Product Profile: Food Colouring Agents

HS codes: 320300 and 32041990.
• Food colours are amalgamated and mixed to processed food items or beverages to boost their appeal.
• Global market of food colour/food colouring agents/powders is valued at US$ 2.1 billion in 2018. It is projected to reach US$ 3.2 billion by 2023, registering a CAGR of 9.8% from 2019 to 2023.
• India’s exports of food colour increased from US$ 203 million to US$ 263 million in past five years with a CAGR of 6.5%.
• Major economies where India exports food colour are US, China, UK, Indonesia, Brazil, Mexico and Italy. India itself is an emerging market for food colorants.

The global market of food colouring agents is projected to reach US$ 3.2 billion by 2023, registering a CAGR of 9.8% from 2019 to 2023. Food colors are amalgamated and mixed to processed food items or beverages to boost their appeal. Dyes and pigments are the most common colouring agents, which are used for food items and beverages in liquid, liquid gel, gel paste, and powder form. The initial usage of colorants for agricultural produce and foods is proposed to have occurred in Egyptian cities as early as 1,500 BC, when toffee and candy makers added natural extracts and wine to improve the products’ appearance.

Factors driving the global food color market is their ability to strengthen product appeal and growth in awareness about the beneficial effects of natural colors. To explain this with an example, betanin, which is a natural food colorant, is used for its antioxidant properties. Similarly, red sandalwood offers wound healing properties and is used in ayurvedic treatment.

World exports of food coloring agents, in US$ billion

Trade of food colouring agents surged from US$ 1.45 billion in 2014 to US$ 1.76 billion in 2018 at a CAGR of 5.5%. Top exporting countries of food colours are China, Netherlands, Denmark, US, Spain, Germany, Italy and Peru. Similarly, top importers of the said product are USA, Japan, Germany, UK, France, Mexico and Italy.

There are several reasons for utilizing food colours:

• Make more appealing, appetizing, attractive and informative
• Provide color to colourless and “fun” foods
• Offset color loss
• Correct natural variations in color
• Enhance colors that occur naturally
• Allow consumers to identify products on sight, like candy flavors or medicine dosages

Global food colorants market by application

Product Insights

Natural food colors are evaluated to be the largest product segment accounting for over 80% of the total global market revenue. Current world demand for this product is rising substantially owing to the burgeoning awareness among salubrious consumers regarding the health benefits associated with natural food colors.

The market for synthetic food colors is also anticipated to surge on account of growing product use by consumers across developing economies. Corroborating this, the demand for synthetic colors, such as blue and green, is expected to be driven primarily by their use in beverage manufacturing industry. Synthetic food colours are also known as artificial colours. They are manufactured by chemical reaction and are commonly used in food and pharmaceutical industries. Some of the common food colours are allura red, brilliant blue, tartrazine, sunset yellow, quinoline yellow, and indigo carmine.

Application Insights

Carbonated beverages and non-alcoholic beverages are anticipated to experience one of the highest growth rate of 6.4% from 2019 to 2023 factored due to accelerating disposable income and economic development. In addition, rising demand for ready-to-drink beverages is expected to translate into heightened demand for the product, leading to industry growth.

The market is influenced by easily available raw materials, which includes fruits & vegetables. Growing food safety concerns in the global food markets are pressurizing manufacturing to adopt clean labels. The strict food standards regulations by several regulatory bodies like USFDA and European Commission is proving to be a constraint for manufactures, thus forcing them to look at alternatives in the form of innovations in natural colourants. Asia-Pacific is estimated to see a high CAGR mainly attributed to rising economies and increasing consumption of processed foods. The Asia Pacific food and beverages colorants market is dominated by Australia and New Zealand, followed by Japan and China.

India’s Trade Performance

India’s exports of food colouring increased from US$ 203 million to US$ 263 million in past five year with a CAGR of 6.5%. Major economies where India exports food colour are USA, China, UK, Indonesia, Brazil, Mexico and Italy. India is an emerging market for food colorants. Indian food quality needs to get aligned with the food colouring requirements of major importing nations to escalate our exports.

Whether it is natural or synthetic, the key thing is to meet the desired specifications of the product as stipulated by regulation. There are a set of regulations according to FSSAI-the Indian regulatory body for the use of food colors in different foods that can still facilitate the standards to converge with CODEX.