Demand for Flavors & Fragrances to Reach $5.3 Billion in 2012

Demand for flavors and fragrances in the US is forecast to grow 3.7 percent per year to $5.3 billion in 2012.  Increasing consumer interest in natural ingredients, which are generally more expensive than their synthetic counterparts, will support value gains.  Also, trends toward more complex and exotic flavors and scents will boost demand for new flavor and fragrance blends.  These and other trends are presented in Flavors & Fragrances, a new study from The Freedonia Group, Inc., a Cleveland-based industry research firm.

Through 2012, the cosmetic and toiletry market will continue to record the most rapid advances.  Skin care products are expected to provide strong opportunities for growth, reflecting expansion of the skin care industry itself, as middle-aged baby boomers and older adults seek anti-aging products and manufacturers continue to target growth segments with products designed for use by men, teenagers and infants. Fragrances will continue to play an important role in product differentiation, aiding demand growth.

Environmental fragrance goods will also experience healthy gains through 2012, driven by advances in aromatherapy and household applications, as well as consumer desires for more sophisticated fragrance combinations.  Candles and a host of innovative air freshener products designed to control offensive odors or simply provide a pleasant smell in the home and other living and working areas will spur demand for fragrances.  Increasingly, these products are not only being used to mask unpleasant smells, but also to create a certain ambiance through scent and provide additional benefits, such as stress relief, relaxation or energy boosting.

Despite relatively slow growth, food will remain the largest market for flavors and fragrances, based on the widespread application of flavor materials in processed food, dairy and bakery products, candy and confectioneries, and other items.  The further expansion of fortified food -- as well as beverages -- will provide opportunities, since flavors are often used to cover up the off-tastes of vitamins, minerals, antioxidants and other added ingredients.  Although beverage flavor demand will grow slowly, good opportunities remain in sports and other specialty drink markets.

The Freedonia Group is a leading international business research company, founded in 1985, that publishes more than 100 industry research studies annually. This industry analysis provides an unbiased outlook and a reliable assessment of an industry and includes product segmentation and demand forecasts, industry trends, demand history, threats and opportunities, competitive strategies, market share determinations and company profiles.