The global tea extracts market is estimated to be valued at USD 2.5 billion in 2019 and is projected to reach USD 3.8 billion by 2025, recording a CAGR of 6.9%. The market is projected to witness significant growth due to factors such as the increase in the consumption of functional foods, rise in health consciousness among consumers, and increasing adoption of tea due to the ill-effects from caffeine, thereby widening the scope of its applications. The increasing market potential, growing population, and growing demand for different types of tea extracts, as per health benefits, are factors that are projected to impact the growth of the tea extracts market.
The demand for tea extracts remains high across developed markets, such as the US and UK. Developing countries, such as China, Brazil, and India, are projected to witness a surge in demand for tea extracts in the coming years. This demand is projected to remain high due to the increase in the production of processed and functional food products. Emerging economies, such as Malaysia, Indonesia, and Thailand, in the Asia Pacific region, are also witnessing high growth. In addition, the exponential growth is projected to be witnessed in the new and emerging markets, such as China, India, and other Asia Pacific countries.
Key manufacturers are focusing on expanding in Asia, as it offers cost-effective benefits to manufacturers, in terms of production and processing, due to the low prices of raw materials and cheap labor. The rise in the standard of living and changes in lifestyles in developing countries also contribute to the growth of the functional food and convenience products market.
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Companies are increasingly investing in R&D activities, and new product launches to incorporate the formulations of existing products and cater to customer requirements. Companies are focusing on innovating new products to benefit their customers. The rise in health concerns and the consumer demand for healthy products are expected to encourage companies to invest in research & development activities. Top players such as ADM (US), Givaudan (Switzerland), and Dupont (US) are focusing on engaging in research & development activities to meet the increasing demand for tea extracts in various applications. In June 2019, Givaudan (Switzerland) launched its innovation center to produce differentiated flavors, taste, and aroma in various products, such as food, beverages, and personal care. The company has also acquired Naturex (US), an international leader in plant extraction, to set up its foot in the US market.
By application, the tea extracts market is segmented into food, beverages, pharmaceuticals, and cosmetics. Beverages are the most popular application of tea extracts, as tea has been one of the conventional beverages since time immemorial. Also, due to its antioxidant and anti-inflammatory properties, it has gained popularity in recent times, aligning with the shift towards the healthy lifestyle among consumers. Hence, the beverages segment is estimated to dominate the market in 2019, by application.
Green tea extracts are used in various applications, such as food, beverages, and cosmetics. Due to the rising health consciousness, consumers are shifting towards the non-conventional type of nutrient options. Consumers are willing to spend on luxury foods and beverages due to the increase in disposable income and the rise in geriatric population. Consumers are also keen to switch from traditional caffeine-based drinks to flavored tea extracts.
The key players in this market include ADM (US), Dupont (US), Kemin Industries (US), Givaudan (Switzerland), and Synthite Industries Ltd (India). New product launches, expansions & investments, and collaborations were some of the core strengths of the leading players in the tea extracts market. These strategies were adopted by the key players to increase their market presence. It also helped them diversify their businesses geographically, strengthen their distribution networks, and enhance their product portfolios. Some of the other players in the tea extracts market include Synergy Flavors (US), Frutarom (US), Finlays (UK), A.Holliday & Co. (Canada), Martin Bauer Group (Germany), Indena SPA (Italy), Futureceuticals (US), Amax Nutrasource Inc. (US), Cymbio Pharma Pvt. Ltd. (India), Teawolf (US), Phyto Life Sciences Pvt Ltd. (India), Taiyo International (Japan), AVT Tea Sources Ltd. (India), Halssen & Lyon GMBH (Germany), and Harrisons Tea (India).
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Archer Daniels Midland (US) is one of the major players in the global tea extracts market. It is a US-based producer of tea extract-based products for various applications, such as food & beverages and supplements. ADM operates in the tea extracts market through its subsidiary, WILD Flavors, and Specialty Ingredients (US). Its product portfolio consists of natural flavor ingredients, concentrates and blends, oral care, ready-to-market-concepts, foodservice, and dairy. The company offers black tea, green tea, and white tea extracts to different industries, such as food, beverage, and pet food. Tea extract products are included in ADM’s nutrition segment. The company operates in North America, Europe, Middle East & Africa, Asia Pacific, and Latin America.
Dupont (US) is one of the major players in the tea extracts market. The company offers various types of tea extract-based food & beverage products. It offers clean-label ingredients, and the focus of the company is providing various tea extract-based products. The main strategy opted by the company was to launch new products, due to which the company is focusing on establishing itself as an innovative brand and gaining a foothold in the US tea extracts market.
