Market Overview

The domestic market of Ingredients with health-promoting or functional benefits in FY2023 is estimated at 249611 million yen by gross merchandise value, which represents the increase by 2.9% from the previous fiscal year. This equates to 94,553 metric tons in terms of gross merchandise volume (up 1.0% from the preceding fiscal year). The market grew both by value and by volume, thanks to the demand increase for these ingredients for foods in general.

However, FY2024 saw a slowdown in the health foods subscription segment, triggered by issues related to red mold rice ingredients. The number of submissions for Foods with Functional Claims (FFCs) to the Consumer Affairs Agency declined, as ingredient suppliers needed to adapt to the new PRISMA2020* requirements. This caused some manufacturers to delay or suspend their FFC submissions, leading to stagnation in demand for ingredients with health-promoting or functional benefits.

Nonetheless, the overall market for such ingredients is expected to grow moderately, as ingredient suppliers increasingly shift their focus to non-FFC applications and explore new areas of use.

*As of April 2025, compliance with PRISMA2020 reporting guidelines became mandatory for FFC manufacturers conducting systematic reviews as part of their product submissions to the Consumer Affairs Agency.

Noteworthy Topics

Expanding into Foreign Markets

Demand for ingredients with health-promoting or functional benefits is rising in economically expanding regions, particularly across Asia, including Taiwan, Hong Kong, Thailand, Vietnam, and India.

Exporting to these markets requires compliance with local regulations and sensitivity to religious considerations, such as Halal. In response, suppliers are increasingly partnering with regulatory experts and local trading companies to navigate these requirements and are working toward Halal certification, which involves using halal-compliant processes and ingredients.

From the product (ingredient) perspective, demand is growing for ingredients with beauty benefits, bacterial powders such as lactic acid bacteria and bifidobacteria, and dietary fiber including oligosaccharide. While the domestic market has slowed, overseas markets are expected to play an increasingly important role for suppliers.

Future Outlook

In the health foods market, issues related to red mold rice had a negative impact on certain food products and supplement tablets, as the recalls primarily involved FFCs and supplements aimed at preventing lifestyle-related diseases. However, the overall impact on the domestic market was limited. As a result, the market for ingredients with health-promoting or functional benefits is expected to maintain steady growth going forward.

Research Outline