The
global baking powder market is consolidated with the majority of the
revenues being shared by companies such as Clabber Girl Corporation,
ACH Food Companies Inc., and Caravan Ingredients, Inc. Promising
players such as Weikfield and Hansells Food Group are conducting
forward and backward integration to take advantage of economies of
scale and reduce the production cost. Transparency Market Research
(TMR), in its new study, reports that many companies are supplying
products to smaller retailers at lower prices, further intensifying
the competition.
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Major
buyers of baking powder include hypermarkets, supermarkets, and
industrial buyers for making pizzas, burgers, and breads. Big
retailers such as Wal-Mart and Tesco are buying baking powder
directly from manufacturers in bulk, thus enjoying economies of scale
in the market by eliminating distributors in the supply chain. Since
the consumption of baking powder by the end consumer is very less,
manufacturers are channelizing their products through wholesalers or
retailers. Thus, the bargaining power of buyers is expected to be
high in the coming years.
Changing
Food Habits Drive Demand for Baking Powder
The
urbanization of population has brought many changes in the food
habits and consumption patterns of people. A radical shift in the
socio-cultural behavior due to cultural borrowing has led to nuclear
families and rise in the number of working women. Moreover,
increasing disposable income has also led to a rise in the demand for
baking powder-based food such as waffles, cakes, pastries, donuts,
pizzas, and burgers. “An increasing consumption of junk food owing
to busy lifestyle is thus behind the growth of the global
baking powder market,” states a TMR analyst.
Owing
to increased awareness regarding health and wellness, the consumer’s
demand for a well-balanced meal are met through high fiber breads,
nutrition bars, and breakfast cereals. These health and wellness
oriented food products require baking powder as an ingredient, thus
driving their demand.
Substitution
by Baking Soda to Threaten Demand for Baking Powder
Baking
soda is partly baking powder and soda. Although they differ in their
chemical composition, the products can be substituted for each other
owing to their similar properties. Baking soda is stronger and has a
longer shelf life than baking powder. Moreover, the consumer
awareness regarding the difference between the two products is very
little. Thus, the substitution of baking powder by baking soda is
restraining the growth of the baking powder market.
Another
factor challenging the demand for baking powder is the growing
awareness among people regarding the adverse effects of consuming
junk food such as cakes, burgers, and pizzas. The rising concern
regarding the high fat, calorie, and sugar content in junk food and
the lack of vitamins, proteins, and minerals in these foods are
discouraging people from consuming them. The baking powder market is
thus expected to receive a major setback owing to a decline in the
consumption of junk food, says TMR.
Development
of Low Sodium Baking Powder Improves Public Health, Boosts Demand
Although
sodium intake is important for the human body, excess of it can lead
to dehydration, hypertension, high BP, and even heart failure. Owing
to the diet pattern of people living in Europe and North America,
sodium as high as 75% is being ingested by consumers. Thus,
manufacturers and governments are concentrating on product innovation
to help reduce sodium content in baking powder, without affecting the
quality. Such initiatives to improve public health and save major
health-related costs, will result in product innovation and
differentiation, thus creating opportunities of growth in the market.
According
to the report, the global market opportunity in baking powder is
expected to rise from US$2.72 bn in 2015 to US$3.36 bn by 2019. On
the basis of product, the market is expected to be led by the
tartrate segment, followed by the phosphate segment. By geography,
Asia Pacific is expected to lead and account for 37.1% of the global
baking powder market by 2019.
This
information is based on the findings of a report published by
Transparency Market Research titled “Baking Powder Market - Global
Industry Analysis, Size, Share, Growth, Trends, and Forecast 2013 -
2019.”
The
global baking powder market is segmented as follows:
By
Products
- Phosphate-based Baking Powder
- Anhydrous Phosphate-based Baking Powder
- Sodium Aluminum Sulfate Phosphate-based Baking Powder
- Tartrate-based Baking Powder
- Aluminum-free Baking Powder
- Phosphate-free Baking Powder
- Others
By
Region
- Europe
- North America
- Asia Pacific
- Rest of the World
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