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Where is the infant formula market headed?

Article-Where is the infant formula market headed?

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Infant formula sales to see prominent growth via e-commerce, and starting milk formulas are expected to hold over 45% of global demand. Infant formula sales will continue to be buoyed by increasing acceptance as a viable breastmilk alternative. Between 2019 and 2026, the global infant formula market is projected for significant growth at a 10% CAGR, as indicated by a new study. Rise in consumer awareness about the benefits of organic and prebiotic infant formula ingredients will further boost demand over the course of following years. Wide availability in liquid, powdered, and ready-to-use forms is another strong factor pushing sales of infant formula in the global market.

Key takeaways of the infant formula market

  • The demand for starting milk formulas, which currently accounts for more than 45% of total sales, will remain significant throughout the projection period.
  • Special milk formulas and follow-on milk formulas will exhibit double-digit CAGRs through 2026.
  • Infant formula sales volume recorded in North America and Asia Pacific, excluding Japan, would remain on a higher side, compared to other regional markets.
  • In line with heightening demand for organic baby food products, which has recently grown in popularity, infant formula with organic ingredients will witness a robust hike in demand through 2026.
  • Pharmacy stores hold over three quarters of global infant formula sales, followed by supermarkets. By the end of the forecast period, online sales will be exhibiting a substantial growth rate.
  • Introduction of innovative packaging formats in infant formula, such as clean label packaging, is a key factor impacting the sales of baby food products. Manufacturers are also investing heavily in the development of eco-friendly packaging alternatives for infant formula.
  • The global trading standards for infant milk were set by the Codex Alimentarius in the 1980s. The type and nutrient level standards are similar across the legislature of the major market. However, the permitted ingredients and labeling restrictions may vary.

Europe maintains its position as the world’s largest manufacturer and exporter of infant formula. Germany holds a leading market share, followed by France, Ireland, and the Netherlands. Currently, significant demand for infant formula is coming from Chinese companies that continue to invest hefty amounts in imports of infant formula. Chinese government’s efforts in curtailing infant formula imports however may change the entire scenario.

Leaders holding 50% market share

Some of the key players in the global infant formula market include Nestlé S.A., Groupe Danone, Mead Johnson Nutrition, The Kraft Heinz Company, Beingmate Baby & Child Food Co. Ltd., Abbott Nutrition, Synutra International, Inc., Meiji Holdings Co. Ltd, Pfizer Inc., and FrieslandCampina. Among these companies, Nestlé, Danone, Mead Johnson, Abbott, and Heinz collectively hold approximately 50% of the global market value of infant formula. An emerging group of Chinese firms is now challenging the current market players by entering into joint ventures with western market leaders.

These insights are based on a report on Infant Formula Market by Future Market Insights.