand for specialized formulations with specific functional benefits. Technological advancements continue to spur new product applications in areas like textiles, paper, and pharmaceuticals. As incomes rise across the developing world, starch derivatives are poised to gain ground as affordable dietary essentials and thickening agents. With innovation and sustainable practices, companies can meet consumer needs while assuaging public concerns over social and environmental impacts.

Insights, By Source: Conducive tropical climate is driving tapioca cultivation

In terms of source, tapioca contributes 35.2% share of the market owing to a combination of environmental and farming advantages. Tapioca, also known as cassava, originates in South America and requires a warm tropical climate to thrive. Many major producing countries such as Thailand, Nigeria, and Brazil experience long periods of warm weather year-round, ideal conditions for tapioca cultivation. The humid tropical climate enables intensive farming of the root vegetable with minimal other inputs. Farmers can cultivate tapioca with few irrigation or pest control requirements compared to other starch sources like wheat or corn. Abundant sunshine also means higher crop yields from the same acreage of land. Growing expertise of farmers in these countries has optimized tapioca farming practices for high productivity and starch extraction rates from the root crop. Conducive growing conditions coupled with established agricultural practices have made these regions global leaders in tapioca production.

Insights, By Method of Application: Versatility is driving binder usage

In terms of method of application, binder contributes 37.8% share of the market owing to the multi-functional uses of starch in bonding applications. Starch binders are versatile ingredients widely used in food processing, paper making, construction materials, and other industries. As a binder, starch coats and adheres particles together through film formation. It replaces synthetic petrochemical binders in many applications due to advantages such as renewable sourcing, low cost, and biodegradability. Starch binders effectively hold together ingredients in products ranging from snack foods to construction wallboards. Their bonding properties enable forming composite materials and coating applications across industries. Starch binders have established uses in a variety of manufacturing processes, creating demand from diverse end markets. Their functionality, compatibility with other materials and adaptability to changing production needs have made starch binders a staple binding agent.

 Insights, By End-User Industry: Growth of food processing is driving the segment growth

In terms of end user Industry, the food and beverage industry contributes 39.8% share of the market owing to the rising global consumption of processed foods. Starch derivatives play a number of roles as a food additive, improving texture, extending shelf life, and providing functional benefits. The food processing industry has experienced steady expansion globally to meet the growing worldwide demand for packaged and convenience foods. Rising incomes and urbanization in developing markets have supported this trend. Starch helps process larger volumes of ingredients while maintaining quality and safety standards. Its use allows customizing food properties and extending ranges of product formulations. As populations shift diets towards more prepared foods, the volume of starch derivatives included in food manufacturing has increased in turn. Growth in packaged food consumption on a global scale drives consistent demand from the food industry for functional starches.

Regional Insights

North America has established itself as a dominant region in the global starch derivatives market over the years with 39.8% of the market share. The market is driven by strong demand from key end-use industries such as food and beverages, paper making, and pharmaceuticals. Countries like the U.S. and Canada have a huge food processing industry which consumes starch derivatives like glucose syrup, maltodextrin, and hydrolyzed starch on a massive scale. The presence of leading global manufacturers in the region who have since long established production facilities catering to local demand has further cemented North America's leadership position. Moreover, North America also has a large pharmaceutical industry that relies on native and modified starches for various applications.

Asia Pacific has emerged as the fastest growing regional market for starch derivatives in recent times on account of robust economic growth and rising population in countries such as China, India, and Indonesia. Rapid industrialization and urbanization have propelled the demand from construction, packaging, and various process industries. Moreover, the food processing sector in Asia Pacific has also expanded significantly over the last decade to meet the needs of a burgeoning middle class. This has provided a significant boost to starch derivative consumption. Countries like China and India also have large native starch production capacities and are emerging as key exporters. Meanwhile, other South Asian nations are witnessing strong growth in starch derivative imports to meet the gap between local demand and supply.

Market Report Scope

Key Developments

• In October 2023, Cargill's strategic focus on South India expansion and investment in a Nellore manufacturing facility underscores its commitment to growth and market penetration. By allocating USD 35 million towards this endeavor, Cargill is not only expanding its physical presence but also enhancing its operational capabilities to meet the evolving demands of the Indian food market. This investment reflects Cargill's confidence in the region's potential and its proactive approach to capitalize on growth opportunities.
• In September 2023, Tate & Lyle partnered with IMCD in Finland and the Baltic region, expanding their ingredient distribution
• In June 2023, Tate & Lyle inaugurated a Customer Innovation and Collaboration Centre in Jakarta, Indonesia. This expansion enhanced its presence in Asia Pacific, enabling food science innovation tailored to local preferences, addressing health concerns, particularly diabetes, and bolstering their global network's expertise
• In March 2021, Ingredion Germany GmbH launched this modified potato starch, which can reduce cooking time and energy use. It is also suitable for low-fat, keto-friendly products.

*Definition: The starch derivatives market involves the manufacturing, processing, and sale of modified starch products derived from natural starch sources like corn, wheat, tapioca, and potato. Common starch derivatives produced include maltodextrin, glucose syrup, hydrogenated glucose syrup, sorbitol, xanthan gum, and methyl cellulose.

Market Segmentation

• Source Insights (Revenue, USD Bn, 2019 - 2031)
  • Wheat
  • Corn
  • Potato
  • Sorghum
  • Tapioca
  • Others
•  Method of Application Insights (Revenue, USD Bn, 2019 - 2031)
  • Binder
  • Thickener and stabilizer
  • Cake Mix
  • Sweetener
  • Lustering Agent
  • Powdering agent
  • Fish Culture Feed
  • Expanded Feed
  • Caking agent
  • Shampoo
  • Dehumidification Agent
  • Others (Culture Medium, etc.)
•  End User Industry Insights (Revenue, USD Bn, 2019 - 2031)
  • Food and beverage industry
  • Medical Industry
  • Agricultural Industry
  • Chemical Industry
  • Personal Care and Hygiene Industry
  • Paper and Pulp Industry
  • Textile Industry
  • Manufacturing Industry
  • Others (Construction Industry, etc.)
• Regional Insights (Revenue, USD Bn, 2019 - 2031)
  • North America
    • U.S.
    • Canada
  • Latin America
    • Brazil
    • Argentina
    • Mexico
    • Rest of Latin America
  • Europe
    • Germany
    • U.K.
    • Spain
    • France
    • Italy
    • Russia
    • Rest of Europe
  • Asia Pacific
    • China
    • India
    • Japan
    • Australia
    • South Korea
    • ASEAN
    • Rest of Asia Pacific
  • Middle East & Africa
    • GCC Countries
    • Israel
    • Rest of Middle East & Africa
• Key Players Insights
  • Cargill, Incorporated
  • ADM
  • Tate & Lyle PLC
  • Roquette freres
  • AGRANA Beteiligungs-AG
  • Ingredion Incorporated
  • Green Processing Corp. (GPC)
  • Avebe
  • Emsland Group
  • Foodchem International Corporation
  • Sukhjit Starch & Chemicals Ltd.
  • Universal Starch Chem Allied Ltd
  • Primient
  • SPAC Starch Products (India) Private Limited
  • JP&SB International
  • Matsutani Chemical Industry Co., Ltd
  • Crespel & Deiters Group
  • SMSCor.
  • Manildra Group
  • KMC