Functional Beverage Production in Australia - Market Research Report (2014-2029)

Smart drinking: Product innovation will drive revenue rises despite competitive pressures building

This report covers the scope, size, disposition and growth of the industry including the key sensitivities and success factors. Also included are five year industry forecasts, growth rates and an analysis of the industry key players and their market shares.

The Functional Beverage Production industry has grown steadily over the past decade. The two major producers, Coca-Cola Europacific Partners API Pty Ltd and Asahi Holdings (Australia) Pty Ltd, increased domestic production to compete with major imported energy drink brands Red Bull and V Energy. Sports drinks and health-related functional beverages have also become more popular with Australian consumers. Rising concerns about obesity and other health complications have made consumers more health-conscious, driving demand for these products. The fermented drinks segment, which includes products like kombucha, kefir and kvass, has been growing and supporting the industry's performance. Rising health consciousness, growing disposable incomes and busy lifestyles have boosted demand for fermented drinks. Fermented beverages are health drinks made by fermenting raw ingredients with microbial culture. They are purported to contain probiotics and immune-boosting properties, appealing to the health-conscious consumer. However, continued growth in total imports has dampened the industry's performance. Revenue is expected to fall at an annualised 2.3% to $597.6 million over the five years through 2023-24. This trend includes a drop of 2.1% in the current year, as inflationary pressures discourage consumers from spending on functional beverages.

Industry firms primarily manufacture functional beverages, such as health drinks, sports drinks and energy drinks.