Fermented Flavor and Fragrance Ingredients Market is expected to reach US$ 2.68 billion by 2030

Rising Sustainability Concern Drives Fermented Flavor and Fragrance Ingredients Market Growth

According to our latest market study on "Global Fermented Flavor and Fragrance Ingredients Market Forecast to 2030 – Global Analysis – by Type and Application," the global fermented flavor and fragrance ingredients market size is expected to grow from US$ 1.34 billion in 2022 to US$ 2.68 billion by 2030; it is expected to register a CAGR of 9.0% from 2022 to 2030.

Over the past few years, climate change has affected the earth's natural ecosystems and posed a significant threat to the well-being of people. Thus, consumers are becoming conscious of the environmental impact associated with the products they use and assert a preference for sustainable ones. They are willing to pay extra for products and services from companies committed to sustainability principles, such as a positive environmental and social impact. Thus, the industry's practices are evolving to meet the health-consciousness of consumers and demands for sustainability and environmental benefits.

Global Fermented Flavor and Fragrance Ingredients Market – by Region

Flavors and fragrances made via synthetic extraction processes consist of chemicals and other fossil fuels, which can harm the environment and human health. The flavors and fragrances made using fossil fuels increase carbon (CO2) and greenhouse gas emissions. For instance, synthetic vanilla flavor called vanillin is significantly more used flavor than natural vanilla flavors owing to its affordability and availability. But vanillin is synthetically manufactured from fossil fuel and wood pulp. Moreover, the yield of natural vanilla flavor extracted from vanilla pods is extremely low. It takes 500 Kg of vanilla pods to obtain 1 Kg of flavor. Thus, both the traditionally used natural process and synthetic process of flavors and fragrances are not sustainable. Similarly, the production of raspberry aroma by farming would require more than 100 metric ton of raspberries, which translates to ~40 football fields of cultivated acreage—a highly unsustainable use of land. Thus, the production of synthetic ingredients, as well as traditionally produced natural ingredients, can harm the environment.

Fermentation is an alternative technology developed to produce flavors and fragrances through sustainable methods and is also considered "natural." According to the US Environmental Protection Agency (EPA), Bioengineering for Pollution Prevention study, fermentation is a more sustainable method of production than traditional chemical synthesis because it is more resource-efficient and generates fewer byproducts. Thus, the flavors and fragrances produced by fermentation do not harm the environment and are labeled as natural and sustainable ingredients. Thus, rising sustainability concerns among end-use industries such as food & beverages, perfumeries, cosmetics, and personal care boost the demand for fermented flavors and fragrances across the globe. Thus, all these factors are driving the fermented flavor and fragrance ingredients market.

Global fermented flavors and fragrance manufacturers are investing significantly in strategic development initiatives such as product innovation, merger & acquisition, partnerships, production capacity scaleup, and expansion of their businesses to attract consumers. For instance, in May 2023, Evolva signed a multi-year agreement with an undisclosed contract manufacturing organization (CMO) to supply vanillin made by precision fermentation for use in fragrances. Such partnerships influence to increase the production capacity of the company to produce fermented flavors and fragrances. Moreover, in December 2022, Danish aroma company EvodiaBio secured US$ 6.4 million in funding for its sustainable aroma production for food and beverages. The company produces aromas for beer through precision fermentation methods. The company also claimed that this tech solution reduces water and CO2 emissions by over 90%. Thus, constant initiatives by the key players to extend their domestic reach and gain a competitive edge propels the fermented flavor and fragrance ingredients market globally.

Fermentation is regarded as a natural process by the Food and Drugs Administration (FDA), and fermented flavors are considered "natural flavors." For instance, Solvay is producing vanillin using naturally occurring yeast and claiming the products as "natural." Thus, the increasing demand for natural flavors among various end-use industries boosts the demand for fermented flavors and fragrances. Additionally, fermented flavors and fragrances are manufactured using genetically engineered microbes. For example, Evolva claimed their fermented vanillin is non-GMO as it is made of genetically engineered yeast. Thus, the growing demand for clean-label and non-GMO products is expected to remain a fermented flavor and fragrance ingredients market trend in the coming years.

The fermented flavor and fragrance ingredients market analysis has been carried out by considering the following segments: type, application, and Geography. Based on type, the market is segmented into fruity, floral, woody, blends, and others. By application, the market is segmented into food and beverages, personal care products, cosmetics, and others. By geography, the scope of the fermented flavor and fragrance ingredients market report is divided into North America, Europe, Asia Pacific (APAC), the Middle East & Africa (MEA), and South & Central America.

Based on Application, the personal care segment is anticipated to hold a significant fermented flavor and fragrance ingredients market share in 2022. The rising concern about skin diseases and skin problems across the globe has boosted the use of natural ingredients in the personal care industry. This has surged the incorporation of fermented flavors and fragrances in personal care products such as body oil, body lotion, shampoo and conditioners, and bath products. Further, the adoption of "clean label" and "natural" products is increasing worldwide. Thus, personal care manufacturers demand ingredients that are free from any synthetic chemicals and are considered natural. This has led to the increasing use of fermented flavors and fragrances as "natural" additives for the manufacturing of personal care products.

Givaudan SA, Firmenich International SA, Takasago International Corp, BASF SE, Evolva Holding SA, Amyris Inc, Insempra GmbH, Conagen Inc, Jeneil Biotech Inc, and Dohler GmbH are among the prominent players profiled in fermented flavor and fragrance ingredients market report. These companies develop innovative products to strengthen their position. For instance, in May 2022, Firmenich International SA acquired ArtSci Biology Technologies (Hangzhou) Co Ltd,. The move strengthens Firmenich's ability to serve the rapidly growing Chinese local market and extend its geographic reach across China. Such strategic initiatives by key players in the market boost the fermented flavor and fragrance ingredients market growth.

By geography, the market is divided into North America, Europe, Asia Pacific (APAC), the Middle East & Africa (MEA), and South & Central America. In terms of revenue Europe dominates the  fermented flavor and fragrance ingredients market share. In North America is further segmented into the US, Canada, and Mexico. The European market is sub-segmented into Germany, France, the UK, Italy, Russia, and the Rest of Europe. The market in Asia Pacific is further segmented into China, India, Japan, Australia, South Korea, and the Rest of Asia Pacific. The fermented flavor and fragrance ingredients market in the MEA is further segmented into South Africa, Saudi Arabia, the UAE, and the Rest of MEA. The fermented flavor and fragrance ingredients market in South & Central America is sub-segmented into Brazil, Argentina, and the Rest of South & Central America.

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