Hydrocolloids Market Analysis

The global hydrocolloids market size was valued at USD 9,733.69 million in 2021 and is anticipated to witness a compound annual growth rate (CAGR) of 6.08% from 2022 to 2030. Growing health consciousness among consumers and increasing demand for natural products are major factors that are driving growth of the market. The food industry is increasingly becoming sustainable, and manufacturers are turning to natural ingredients to reduce the environmental impact of food production. Environmental regulations and strict production standards have also encouraged the adoption of clean label products. This in turn has propelled demand for hydrocolloids.

Global Hydrocolloids Market: Regional Insights

Regionally, Asia Pacific region is expected to dominate the global market over the forecast period, driven by a rapidly expanding population and growing end-use sectors, including food and beverages. Moreover, the growth of the market is also fueled by low-cost skilled labor and developments in biotechnology. Moreover, increasing popularity of processed foods is further projected to propel the regional market growth.

North America is also expected to gain significant growth over the forecast period owing to the increasing sale retail food beverage stores. For instance, according to the US Census Bureau, the annual sales of retail food and beverage stores in the country accounted for USD 865.1 billion in 2020, compared to USD 773.6 billion in 2019. The sales is likely to rise in the coming years, considering the increasing demand, thereby, is likely to boost the demand for the hydrocolloids from various food and beverage applications.

Figure 1. Global Hydrocolloids Market Share (%), By Region, 2021

Global Hydrocolloids Market Drivers:

Growing demand from food and beverage industry is a prime factor driving growth of the hydrocolloids market. Hydrocolloids are widely used stabilizer, thickener, fat replacer, coating agent, and gelling agent in food industry. It is used to prepare frozen desserts, frozen meals, processed meat, sauce and dressings, various beverages, dairy products, fruit preserves (jam & jelly), and confectionery. In meat products it is used to reduce the fat content in order to enhance the taste of meat product.

Growing health consciousness among consumers and increasing demand for natural products are other factors that are driving growth of the market. In the cosmetic industry, they are often used in place of synthetic chemicals with similar properties. So, growing demand for natural based products is expected to augment market growth.

Global Hydrocolloids Market Opportunities:

The use of hydrocolloids in pharmaceutical formulations is expected to drive the market in the coming years. These products have numerous benefits, including reduced dosages, reduced side effects, and extended drug release. Pharmaceutical industry hold potential opportunities for hydrocolloids market.

Increasing R &D and innovation in hydrocolloids is also expected to serve major growth opportunities in the near future. Several firms are involved in R&D for various hydrocolloids such as pectin, etc., and products through the combination of various ingredients in order to explore new properties. At present, firms such as UNITEC FOODS Co. Ltd have been researching ingredients across various vectors such as manufacturing process, form, and shape, resulting in new properties and application.

Global Hydrocolloids Market Trends:

Natural hydrocolloids are gaining traction in the market. They are derived from plants such as cellulose gum, pectin, and locust bean gum, and from animals or microbes. Locust bean gums are widely used in processing foods such as ice creams, cheese, chocolate, meat products and others. Gum Arabic is another naturally derived hydrocolloid which is majorly used in frozen desserts.

Increasing focus of key players to expand production capacity of hydrocolloids in order to meet the growing demand across end-user industry is another major trend observed in the market. For instance, in March, 20219, CP Kelco announced an investment to expand pectin production capacity at its Limeira, Brazil, facility by approximately 10 percent. This expansion came into effect in 2020.

Hydrocolloids Market Report Coverage

Report Coverage	Details
Base Year:	2021	Market Size in 2021:	US$ 9,733.69 Mn
Historical Data for:	2017 to 2020	Forecast Period:	2022 to 2030
Forecast Period 2022 to 2030 CAGR:	6.08%	2030 Value Projection:	US$ 19,780.00 Mn
Geographies covered:	North America: U.S. and Canada Latin America: Brazil, Argentina, Mexico, and Rest of Latin America Europe: Germany, U.K., Spain, France, Italy, Russia, and Rest of Europe Asia Pacific: China, India, Japan, Australia, South Korea, ASEAN, and Rest of Asia Pacific Middle East: GCC Countries, Israel, and Rest of Middle East Africa: South Africa, North Africa, and Central Africa
Segments covered:	By Source: Natural, Synthetic By Type: Gelatin, Starches, Pectin, Xanthan, Carrageenan Alginates, Carboxymethyl Cellulose Guar Gum, Other Types By Application: Bakery and Confectionery, Meat and Poultry Products, Beverages, Sauces and Dressings, Dairy Products, Other Applications
Companies covered:	ADM, AGARMEX SA DE CV, Ashland, Cargill, Incorporated, CP Kelco US Inc., Dupont, DSM, Fufeng Group, Ingredion Incorporated, NOREVO GmBh, Silvateam SPA, and Tate & Lyle
Growth Drivers:	Growing demand from food and beverage industry Increasing focus of key players to expand production capacity of hydrocolloids
Restraints & Challenges:	Adherence to international quality standards and regulations Unfavorable condition arise due to Covid-19 outbreak

