ADM Acquires Natural Citrus Flavor Ingredient Provider ZIEGLER Group

Published Date | 2019 March 19

ADM’s announcement to buy natural citrus flavor ingredient provider Zielgler group will expand their business in food additive industry which will influence the global food additive market in future timeline.

Global: US-based food processing and commodities trading company Archer Daniels Midland (ADM) has agreed to acquire European natural citrus flavor ingredients provider Ziegler Group for an undisclosed sum. Established in 1963, Ziegler is a German firm that is engaged in the production of citrus oils, extracts, concentrates and compounds for flavour, food and beverage industries. The company uses cold concentration technologies to manufacture its products that are distributed in the US, Europe and Japanese markets. The agreement to acquire Ziegler follows ADM’s recent acquisition of US-based citrus flavour provider Florida Chemical. Addition of citrus flavors cements ADM’s leadership in natural flavors for food and beverages, offering a wide variety of high-value products and solutions in areas such as vanilla and mint. The deal comes after ADM announced that it had completed the acquisition of Florida Chemical Company, US based producer and distributor of essential oils and citrus isolates for US$175 million. According to BlueWeave Consulting, Rapid urbanization, soaring population density with their increasing purchasing power and rise in food borne diseases, the consumers are becoming more health conscious and demanding for natural food additive. Food additives improve or maintain the food's nutritive value such as vitamins A, C, D, E, thiamine, niacin, riboflavin, pyridoxine, folic acid, calcium carbonate, zinc oxide and iron are often added to foods such as flour, bread, biscuits, breakfast cereals, pasta, margarine, milk, iodized salt and gelatin desserts. Instead of vitamin E, Alpha-tocopherol is used for it and beta carotene is a source of vitamin A. In addition to providing nutrients, food additives can help reduce spoilage, improve the appearance of foods and increase the availability of a variety of foods throughout the year. Coloring in the form of dyes, pigments or other substances is technically considered as food additive. These substance uses to enhance color that's lost due to storage or processing. Rising consumer awareness regarding health consciousness along with favorable government initiatives has led to extensive usage of food additives in the market. Changing lifestyle and the consumer tendency towards shifting with convenient, processed and packaged products may stimulate food additive industry in upcoming periods. According to BlueWeave Consulting’s report, Titled-“ Global Food Additive Market by Product Type (Acidity Regulators, Sweeteners, Colorants, Flavoring Agents, Emulsifiers, Food Preservatives, Anti-Caking Agents & Others), by Source (Natural & Synthetic), by Application (Bakery & Confectionery, Meat & Meat Products, Beverages, Dairy Products & Others), by Region; Size and Forecast, 2018-2025”- The global food additive market is expected to record a CAGR of 4.89% during 2018-2025 in terms of value. The market is expected to reach around USD 70 billion by 2025. This growth is driven by numerous reasons such as growing demand for processed and packaged food among consumers across the globe, coupled with technological innovation in the overall Food & Beverage industry. Moreover, Food Additive is witnessing tremendous growth due to factors as the need for convenience food like the packaged and processed food that are ready-to-cook and loaded with food additives to keep them fresh for a longer time. The demand for convenience food results for increasing disposable income and rapid urbanization in developing countries, like India & China materials.