|
|
|
You can get e-magazine links on WhatsApp. Click here
|
|
|
|
|
|
Market in South East Asia growing at 8.8% CAGR
|
|
Monday, 03 January, 2022, 12 : 00 PM [IST]
|
|
Dr R B Smarta
|
The nutraceuticals market of South East Asia is a flourishing market with various avenues offering lucrative investment opportunities. The market has a CAGR of 8.8% and this is primarily driven by innovative products and vigorous trends in consumption. With countries like Vietnam, Singapore, Malaysia and Indonesia, the region is an attractive marketplace for nutraceuticals brands to set foot and expand. Also, the Vietnamese probiotics market is expected to rise at an annual growth rate of 10%, presenting emerging opportunities for nutraceuticals players in the region.
The South East Asian market is predominantly governed by 3 segments namely, functional foods, functional beverages and dietary supplements. Let us have a look at these three segments in detail along with their drivers of the market.
Functional foods
Functional food provides additional health benefits along with meeting the basic nutritional requirements. They include ingredients such as dietary fibres, probiotics, carotenoids and vitamins. The functional food market of the Asia Pacific itself is projected to reach $71 billion in the year 2025.
The major drivers of this market are:
- Rise in the disposable income of the consumers.
- Better distribution channels resulting in increased product availability.
- Increase in chronic diseases.
Yakult Honsha Co. Ltd., BASF SE, PepsiCo., Kellogg Company, Nestle, Agro Tech Foods Ltd., GlaxoSmithKline Company and General Mills are some of the key market players of the industry who are staying competitive with strategies like mergers & acquisitions and launching new products.
Functional beverages
Functional beverages include beverages such as energy drinks, dairy supplements and their alternatives and fortified drinks. Furthermore, flavours and their blends are one of the most demanding trends in the market resulting in numerous combinations as the market players formulate in order to stay relevant in the market. The CAGR of the Asia Pacific market is recorded to be around 7.5% by the year 2025.
Growth drivers
- Clean labels: This is one of the most important drivers in the South East Asian functional beverages industry as it inculcates trust amongst consumers. According to a report, 20.09% of the products contain one or more ingredients that are natural and organic in nature. Additionally, there is a rise in awareness among consumers who have understood the importance of organic ingredients.
- Large market potential: The Asian market has a robust market for beverages resulting in growth opportunities. The rise in the disposable income of the consumers and the desire for a healthy lifestyle further facilitate the market.
Key Players
Some of the key players include: PepsiCo. Inc.; Monster Beverage Corporation; Fonterra Co-operative Group; Red Bull GmbH.
Dietary supplements
The preventative healthcare and an urge to consume nutrition for a healthier lifestyle have made this segment the most demanding segment of the South East Asian nutraceuticals market. The dietary supplement industry was valued to be around $6.9 billion in 2018 and has a projection of over $10 billion in 2026, exhibiting a CAGR of 5.6%.
Key Market Players
Some of the key players include: Pfizer Inc.; Nestle S. A.; Herbalife Nutrition Ltd; Abbott; GlaxoSmithKline Company.
Market drivers
Some of the market drivers of the dietary supplement market are as follows:
- Rise in preventative healthcare: Sedentary and hectic lifestyle, global pandemic and the ageing population are some of the factors because of which there is a rise in lifestyle diseases and this has led to a preventative mindset among the consumers. Dietary supplements, particularly, herbal-based products are in the demand.
- Consumer awareness and increase in sports-based products: There is an increase in awareness in the consumers regarding dietary supplements. Particularly, the merits of energy-boosters and sports nutrition supplements are in the demand.
As we can see, the nutraceuticals industry is robust in South East Asia. Furthermore, let us have a look at some of the South East Asian countries that are excelling in the nutraceuticals domain.
Vietnam
The nutraceuticals market of Vietnam ranks second with respect to functional beverages. Additionally, dairy supplements consumption ranked second in 2019. Energy drinks are one of the strongest segments in the country. As per a report, the growth rate of the Vietnamese functional food segment is the highest of all the South East Asian countries. Along with dairy products, herbal supplements are the most demanding products in the market of Vietnam. The Covid-19 has led to an increase in health-consciousness among the consumers which has also led to an increase in demand for probiotics. The probiotic industry has shown a 10% annual growth rate even during the pandemic.
Singapore
The consumers’ inclination towards organic and natural ingredients is the strongest driving factor for Singapore’s herbal dietary supplement industry. Ingredients such as garlic, biloba and ginseng are in demand and will drive the market in the future. Furthermore, increased digitisation has increased sale via digital retailing and online marketing. This will result in an increase in sales of vitamin supplements and functional food and beverages. Along with that, changing lifestyle and digestive health concerns have led to an increase in demand for fortified dairy products.
Malaysia
Source: Research CMFE Malaysia has some of the oldest rainforests in the world which has resulted in an increase in demand for herbal nutraceuticals supplements. The potent medicinal plants and the abundant raw materials provide the necessary advantage for the country to stay relevant in the market. It is quite evident in the fact over 50% of the medicinal products that are registered belonged to the natural origin.
Furthermore, the Government of Malaysia has introduced various policies such as National Key Economic Areas (NKEA), National Biodiversity Policy and National Agro-Food Policy (NAP) to encourage local herbal industry and enhance the R&D sector of the country.
The path ahead
The nutraceuticals market of South East Asia had taken an initial hit owing to the pandemic. However, the market has revived and is running at a good pace. It is essential to monitor the authenticity of the product in the current scenario. As the market is growing rapidly, various counterfeit products affect the health of consumers. It is necessary to maintain strict regulation preventing counterfeit products from entering the market as the South East Asian market is set to achieve great heights.
(The author is CMD, Interlink, and VP, HADSA)
|
|
|
|
|
|
|
|
|
|