Functional Food and Beverage Market Revenue Size, Share, and Growth Forecast 2032

Functional food and beverage items are formulated to deliver added health benefits beyond basic nutrition, often fortified with proteins, amino acids, vitamins, minerals, fatty acids, and prebiotics. Rising awareness of immune support and holistic wellness—especially following the COVID-19 pandemic—has notably strengthened demand for such enhanced nutritional offerings.

The market is categorized by product type into:

• Cereals & grains

• Dairy products

• Bakery goods

• Fats & oils

• Other fortified foods

By distribution channel, the market includes supermarkets/hypermarkets, convenience stores, online platforms, and others.
Supermarkets and hypermarkets accounted for 44.21% of global sales and 43.06% of U.S. sales in 2020, underscoring consumer preference for in-person purchasing and immediate product access.

Regionally, the market is segmented into North America, Europe, Asia Pacific, South America, and the Middle East & Africa.

Information Source: https://www.fortunebusinessinsights.com/functional-foods-market-102269 

Key Insights from the Report:

• Comprehensive regional market analyses and performance assessments

• Evaluation of growth drivers, challenges, and emerging opportunities

• Strategic profiling of major players and their business models

• Insights into changing consumer behavior and evolving product preferences

Market Drivers:

Innovation by Startups Fueling Market Expansion

The functional food and beverage market is witnessing accelerated growth due to the rise of health-focused startups offering innovative, functional, and plant-based products tailored to modern lifestyles.

Notable examples include:

• Remedy Organics (New Jersey, U.S.) – Offers plant-based beverages enriched with superfoods, probiotics, and adaptogens.

• YoFiit (Toronto, Canada) – Produces chickpea-based, non-dairy meal replacement drinks.

• Hapi Drinks (Texas, U.S.) – Develops sugar-free beverages targeting childhood obesity and type 2 diabetes prevention.

These emerging brands are transforming the functional beverage sector by addressing specific health concerns and capturing niche wellness markets.

Key Country Highlights:

Asia Pacific: Asia Pacific is expected to maintain its leading market position, supported by rising disposable incomes and increasing demand for health-centric foods across major markets such as China and India.
The regional market, valued at USD 100 billion in 2020, is projected to grow at a CAGR of 10.04% through 2028.

Europe: Strict food and safety regulations are driving R&D investments and fostering the creation of advanced functional food formulations. Growing consumer awareness about nutraceuticals and clean-label ingredients continues to shape the region’s growth.

North America: The market is expanding rapidly, driven by clean-label, naturally sourced, and fortified product demand. Increasing consumer focus on immunity, gut health, and sustainable nutrition has positioned North America as a critical growth region for functional food and beverage innovation.

Competitive Landscape:

Strategic Expansion in Emerging Regions

Global manufacturers are increasingly investing in emerging economies to capture rising demand for functional foods and beverages. Companies are focusing on product diversification, regional partnerships, and locally relevant health claims to enhance market penetration.

Key Players in the Market:

• The Coca-Cola Company (U.S.)

• Celsius Holdings, Inc. (U.S.)

• PepsiCo Inc. (U.S.)

• Glanbia Plc (Ireland)

• Nestlé S.A. (Switzerland)

• Arla Foods amba (Denmark)

• Hearthside Food Solutions LLC (U.S.)

• Tyson Foods Inc. (U.S.)

• General Mills Inc. (U.S.)

• Danone S.A. (France)

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Recent Industry Development:

December 2020: Nestlé launched a functional milk under the YIYANG Active brand in China, designed to promote muscle health, bone strength, and joint flexibility. This became Nestlé’s first product in China to receive functional food certification, marking a milestone in the brand’s health-focused innovation strategy.