The overall Baking Ingredients market is projected to grow from USD 13 Billion in 2017 to USD 17 Billion by 2022, at a CAGR of 5.4%. The most widely used baking ingredients in the market are baking powder & mixes, starch, oils, fats & shortenings, enzymes, and emulsifiers. The key drivers for the market�s growth are the changing consumer lifestyles, preference for convenience foods, demand for gluten-free foods, and growing demand for natural and healthy ingredients. Growing competitiveness among small and medium players is further improving the outlook for a market that is considered to be highly fragmented. Increasing consumer awareness towards health has further bolstered the growth of cereals substitutes, which is considered a healthier alternative and is expected to pose a challenge for the baking ingredients market over the forecast period.

Baking powder and mixes segment is projected to be the largest contributor in the baking ingredients market during the forecast period

The Baking Ingredients market has been segmented on the basis of type into emulsifiers, leavening agents, enzymes, baking powder & mixes, Oils, fats, and shortenings, starch, and colors & flavors. The market for baking powder and mixes is projected to record the higher market share between 2017 and 2022. Baking powder is a mixture of baking soda, powdered acid, and cornstarch. It is used as a leavening agent that consists of sodium bicarbonate and the flavor saving acid that is used for increasing the volume, and lightening the texture of baked products. Baking powder which contains both fast and slow acting acids are known as double acting baking powder while single acting baking powder contains only one acid. Double acting baking powder is most commonly used for cookie dough. Baking mixes constitute various ingredients such as flour, baking powder, baking soda, yeast, sugar, and salt. Baking mixes are used for applications such as bread, cakes, waffles, muffins, and pizza crusts

Growing demand for bakery ingredients drive prospects for bread and cookies in the Baking Ingredients market

The Baking Ingredients market is segmented on the basis of application into breads, biscuits & cookies & biscuits, cakes & pastries, rolls & pies, and others which include pizza bases, donuts, tortillas, pretzels, scones, and cereals. Commercial bakers are the key buyers involved in the production of fresh & frozen bread, bread rolls and other fresh bakery products. These bakeries purchase bakery ingredients from ingredient manufacturers and procure flour directly from millers. These establishments sell their products through supermarkets, food service outlets, convenience stores, small retail outlets, and specialty stores. Some of these commercial bakeries also produce private label products in addition to the available private label brands sold by large-scale retailers.

Europe is projected to account for the largest market size during the forecast period

Europe accounted for 33.8%, the largest share of the baking ingredients market in 2016. Factors such as a large population and the subsequent increase in demand for baked food, and the usage of advanced technologies for producing varieties of baked foods in order to meet the changing demand of consumers are driving the European baking ingredients market. The market in the Asia-Pacific region is projected to grow at the highest CAGR of 6.5% during the forecast period, driven by the growing demand for leavening agents, emulsifiers, and fats & shortenings in major baking applications such as bread and biscuits & cookies. North America was the second-largest market and accounted for a 28.3% share in 2016.

Source: Secondary Research, Primary Interviews, Industry Journals, Related Research Publications, Press Releases, and MarketsandMarkets Analysis

Market Dynamics

Changing consumer lifestyles increase the demand for convenience foods and support demand for baked goods

Emerging markets such as Asia, Latin America, and Africa show strong potential for growth due to changing lifestyles and eating habits of consumers along with rising per capita consumption. China is emerging as the high potential market for bakery products. Improvement in the standard of living and lack of time for preparing home cooked food drives the demand for baking ingredients. Additionally, the increasing population of working women has led to an increase in the demand for baked products, as they are becoming a part of conventional diets in both urban and semi-urban areas. The market for products such as bread, cereal, cakes, biscuits, and pastries is well-established in Europe, as it has a higher per capita consumption of these products.

