The Global Spices Market is projected to register a CAGR of 4.33% and reach a value of USD 19,960.8 million by 2028. A spice is a seed, fruit, root, bark, or other parts of plant, which is primarily used for flavoring, coloring or preserving food products. Many spices have antimicrobial properties. Some of the common spices available in the market are chili & pepper, cinnamon, nutmeg, ginger, cardamom, clove, and cumin, among others. The global spices market is expected to grow at a notable pace during the forecast period. The growth can be attributed to the growing preference for packaged spices and rising popularity of cross-cultural cuisines. Also, growth of the foodservice industry boosts the market growth. Moreover, the increasing demand for organic spices and growing awareness regarding medicinal properties of spices are expected to create lucrative growth opportunities for the market players. However, volatile commodity prices is expected to be the major factor hampering the growth of the global spices market during the assessment period.
COVID-19 Impact Analysis
The COVID-19 pandemic has adversely affected and is expected to continue to pose risks to the spices business. There are numerous risks related to the outbreak of the COVID-19 pandemic. COVID-19 spread across the globe during 2020 and continues to impact economic activity around the globe. COVID-19 caused disruption and volatility in the global capital markets and authored an economic slowdown during 2020. The COVID-19 pandemic and its associated economic uncertainty negatively impacted the Spices Market in most geographies and across a variety of customers. In regards to COVID-19, governments around the world have introduced certain measures, such as travel prohibitions, shutdowns of certain businesses, bans on group events and gatherings, shelter-in-place orders, curfews, and recommendations of practicing social distancing. These restrictions have resulted in weakening activity and temporary closures of manufacturing facilities.
The global spices market is expected to register a notable growth rate of 4.33% during the forecast period. The increasing demand for packaged spices and rising popularity of cross-cultural cuisines are driving the growth of the market. Also, the growth of foodservice industry drives the market growth. Moreover, increasing awareness regarding the medicinal properties of spices and demand for organic spices offer significant growth opportunities to market players. However, volatile raw material prices are expected to restrain the growth of the market.
In developing countries such as India, China, and Bangladesh consumers have traditionally purchased loose spices. However, in the past decade there has been a shift with consumers emulating those in developed countries, resulting in a rise in the demand for packaged and branded spices. The increasing per capita disposable incomes have made packaged spices affordable for all consumer groups. Moreover, the increasing working population with limited time for cooking is boosting the demand for on-the-go convenience foods, which is significantly contributing to the growing demand for packaged spice products owing to their convenience. Consumers are also becoming aware of the benefits of packaged spices over loose spices such as low chances of adulteration, increased shelf life, and quality assurance. This has increased the adoption of packaged spices across the globe. Moreover, many spice products manufacturers are working on brand building and increasing brand recognition among consumers. For instance, McCormick & Company started emphasizing health over flavor and the India-based MDH Spices promotes its spice products based on the origin of raw material. Market players are also focused on innovative packaging and attractive packaging has shifted consumer focus to packaged spices. Thus, with the growing consumer preference for convenience and high-quality products the demand for packaged and branded spices products is increasing across the globe.
The prices of various spices are constantly fluctuating as they depend on production and demand. The major spice-producing countries are concentrated in Asia and South America. Asia was the largest spice-producing region in 2018 with vast quantities exported to North America, Europe, and the Middle East. Globally, spice production is highly volatile is largely affected by environmental factors, such as rainfall, floods, and draughts, creating a gap in demand and supply. Commodity prices also depend on factors such as petroleum prices, food stock levels, and currency exchange rates. For instance, according to Spice Board India, the average spot prices of black pepper have seen a decline from USD 4.66\lb in 2014 to USD 1.30\LB in 2019 whereas cinnamon prices have risen from USD 4.70\lb in 2014 to USD 6.50\lb in 2019.
Consumer awareness across the globe is rising with regard to the environmental and health impact of chemicals during food cultivation. Due to the increasing awareness regarding the negative impact chemicals can have on human health, consumers are shifting toward the use of organically cultivated and processed products. Thus, the global demand for organically produced foods is growing rapidly. According to MRFR analysis, the global sales of organic food have increased by ~USD 82.0 billion from 1999 to 2017. This is further influencing the demand for natural and organic food ingredients. Along with North America and Europe, the adoption of organic food ingredients is increasing in Asia-Pacific, the Middle East, and Africa. Consumers in these regions are becoming aware regarding the benefits of organic products, which creates a lucrative opportunity for the manufacturers of organic spices.
The spices market is fragmented with a large number of small and regional players operating in the market. There is stiff competition among these players with limited product differentiation. Moreover, the small and regional players have a strong hold on the market owing to their widespread presence, low prices, and conventional and established consumer bases. Consumers are reluctant to switch from traditionally used products as they have first-hand experience of product quality. Also, most consumers are price-sensitive, which further poses a challenge to the organized brands in establishing their dominance in the unorganized market
Based on type, the Global Spices Market has been segmented into Garlic, Ginger, Turmeric, Cumin, Cinnamon, Pepper and Others. The pepper segment accounted for the largest market share of 9.89%, in 2020. However, the ginger segment is expected to exhibit the highest CAGR of 4.91%.
