The citrus market is on the rise, as consumers look to get their vitamin C fix. New data show the citrus category across all varieties saw increased demand in 2020, with more than 20% increases year over year.
The citrus flavors market is expected to reach $1.4 billion by 2030 as demand gradually increases after initial setbacks due to COVID-19, found Persistence Market Research.
WHAT’S DRIVING GROWTH?
Last year, Sunkist Growers commissioned a study to learn why citrus sales were more popular than ever, reported The Produce News (Jan. 13). The study found that 58% of those buying more citrus were doing so because of health reasons, looking to get more vitamin C in their daily routine.
Data from Information Resources Inc. show the citrus category saw increased demand in 2020, with more than 20% increases. Across the U.S., orange sales have seen a 37% increase, lemons have seen a 19% growth, and grapefruit is seeing a 12% increase.
Looking ahead, the beverage industry is expected to hold the highest volume of share at approximately 55%, the Persistence Market Research report found. The demand can be attributed to how consumers are looking for high-quality beverage products formulated with citrus ingredients. Demand is also expected to increase from alcoholic beverage manufacturers.
Additionally, private label will also see some expansion in the category, according to Levon Ganajian, VP of retail relations for Trinity Fruit Co. “We see the demand due to the pandemic. We see similar demand as last year and we expect the trend to continue throughout this year,” he said in The Produce News report.
WHERE IS GROWTH HAPPENING?
Regions of Europe and North America are expected to lead the global citrus flavors market, and together account for more than 50% value share. European countries, such as France, Germany, Italy, Spain, and the UK, account for 60% of Europe’s flavor market—powered by increasing consumer preference for citrus.
“The citrus flavors industry is expected to witness [the] highest growth in the region of Asia Pacific, due to [a] high number of emerging nations in this region,” said one Persistence Market Research analyst. “Key players functioning in the citrus flavors market can target this region for increased sales and profits.”
HOW ARE KEY PLAYERS STRATEGIZING?
Several key players functioning in the global citrus flavors market are investing huge amounts into research and development, as well as expanding their products. For example, in 2018, Givaudan SA invested approximately 7-8% of its revenue on research and development activities to create new and innovative flavors and fragrances for its consumers. The same year, Symrise AG also opened a new innovation creative in Shanghai, China—which is becoming the world’s largest market for flavors and fragrances.
Key players in the production of citrus flavors are also focusing on the expansion strategy to achieve faster growth, have greater impact, and occupy larger market share. Three years ago, Firmenich SA acquired Natural Flavors, Inc., a leading manufacturer of high-quality, organic-certified natural flavors for the food and beverage industry. The company is recognized as a pioneer in organic flavoring, which has enabled Firmenich to expand its product portfolio.