Infant formula containing beneficial microbes will attain a market size of $17.3 billion, growing at a CAGR of 28% from $1.45 billion in 2014, Lux Research says
BOSTON, MA – April 21, 2015 – Probiotics are poised to storm the infant formula market, with probiotic-containing formula jumping nearly 11-fold in revenue to claim a whopping 76% share of the $22.9 billion market in 2024, according to Lux Research.
Probiotics are live microorganisms that contribute to the population of beneficial microbes in the human gut, which are crucially linked to the proper functioning of the human metabolism. A myriad of probiotics occur naturally in human breast milk and are now thought to have essential functions in the optimal development of infants. In the quest to mimic human breast milk, probiotics have emerged as a vital ingredient of infant formula.
“Probiotics represent an exciting opportunity across diverse markets from infant formula to targeted elderly nutrition and all markets in between,” said Camilla Stice, Lux Research Analyst and the lead author of the report titled, “Harnessing the Microbiome for a Better Future: Probiotics Storm the Infant Formula Market.”
“Probiotic science and enabling technological developments are evolving rapidly, and developers must stay on top of the latest research so as not to miss crucial discoveries in this fast-moving field,” she added.
Lux Research analysts developed a forecasting model for probiotic infant formula over the next decade. Among their findings:
- Global falling birth rates will marginally reduce volume. Currently an estimated 78 million infants between birth and the age of six months are under the care of infant formula and numerous factors such as convenience, lifestyle, insufficient breast milk supply, disease and infection, and cultural stigmas drive the infant formula market. However, falling global birth rates will cause the total market by volume to fall -0.1% CAGR over the next decade.
- Probiotic infant formula commands price premium. Probiotic infant formula already on the market – such as Nestle’s Good Start with the probiotic Bifidobacterium lactis and Mead Johnson’s Nutramigen with Lactobacillus GG – command a 20% price premium over conventional products. The price premium will help offset lower volumes and raise the overall market size to $22.9 billion in 2024, from $20.5 billion in 2014.
- R&D will drive further advances. Currently, industry focus remains on incorporating single probiotic strains. However, formulators must begin developing optimal combinations of specific probiotic strains with tailored prebiotic compounds that deliver synergistic beneficial effects, further increasing the value of probiotic infant formula.
The report, titled “Harnessing the Microbiome for a Better Future: Probiotics Storm the Infant Formula Market,” is part of the Lux Research Food and Nutrition Intelligence service.