Label claims now shape purchasing decisions. “Natural,” “clean label,” and “no artificial flavors” are marketing phrases with measurable commercial outcomes. That reality has pushed manufacturers and flavor houses into a strategic quandary: synthetic flavors remain cheaper and more consistent, but natural and bio-derived solutions command higher trust and often higher margins.

In 2023, the food flavors industry was projected to be worth $15.66 billion (USD billion). By 2035, the food flavors market is projected to have grown from 16.28 billion USD in 2024 to 25 billion USD. It is anticipated that the Food Flavors Market would grow at a CAGR of approximately 3.97% between 2025 and 2035.

Market Research Future’s segmentation of the food flavors space highlights this shift. Their reports quantify how natural flavors have become a dominant and fast-growing slice of the market, and they show distinct valuation splits between natural and synthetic segments across regions. 

Synthetic options still have clear technical advantages. They are reproducible, cost-efficient, and often essential in high-volume commodity applications where margin sensitivity is high. However, modern consumers equate “natural” with safer, better-for-you, and more ethical — and they are willing to pay a premium. That willingness creates a clear path to margin improvement for brands that can credibly deliver natural flavor claims.

A promising technical solution is fermentation-derived and “natural-identical” molecules: compounds that are chemically identical to those found in nature but produced via biotech routes rather than extraction from scarce botanicals. These solutions can offer the best of both worlds: label friendliness, stable supply, and lower environmental footprint compared with some conventional extraction routes. MRFR’s coverage of natural flavors and related subreports highlights rising investor and industrial interest in these routes. 

Get a Quote - Request a price quote for the report or specific research services.

For product teams, making the choice requires mapping where a product sits on two dimensions: margin sensitivity and brand trust requirement. High-trust, high-margin SKUs — premium dairy analogs, baby foods, functional beverages — should prioritize natural or fermentation-derived solutions. Lower-margin, high-volume lines can maintain synthetic approaches while the company incrementally develops natural ranges.

Ultimately, the category will likely support a hybrid ecosystem. Synthetic molecules won’t disappear overnight, but the center of gravity is shifting toward natural, traceable, and sustainable natural flavors solutions. Brands that plan a phased migration — combining supply-chain hedging, consumer education, and targeted premiumization — will extract the most value from this transition.