Based on category, the Global Spices Market has been segmented into conventional and organic. The conventional segment accounted for the larger market share of 77.80% in 2020 whereas, the organic segment is projected to exhibit the higher CAGR of 4.91%.
Based on form, the Global Spices Market has been segmented into whole, ground/powder and others. The ground/powder segment accounted for the largest market share of 54.60% in 2020 and is expected to register the highest CAGR of 4.42% during the forecast period.
By End Use
In terms of end use, the Global Spices Market has been divided into food retail, foodservice and food processing. The food retail segment accounted for the largest market share of 73.73% in 2020. However, the foodservice segment is projected to exhibit the highest CAGR of 4.79%.
Global Spices Market Share, by Region, 2020 (%)
Sources: MRFR Analysis
By region, the Global Spices Market has been divided into North America, Europe, Asia-Pacific, South America and the Middle East & Africa. Asia-Pacific accounted for the largest market share of 46.64% in 2020. Europe was the second-largest market in 2020 and is projected to exhibit a CAGR of 4.06% during the review period. The market in Middle East & Africa is expected to register the highest CAGR of 4.82% during the forecast period.
Asia-Pacific accounted for the largest share of the global market in 2020 and is expected to maintain its dominance with the highest CAGR of 4.51% during the forecast period. Asia is known as the “Land of Spices” as it is the place of origin, production, consumption, and export of most of the spices. India is the leading market, both in terms of spices production and consumption. India held approximately 22.38% share of the global spices market in 2020 followed by China. Almost every country in Asia-Pacific produces spices and has a high consumption of the same. Traditionally, spices have been an integral part of various Asian cuisines, which is majorly driving the growth of the spices market in this region. The growing population and urbanization are the other factors driving the growth of the regional market. The growing brand awareness and growth of the organized retail sector in the developing countries are also expected to support the growth of the spices market in the region. The growing adoption of cross-cultural cuisines followed by increasing demand for exotic and authentic flavors has increased the sale of different spices in the region. This is also attracting various international brands to expand their presence in Asia-Pacific.
Europe was the second-largest market for spices in 2020 with a market share of 24.01%. Germany, the UK, and France are the major contributors to the growth of the spices market in the region. Growing population and changing lifestyles play a vital role in driving the growth of the regional market. The spices that are majorly consumed in the region are pepper, paprika, pimento, and cinnamon, among others. Globalization has inspired consumers to search for new flavors. This has influenced several European manufacturers to introduce spice blends of cross-cultural cuisines. Moreover, the increasing health-conscious has increased the demand for spices such as ginger and turmeric in their regular diet, which exhibit beneficial properties. Also, the increasing vegetarian and vegan population are inclining toward the consumption of a variety of spices along with plant-based protein to make the food look and taste like meat. The trend followed by the manufacturers in the European spices market is offering products in small packaging.
The market comprises tier-1, tier-2, and local players. The tier-1 and tier-2 players have a global reach and diverse product portfolios. Companies such as McCormick & Company, Inc. (US), Frontier Co-op (US), Colorado Spice (US), SpicesInc.com (US), and The Watkins Co. (US) dominate the global market due to brand reputation, product differentiation, financial stability, and diversified regional presence.
Prominent players in the Global Spices Market include McCormick & Company, Inc. (US), Frontier Co-op (US), Colorado Spice (US), SpicesInc.com (US), The Watkins Co. (US), Organic Tattva (India), Organic Spices Inc (US), Sauer Brands, Inc (US), B&G Foods, Inc (US), Terana, SA (Mexico) and TAJÍN (Mexico ).
Few developments that occurred in recent times influencing the market growth of Spices are listed below:
Scope of the Report
Global Spices Market, by Product Type
Global Spices Market, by Category
Global Spices Market, by Form
Global Spices Market, by End Use
Global Spices Market, by Region
|Market Size||USD 19,960.8 million|
|Forecast Units||Value (USD Million)|
|Report Coverage||Revenue Forecast, Competitive Landscape, Growth Factors, and TrendsRevenue Forecast, Competitive Landscape, Growth Factors, and Trends|
|Segments Covered||by Type, Category, Form, End Use and region|
|Geographies Covered||North America, Europe, Asia-Pacific, and Rest of the World (RoW)|
|Key Vendors||McCormick & Company, Inc (US), Frontier Co-op (US), Colorado Spice (US), SpicesInc.com (US), The Watkins Co. (US), Organic Tattva (India), Organic Spices Inc (US), Sauer Brands, Inc (US), B&G Foods, Inc (US), Terana, SA (Mexico), and TAJÍN (Mexico).|
|Key Market Opportunities||Demand for organic spices|
|Key Market Drivers||
Spices Market valuation would be USD 19,960.8 million 2028.
Spices Market CAGR would be 4.33% during the forecast period.
Categories included in Spices Market report are conventional and organic.
The APAC Spices Market would dominate the market.
India would register the highest CAGR in the APAC Spices Market.