Modified Starch Market Dynamics: Drivers, Restraints, Opportunities & Challenges

The global modified starch market size is estimated to be valued at USD 13.1 billion in 2020 and projected to reach USD 14.9 billion by 2025, recording a CAGR of 2.7%.

It is witnessing significant growth due to increasing incorporation in a wide range of foods and cost-effectiveness offered by them, along with the enhanced functionalities they provide in comparison to native starch. The growing demand for processed and convenience food among consumers is creating a demand for modified starch. With the advancement of new technologies and innovative experiments in the food and beverage sector, the incorporation of modified starch across various industries is increasing. Asia Pacific segment is going to dominate the market due to its high production of processed food.

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Drivers: Functional properties of modified starch and their ease of incorporation in a wide range of food applications

Modified starch enables the modification of basic properties of native starch and obtaining certain functional properties suitable for a wide range of industrial applications. It has a variety of functions; it is used as a thickener, texture agent, fat replacer, and emulsifier. Modified starches, because of their characteristic of absorbing water and bulking up, render the essential mouthfeel to the food products they are used in. This makes them an excellent substitute for fat. Starch is also used as a thickener or as a gelling agent in food products, as the texture is one of the important factors for the consumers to accept the food products. Oxidized starches are used as thickeners and subsidiary gelatin agents in sauces, jellies, puddings, and ice creams. The advancement in technology used for processing starch has developed a variety of ingredients that can be customized to meet most formulating challenges.

Restraints: Limited sources and the high cost of natural additives

Modified starch is used in a range of industrial applications due to its functional properties. But, the sources from which starch is extracted are very limited, which includes corn, cassava, wheat, potato, rice, and others. The production of these sources depends on climatic conditions. For instance, the production of cassava depends on climatic conditions. Unfavorable climate hampers the overall production of cassava and leads to the fluctuation in the price of cassava.

Also, these are not only used for manufacturing starch but for other purposes as well. Corn is the largest crop produced in the US. More than 40% of the production is dedicated to non-food applications. A large amount of raw corn is used in the production of ethanol, which negatively impacts the food sector. The use of corn in ethanol production decreases its proportion in food as well as in many other non-food applications, especially as modified starch. Tapioca and wheat are also used in the production process of ethanol. Therefore, the ratio of modified starch is lower than the potential production of modified starch through various sources.

Opportunities: Untapped application of modified starch

There are various application areas that are untapped and can be big opportunities for modified starch manufacturers. Expanding the commodity sources for extracting starch and combining modification processes add a wider range of probable applications to the list.

Modified starch can act as an excellent fermentation base for the bulk production of a wide variety of biotechnology products, such as organic acids, antibiotics, vitamins, and hormones. Starch-derived glucose can be fermented to produce lactic acid, which may be polymerized for biodegradable films or bioplastics. Similarly, potato starch wastes may also be used as feedstock in fermentation reactions. Several polymers can be prepared using a variety of starch-based feedstock.

Challenges: Rising cost of raw materials

Natural sources such as wheat, cassava, corn, and rice are used as raw materials for manufacturing modified starch and its derivatives. These raw materials are used widely for the production of modified starch are also used in the production of bio-ethanol products. Increasing consumption of modified starch in segments such as food & beverages, feed, pharmaceuticals, cosmetics, and paper leads to higher demand for this starch, thereby resulting in rising in the prices of raw materials. The modified starch industry is heavily dependent on raw materials—conventional and organic raw corn, wheat, potato, and rice. The raw material prices depend on the crop plantation area and harvest from which the raw materials are obtained.

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Key Market Players:
Archer Daniels Midland Company (ADM) (US), Cargill (US), Ingredion (US), Tate & Lyle (UK), Roquette Frères (France), Avebe U.A (the Netherlands), Grain Processing Corporation (US), Emsland (Germany), AGRANA (Austria), SMS Corporation (Thailand), Global Bio-Chem Technology Group (Hong Kong), SPAC Starch (India), Qindao CBH Company (China), Tereos (France), and KMC (Denmark), Beneo (Germany), Angel Starch Food Pvt. Ltd. (India), Shubham Starch Chem Pvt Ltd. (India), Everest Starch India Pvt Ltd. (India), Sheekharr Starch Pvt Ltd. (India), Sanstar Bio-Polymers Ltd. (India), Universal Biopolymers (India), Sonish Starch Technology Ltd. (Thailand), Venus Starch Suppliers (India), and Gromotech Agrochem Pvt. Ltd. (India).

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