NATURAL FOOD COLORS MARKET ANALYSIS

Natural food colors are typically more expensive than artificial ones as producing natural colorings require extensive cultivation and processing. For example, it takes around 10,000 pounds of Red Beetroot to produce just 1 pound of natural red food color. This high input material cost gets reflected in the end product price. According to the data from the UN Food and Agriculture Organization, the average production cost of natural food colors is estimated to be 4-5 times higher than similar synthetic colors.  The higher prices make natural colors out of reach for many small to medium food producers. As natural colors add very little nutritional value to the food, using artificial substitutes provides better pricing power and margins for budget-conscious producers. Even big brands hesitate to make a full transition and prefer to use only a certain percentage of natural colors in their products to control costs.

Opportunities: Scope for product innovation using natural colors

Growing health consciousness among consumers leads to increasing demand for clean label and organic products free from artificial ingredients. Natural food colors extracted from natural sources like vegetables, fruits and other plant/animal sources offer a healthy and sustainable alternative to artificial synthetic colors.. For example, colors extracted from purple sweet potato, blueberries, carrots, tomatoes, and others not only provide vibrant hues but also contain antioxidants with added health benefits. Microencapsulation technology enables stable incorporation of delicate natural colors, increasing their utility across product categories