Functional “Phoods” to Become $39 Billion “Niche”

New York, March 13, 2007 — “Phoods” and “Bepherages” — packaged foods and beverages providing a positive pharmaceutical benefit beyond basic nutrition by virtue of their inclusion of medically beneficial ingredients — are growing into a huge “niche” market estimated at nearly $25 billion in 2006 and destined to touch $39 billion by 2011, according to Functional, Fortified and Inherently Healthy Foods and Beverages: The U.S. Phood Market, a new report from market research publisher Packaged Facts.

During the five-year period from 2002 to 2006, mass-market sales of phoods grew by 30%, and the report estimates that annual percentage gains will likely remain at 10% over the next two years, but then maintain a steady 9% growth rate thereafter.

RTE cereal, which comprises the largest percentage of the total phoods/bepherages market at nearly a third, also commands nearly 60% of the total RTE cereal market, exemplifying the heavy competition phoods and bepherages are wielding upon the overall mainstream market. Functional refrigerated teas, food bars, yogurts, and bottled waters all made healthy inroads into the market share of their conventional competitors.

Phoods are seen as an excellent alternative delivery system for many of the nutritional supplements already being taken by the masses. Indeed phoods may be eating into the vitamin/neutraceutical market as well.

“During the next few years, the largest increases in nutraceutical ingredient demand are expected to be for glucosamine, probiotics and sterol esters, whey protein, omega-3 fatty acids, and Co-Q10, all key drivers in the nutraceuticals market,” said Don Montuori, the publisher of Packaged Facts. “Consumer demand for functional foods is skyrocketing and we expect that greater consumer awareness of the benefits of these foods will stimulate market growth beyond our estimates.”

Along with a comprehensive assessment of functional foods and consumer trends driving the market, The U.S. Phood Market addresses key nutrients, the status of government regulation of food and beverage health claims, and issues such as obesity and the new Food Guide Pyramid impacting the market. The report is available from Packaged Facts by visiting: http://www.packagedfacts.com/Functional-Fortified-Inherently-1282385. It is also available at MarketResearch.com.

About Packaged Facts
Packaged Facts, a division of MarketResearch.com, publishes market intelligence on a wide range of consumer industries, including consumer goods, food and beverage, and demographics. For more information visit www.PackagedFacts.com, or contact Tom Ehart at 240-747-3014, or tehart@marketresearch.com.