Tea Extract Market is expected to reach US$ 5.88 Billion by 2031

Rising Demand for Natural Ingredients in Food and Beverages Bolsters Tea Extracts Market Growth

According to our latest study on "Tea Extracts Market Size and Forecast (2021–2031), Global and Regional Growth Opportunity Analysis – by Type, Category, Form, and Application," the market was valued at US$ 3.58 billion in 2023 and is projected to reach US$ 5.88 billion by 2031; it is estimated to register a CAGR of 6.4% from 2023 to 2031. The report highlights key factors driving the market growth and prominent players along with their developments in the market.

Tea extracts are concentrated forms of the bioactive compounds found in the tea leaves. These compounds are polyphenols, flavonoids, and catechins. These extracts are derived from various types of tea, including green, black, oolong, white, and others. They are used in a variety of products, ranging from dietary supplements to beverages, cosmetics, and pharmaceuticals. The demand for tea extracts is attributed to increasing consumer awareness of health benefits associated with tea, such as its antioxidants, anti-inflammatory, and weight management properties. As consumers continue to prioritize wellness and natural ingredients, the demand for tea extracts in functional food, beverages, and nutraceuticals is growing. 

Tea Extracts Market Breakdown – by Region

Consumers are becoming aware of the adverse effects of consuming food and beverages with synthetic ingredients. Due to growing concerns about ingredient safety and potential health consequences, natural food additives are being increasingly used in various types of food and beverages. Several health organizations and food safety associations prohibit the use of various artificial flavorings in food and beverages. For instance, the US Food and Drug Administration (FDA) banned seven artificial flavors that have been associated with cancer on October 5, 2018. The FDA had advised using naturally extracted additives available in different flavors as they are a safer option. Also, the FDA prohibited eight artificial flavorings that were included in ice cream, baked goods, confectionery, and beverages. These ingredients used as flavorings have been known to cause cancer in humans.

Consumers increasingly prefer food and beverages that are free of synthetic flavors, colors, and other food additives. Herbal and naturally made products are becoming increasingly popular, owing to their perceived health benefits. Products that are free of artificial ingredients are included in the diets of many consumers, and they are willing to pay high prices for these ingredients. Further, consumers are focusing on holistic and conscious consumption of food and prefer products with ethically sourced ingredients. Tea extracts are widely used as antimicrobials, antioxidant agents, and shelf-life-extending agents in food and beverages to prevent major digestive and chronic diseases. Similarly, green tea extract, with its rich antioxidant content, is particularly favored in yogurt and drinkable dairy products, where it enhances the health profile by adding polyphenols known for their potential benefits in boosting metabolism and supporting overall wellness. Owing to increased applications in the food & beverages industry, manufacturers are significantly launching tea extracts. For instance, in November 2022, Layn Natural Ingredients, a manufacturer of botanical extract ingredients, added an instant tea extract powder line to its portfolio of tea extracts. This extract is suitable for instant tea and ready-to-drink products. Thus, the rising demand for natural ingredients in food and beverages fuels the tea extracts market growth.

The tea extracts market analysis has been performed by considering the following segments—type, category, form, and application. Based on type, the market is segmented into green tea, black tea, oolong tea, and others. The green tea segment is anticipated to hold a significant tea extracts market share by 2031.

The tea extracts market report emphasizes the key factors driving the market. Tea extracts have a wide range of applications in various end-use industries such as food & beverages, pharmaceuticals & nutraceuticals, personal care & cosmetics, and animal feed. Tea extracts are used as natural flavorings, colorants, and preservatives in food and beverages. Consumers increasingly seek clean-label products, driving the demand for natural ingredients such as tea extracts in food products. Also, there is an increasing demand for various herbal and botanical extracts in the beverage industry.

In terms of revenue, Asia Pacific dominated the tea extracts market share in 2023. China presents a major market for tea extracts in Asia Pacific. The China tea extracts market is a vast and rapidly growing industry driven by rich tea culture. China is the world's largest tea producer and consumer. The market is characterized by a strong preference for high-quality tea extracts, particularly in traditional Chinese medicine and the pharmaceutical industry. Chinese manufacturers such as Tongrentang and Yunnan Baiyao used tea extracts to create medicine products such as tea-based supplements and tea-infused health tonics. Furthermore, China's thriving food and beverages industry, led by companies such as Hangzhou Wahaha Group and Nongfu Spring, is constantly seeking new and exciting ways to incorporate tea extracts into products, driving growth and innovation in the market.

The tea extracts market trends include the rising demand for tea extracts in the nutricosmetic industry. Consumers across the globe are shifting toward the adoption of a healthier lifestyle. Natural flavors can satisfy consumers' dietary requirements. Descriptions on menus and labels on food packaging highly influence consumer preferences. An understandable and clear label with thorough ingredient information attracts consumers to buy products. Companies' claims of natural ingredient content in the product on the front of the packaging might attract a large number of consumers. Clean-label products are becoming increasingly popular as consumers prefer 100% natural products without the presence of synthetic ingredients such as preservatives, artificial colors, flavors, etc. Virginia Dare Extract Co and Florida Food Products, Inc are among the companies that offer clean-label tea extracts.

Botanic Healthcare Pvt Ltd, Finlays, Martin Bauer GmbH & Co KG, Firmenich International SA, Givaudan SA, International Flavors & Fragrances Inc, Kerry Group Plc, Sensient Technologies Corp, and Kemin Industries Inc are among the prominent players profiled in the tea extracts market report. These market players are focusing on providing high-quality products to fulfill customer demand. They are also adopting strategies such as new product launches, capacity expansions, partnerships, and collaborations to stay competitive in the market. The tea extracts market forecast can help stakeholders plan their growth strategies.

The tea extracts market is segmented on the basis of type, category, form, application, and geography. Based on type, the market is segmented into alpha, beta, gamma, delta, and complex. In terms of category, the market is bifurcated into organic and conventional. Based on form, the market is divided into dry and liquid. By application, the market is segmented into food & beverages, dietary supplements, personal care and cosmetics, and others. The food & beverages segment is further segmented into bakery & confectionery, dairy & frozen dessert, beverages, and others. By geography, the tea extracts market is broadly segmented into North America, Europe, Asia Pacific, the Middle East & Africa, and South & Central America. The North America market is further segmented into the US, Canada, and Mexico. The market in Europe is subsegmented into Germany, France, the UK, Italy, Russia, and the Rest of Europe. The Asia Pacific tea extracts market is further segmented into China, India, Japan, Australia, South Korea, and the Rest of Asia Pacific. The tea extracts market in the Middle East & Africa is subsegmented into South Africa, Saudi Arabia, the UAE, and the Rest of Middle East & Africa. The market in South & Central America is further segmented into Brazil, Argentina, and the Rest of South & Central America.

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