Stringent regulations and international quality standards to impact baking ingredients

Baking ingredients are a mixture of various compounds and are subjected to rigorous health and safety checks based on the governmental regulations in different countries. Various studies have been conducted by regulatory bodies to assess the impact of these products on human health. Based on their results, products are classified, and the daily intake allowance (DIA) has been set. International bodies such as the National Food Safety and Quality Service (SENASA), Canadian Food Inspection Agency (CFIA), U.S. Food and Drug Administration (FDA), World Health Organization (WHO), and Committee on the Environment, Public Health and Food Safety (EU) are associated with food safety regulations. These organizations have control over the usage of different chemicals and materials used in food processing, directly or indirectly.

Emerging functions of baking ingredients to drive market growth

Consumer demand for baked products with favorable taste, texture, and mouthfeel has resulted in the development of various new functions of ingredients in the form of enzymes, emulsifiers, leavening agents, and fats & oils, which are used in bread, cakes, muffins, and pizza crusts. Ingredients such as enzymes improve protein solubility and reduce bitterness in the end products, in order to facilitate the production of great-tasting nutritional foods. With heavy investment in R&D, new functions across various baking ingredients are emerging rapidly, such as protein-based fat replacements, flavor enhancements, textural improvements, and prolonging the shelf life of products.

Growing substitution of baked products with cereals to affect baking ingredient prospects

As a result of the health-conscious approach of consumers, manufacturers are constantly searching for alternative ways to develop low-calorie products. Consumers are looking to cut down their sugar, fat, and bread consumption. Hence, they prefer healthy snacks, granola bars, and cereal. The growing substitution of baked goods with cereals and other options is difficult to counter unless there are nutritious and innovative products in the bakery ingredients category. To meet this challenge, many baking ingredient manufacturers have introduced numerous high-fiber additives as ingredients in a variety of foods, especially baked products, to satisfy consumer demand for increased fiber content in foods.

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Scope of the Report

Report Metric Details Market size estimation 2017-2022 Base year considered 2017 Forecast period considered 2017-2022 Units considered Value (USD) Segments covered Type, Application, and Region Regions covered North America, Europe, Asia Pacific, and RoW Companies studied Archer Deniels Midland (US), Koninklijke DSM N.V (Netherlands),Cargill Incorporated (US), BASF SE (Germany), Ingredion Incorporated (US), Roquette Fr�res (France), SunOpta (Canada), Darling Ingredients Inc. (US), Omega Protein Corporation (US), DowDuPont Inc. (US), Kemin Industries, Inc. (US), InVivo (France), and John Pointon & Sons Ltd.(UK).

On the basis of type, the baking ingredients market has been segmented as follows:

Emulsifiers

Leavening agents

Enzymes

Baking powder & mixes

Oils, Fats, and shortenings

Colors & flavors

Starch

Others (baking soda, eggs, honey, yeasts, fruits, and nuts)

On the basis of application, the baking ingredients market has been segmented as follows:

Breads

Cookies & biscuits

Rolls & pies

Cakes & pastries

Others (pizza bases, donuts, tortillas, pretzels, scones, and cereals)

On the basis of region, the baking ingredients have been segmented as follows:

North America

Europe

Asia Pacific

RoW (The Middle East & Africa)

Recent Developments

Date Company Development December 2016 Cargill Cargill (U.S.) expanded its line of emulsifiers with the addition of deoiled canola lecithin. These canola lecithins are used in various food applications such as chocolate & confectionery, bakery, and convenience foods. April 2016 Associated British Foods Plc Associated British Foods plc (U.K.) acquired Illovo Sugar Limited (South Africa), the largest sugar producer in Africa. This is expected to help the company enhance its operations in Africa. October 2015 Koninklijke DSM N.V. Koninklijke DSM N.V. (the Netherlands) launched a new product under the trade name BakeZyme Go Pure. It is a glucose oxidase originating from Penicillium chrysogenum and is used for functional oxidation in bread making. This product is added to the baking enzyme product portfolio.

Key questions addressed by the report: