Global Xanthan Gum Market to surpass US$ 507.6 million by 2025

Posted by anagha on February 2nd, 2018

Xanthan gum is a polysaccharide, commonly used as a food additive, stabilizer, and thickening agent. Xanthan gum, as a stabilizing agent, prevents the separation of food ingredients and is majorly used in gluten-free bakery products. Xanthan gum is highly soluble in cold as well as hot water, and is capable of absorbing more water in excess to its own weight, thus forming a gel. These solutions are associated with various properties such as pseudoplasticity, high viscosity, and inertness towards a wide range of pH, temperature, and electrolyte variations.

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Xanthan being a non-hazardous additive, which is associated with various nutritional characteristics, along with high carbohydrates and fiber content, has its wide application in the food and beverages industry. Increasing demand for food and beverages is in turn, propelling growth of the xanthan gum market. Furthermore, growing demand for gluten free food products, growing inclination towards convenience food, and the multi-functionality of xanthan gum are some of the other factors contributing to growth of the global xanthan gum market.

Availability of substitute products such guar gum coupled with the high cost of xanthan gum pose as major restraints for growth of the xanthan gum market. Moreover, anti-dumping policies associated with xanthan gum also hinder growth of the xanthan gum market.

In terms of revenue, North America held a dominant position in the market in 2016, accounting for a share of over 35% and is expected to retain its dominance throughout the forecast period. This is mainly due to the growing oil & gas industry coupled with the high demand for petroleum. Xanthan gum is extensively used to confer thickness to the drilling mud in the oil & gas industry. The U.S. holds the major market share for xanthan gum in North America, as the country has the longest history of oil and gas production, dating back to the 1850’s, thus making it the largest consumer of oil and natural gas in the world. According to the Energy Information Administration (EIA), in 2015, US production of natural gas increased for the tenth consecutive year with a rise of 4% from 2014. This indicates the rapid growth of the oil & gas industry in the region, which in turn is driving growth of the xanthan gum market in the region. Furthermore, growing awareness about health benefits of xanthan gum is propelling demand for xanthan gum in North America.

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Asia Pacific is expected to be the fastest growing market for xanthan gum, witnessing the highest CAGR of 4.09% during the forecast period (2017 – 2025), owing to robust growth of the food processing industry in the region. Moreover, the rapidly growing pharmaceuticals industry, which is majorly driven by the rising geriatric population is expected to boost growth of the xanthan gum market in Asia Pacific. According to World Bank, growth rate of the geriatric population in East Asia is faster as compared to other parts of Asia Pacific. In 2010, over 211 million residents were recorded under the category of geriatric population in East Asia, out of which, China accounted for 130 million residents. Furthermore, developments in infrastructure and adoption of modern technologies for oil & gas production in emerging economies such India and China are expected to drive growth of the xanthan gum market in the near future.

Among end users, the food and beverage segment held a major market share in 2016 and is expected to retain its dominance throughout the forecast period. Wide application of xanthan gum in gluten-free bakery products such as cakes and pancakes, cookies, salad dressings, quick breads, and muffins, is one of the major factors driving demand for xanthan gum in the food and beverage industry, in turn boosting market growth.

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