Functional Tea Market Research Report - Global Forecast till 2026

Global Functional Tea Market: Information By Type (Green Tea, Herbal Tea and Others), Form (Loose Leaves, Bags and Powder), Function (Immunity, Detox, Weight Loss, Gut & Digestive Health, Multifunctional and Others), Distribution Channel (Store-Based {Supermarkets & Hypermarkets, Convenience Stores, Specialty Stores and Others}, Non-Store-Based) and Region (North America, Europe, Asia-Pacific and Rest of the World) - Forecast till 2026

ID: MRFR/F-B & N/2249-CR | February 2021 | Region: Global | 110 pages

Market Overview


Global Functional Tea Market is projected to register a CAGR of 6.15% and reach USD 12,942.3 Million by 2026. Functional tea is a beverage that is infused with healthy, functional ingredients. Such types of teas are intended to provide additional health benefits. The global market for functional tea is expected to grow at a significant pace during the forecast period. The increasing demand for functional beverages and the availability of several flavor variants are expected to drive the global market during the review period. However, variations in product quality due to volatile climatic conditions and the high price of functional tea are expected to restrict the growth of the market. On the other hand, the rising demand for organic ingredients offers lucrative growth opportunities to functional tea manufacturers.


Market Dynamics


Global Functional Tea Market is expected to register significant growth during the forecast period. The key players in the global functional tea market are continuously investing in product innovation to increase their revenue sources. For instance, manufacturers have launched products with low-calorie content with different flavors to meet the rising demand for functional tea. Following the trend of new and innovative products, market players are capitalizing on the variations in tastes and preferences. They are adding several flavors to their products accordingly. The tea flavor is divided into two categories—taste (non-volatile compounds) and aroma (volatile compounds). The aroma molecules are generated from carotenoids, lipids, glycosides, precursors, and from the Maillard reaction. Market players are incorporating natural flavor blends to produce a variety of functional tea flavors such as mint, apricot, berries, orange, hibiscus, and ginger. For instance, Twinings launched a range of herbal tea blends in November 2017, including lemon delight, berry fusion, and buttermint. The launch of such innovative products is expected to drive the growth of the global functional tea market during the review period. However, climate change is restricting the growth of the global market. The key players in the global functional tea market are continuously investing in product innovation to increase their sources of revenue. Looking at the ongoing trends in the functional tea market, they have constantly been working on increasing their product variety. For instance, manufacturers have launched products that have low-calorie content with different flavors to meet the rising demand for functional tea. Following the trend of new and innovative products, market players capitalize on the variations in tastes and preferences. They are adding several flavors to their products accordingly. The tea flavor is divided into two categories—taste (non-volatile compounds) and aroma (volatile compounds). The aroma molecules are generated from carotenoids, lipids, glycosides, precursors, and the Maillard reaction. Market players incorporate natural flavor blends to produce various functional tea flavors such as mint, apricot, berries, orange, hibiscus, and ginger. For instance, Twinings launched a range of herbal tea blends in November 2017, including lemon delight, berry fusion, and buttermint. The launch of such innovative products is expected to drive the growth of the global functional tea market during the review period.


Global Functional Tea Market Revenue, By Distribution Channel, 2026 (Million USD)
Functional Tea Market


Sources: MRFR Analysis


Segmentation


On the basis of distribution channel, the global functional tea market has been divided into store-based and non-store-based. The store-based segment is further bifurcated as supermarkets & hypermarkets, convenience stores, specialty stores, and others. The store-based segment is expected to dominate the global market and reach USD 10,037.3 million by the end of 2026. In contrast, the non-store-based segment is projected to register the highest CAGR of 6.44% during 2020-2026. Consumers prefer store-based channels as they provide a one-stop shopping experience. Supermarkets are the largest sub-segment due to the increase in population, and the availability of a wide variety of products under a single roof has fueled the growth of store-based distribution channels


Global Functional Tea Market Share, By Region, 2019 (%)
Functional Tea Market


Sources: MRFR Analysis


Regional Analysis


Europe is expected to constitute a dominant share of the functional tea market during the forecast period. The region accounted for a 38.14% share of the market in 2019. The UK is among the major contributors to the growth of the regional market. The region's market is projected to register a significant CAGR of 6.30% during the forecast period of 2020 to 2026. Increasing awareness of healthy tea consumption in the region is boosting the functional tea market. The rising interest in specialty tea with enhanced flavors and superior quality among the European population is further propelling the functional tea market in the region.


Key Players


Prominent players in the global functional tea market include Tata Global Beverages Limited (India), Unilever PLC (UK), The Hain Celestial Group, Inc. (US), Dilmah Ceylon Tea Company PLC (India), Associated British Foods PLC (UK), Organic India Pvt. Ltd (India), Barry's Tea (Ireland), Harney & Sons (US), Numi Inc. (US), and Godrej Group (India).


Players operating in the global functional tea market are focusing on strengthening their geographic footprints by expansion and investing in R&D.   


Market Segmentation


Global Functional Tea Market, By Type



  • Green Tea

  • Herbal Tea

  • Others


Global Functional Tea Market, By Form



  • Loose Leaves

  • Bags

  • Powder


Global Functional Tea Market, By Function



  • Immunity

  • Detox

  • Weight Loss

  • Gut & Digestive Health

  • Multifunctional

  • Others


Global Functional Tea Market, By Distribution Channel



  • Store-Based

    • Supermarkets & Hypermarkets

    • Convenience Stores

    • Specialty Stores

    • Others



  • Non-Store-Based


Global Functional Tea Market, By Region



  • North America

    • US

    • Canada

    • Mexico



  • Europe

    • Germany

    • UK

    • France

    • Spain

    • Italy

    • Rest of Europe



  • Asia-Pacific

    • China

    • India

    • Japan

    • Australia and New Zealand

    • Rest of Asia-Pacific



  • Rest of the World (RoW)

    • Middle East

    • South America

    • Africa




Intended Audience



  • Functional Tea Manufacturers

  • Food & Beverage Manufacturers

  • Traders, Wholesalers, and Distributors

  • Governments, Associations, and Industrial Bodies

  • Investors and Trade Experts



Report Scope:
Report Attribute/Metric Details
  Market Size   USD 12,942.3 Million (2026)
  CAGR   6.15% (2017-2026)
  Base Year   2019
  Forecast Period   2027
  Historical Data   2018
  Forecast Units   Value (USD Million)
  Report Coverage   Revenue Forecast, Competitive Landscape, Growth Factors, and Trends
  Segments Covered   Type, Function, Distribution Channel
  Geographies Covered   North America, Europe, Asia-Pacific, and Rest of the World (RoW)
  Key Vendors   Tata Global Beverages Limited (India), Unilever PLC (UK), The Hain Celestial Group, Inc. (US), Dilmah Ceylon Tea Company PLC (India), Associated British Foods PLC (UK), Organic India Pvt. Ltd (India), Barry's Tea (Ireland), Harney & Sons (US), Numi Inc. (US), and Godrej Group (India).
  Key Market Opportunities   The Rising Demand for Organic Ingredients offers Lucrative Growth
  Key Market Drivers   Rising awareness Regarding Health Benefits


Frequently Asked Questions (FAQ) :


Rising awareness regarding health benefits would lead functional tea market.

The herbal segment would lead functional tea market.

The instant powder segment would dominate functional tea market.

The APAC functional tea market would dominate the global market.

Functional tea market top exporters are Sri Lanka, India, China, Kenya, and Indonesia.