Global Hydrocolloids Market Restraints:

Adherence to international quality standards and regulations is expected to hinder the market growth. Hydrocolloids such as Carrageenan, Gelatin, Xanthan gum, Pectin, and Alginates are produced and used, through the employment of various strict regulations. For instance, Carrageenan and processed Eucheuma seaweed in the European Union are listed in Annex 1 of the European Parliament and Council Directive 95/2/EC on Food Additives other than Colors and Sweeteners as amended and assigned E-numbers of E407 and E407A (EU, 1995, 1998). Moreover, Xanthan gum is recognized as a food additive under the provisions of the United States Food and Drug Administration regulations (21 CFT 172.695) for use as a stabilizer, thickener, or emulsifier.

Unfavorable condition arise due to Covid-19 outbreak is expected to hamper the market growth. For instance, According to DSM, the demand for hydrocolloids was impacted in 2020 by a drop in the overall demand for on-the-go foods and beverages as a result of COVID-19.

Figure 2. Global Hydrocolloids Market Share (%) in terms of Values, By Source 2021

Global Hydrocolloids Market Segmentation:

The global Hydrocolloids market report is segmented into source, type, application, and region.

Based on source, the market is segmented into Natural and Synthetic. Out of which, Natural is expected to dominate the global market over the forecast period and this is attributed to the growing number of health conscious consumers worldwide. Also, growing demand for clean label products is contributing to the segment growth

Based on type, the market is segmented into Gelatin, Starches, Pectin, Xanthan, Carrageenan Alginates, Carboxymethyl Cellulose Guar Gum, and Other Types. Out of which, Pectin is expected to dominate the global market over the forecast period as it is naturally derived hydrocolloids. It is present in many fruits in variable amounts and qualities. Pectin is widely used in food industry as a gelling agent.

Xanthan segment is also expected to witness significant growth in the near future and this is owing to the growing demand for gluten-free bakery products. Moreover, it is also gaining demand from medical industry where it is used in drug manufacturing.

Based on application, the market is segmented into Bakery and Confectionery, Meat and Poultry Products, Beverages, Sauces and Dressings, Dairy Products, and Other Applications. Out of which, Bakery and Confectionery is expected to dominate the global market over the forecast period. Hydrocolloids are used to preserve the flavor and aroma of the baked and confectionery food products. Moreover, hydrocolloids are also used to reduce fat content.

Beverages segment is also expected to witness significant growth in the near future and this is owing to the growing demand for hydrocolloid for stabilizing and protecting flavors. Gum Arabic, pectin, or cellulose derivatives are widely used in beverages for enhancing the flavors and also replicating the high-calorie beverages.

Global Hydrocolloids Market: Key Developments

1. In September 2020, Hydrocolloids, Inc. (“WHI”), a pioneer in the Philippines seaweed industry and a major carrageenan supplier from the Philippines, acquired Cargill’s stake of the joint venture in Philippine Bio- Industries, Inc. (“PBI”). PBI is the first fully automated refined carrageenan facility in Asia, producing highly refined carrageenan and carrageenan blends for the food industry.
2. In October 2021, CP Kelco, announces the launch of GENU Pectin YM-SAL 200, an improved stabilizing solution for long shelf-life buttermilk with the saltier taste that consumers prefer.
3. In September 2021, CP Kelco, announced the expansion of its distribution agreement with IMCD to serve the growing market in Mexico. , IMCD will be the company’s strategic distributor in Mexico across all market segments of food, plus consumer and industrial (C&I) applications, for CP Kelco’s unique portfolio of hydrocolloid and fiber solutions, including GENU Pectin, KELCOGEL Gellan Gum, GENU Carrageenan, KELTROL Xanthan Gum etc.

Global Hydrocolloids Market: Key Companies Insights

The global Hydrocolloids market is highly competitive. This is attributed to continuous launch of new technologies due to ongoing R &D and efforts by value chain participants. Moreover, key players are adopting various business growth strategies in order to expand their presence on regional as well as global basis. Some of the key players in the global Hydrocolloids market are ADM, AGARMEX SA DE CV, Ashland, Cargill, Incorporated, CP Kelco US Inc., Dupont, DSM, Fufeng Group, Ingredion Incorporated, NOREVO GmBh, Silvateam SPA, and Tate & Lyle

*Definition: Hydrocolloids are used in many foods, including drinks, desserts, and cereals. They are often mixed with non-solvents such as corn syrup, alcohol, and sugar. Hydrocolloids are substances that have the ability to give foods the proper texture and form.