Natural food colors are obtained from natural sources like fruits and vegetables, and do not undergo any chemical process. They are less toxic as compared to artificial colors. Natural colors are used in various food products like bakery, confectionary, beverages and desserts to enhance the visual appeal of packaged foods.They provide a lively, vibrant look to various food items. The growing health consciousness among consumers regarding intake of artificial food additives is propelling the demand for natural food colors.

The global Natural Food Colors Market is estimated to be valued at US$ 2.05 Bn in 2023 and is expected to exhibit a CAGR of 12% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.

Market Opportunity:

Increasing Demand from Food and Beverages Industry

There is an increasing demand for natural food colors from the food and beverages industry worldwide. With rising health concerns and awareness regarding use of artificial additives, consumers preference is shifting towards packaged food products containing natural ingredients. Food manufacturers are increasingly using natural food colors to cater to this demand. According to survey, over 81% of consumers check labels for natural/ artificial content before purchasing food products. This growing demand from food industry for naturally sourced colors provides huge market opportunity for natural food colors manufacturers. Global natural food colors market size allow manufacturers to offer clean label products, enhancing brand image and increasing consumer base.

Porter's Analysis

Threat of new entrants: Low capital requirement for entry however established brands and regulations pose entry barriers.

Bargaining power of buyers: Buyers have moderate bargaining power due to availability of substitutes however quality standards and certifications increase buyer switching costs.

Bargaining power of suppliers: Suppliers have high bargaining power due to specialized skills and resources required for production along with few key suppliers dominating the market.

Threat of new substitutes: Threat is moderate as artificial colors are substitutes however growing health awareness increases demand for natural colors.

Competitive rivalry: High due to presence of established brands and private label products.

SWOT Analysis

Strength: Growing health and wellness trend drives demand. Wide applications in food and beverages industries.

Weakness: Price volatility of raw materials impacts costs. Limited shelf life and stability compared to artificial colors.

Opportunity: Expanding organic and natural food market presents new opportunities. Developing economies boosting packaged food demand.

Threats: Stringent regulations on usage levels and toxic contaminants. Substitutes like artificial colors impacting market share.

Key Takeaways

The global natural food colors market is expected to witness high growth over the forecast period due to growing health awareness.

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