Essential oils worth USD6bn
The global essential oil market size exceeded USD 6.0 billion in 2015. Increasing applications in aromatherapy coupled with rising demand for fragrances and flavors in food & beverages and personal care is expected to drive market growth over the forecast period according to Grand View Research.
Growing consumer preference for natural products has led to the development of innovative applications in personal care and beauty products. Rapid industrialization and increasing disposable consumer income are the other major factors driving the market growth, remedy mainly in developing countries such as China, viagra 40mg India, page Vietnam, and Thailand.
These naturally derived oils have no detrimental side effect unlike most conventional drugs and medicines, which is a major driving factor for the essential oil market. Increasing demand for natural personal care products and pleasant aromatic cleaning agents is expected to foster the industry growth in these applications. Growing need for aromatic flavors and fragrances in cosmetics, perfumes, as well as spa and relaxation applications is expected to fuel demand in upcoming years.
Essential oils are also widely utilized in cleaning & home products owing to their superior antibacterial and antiseptic properties. Customers are keen on specialized products as various applications require specific characteristics and ingredients.
The exorbitant amount of plant matter is required to create a single ounce of oil and increasing concerns regarding resource depletion are likely to hamper the industry over the forecast period. Manufacturers in the market have to overcome numerous challenges such as high capital costs and government certification which hinders to provide high-quality products with value for money to consumers.
U.S. essential oil market revenue by product, 2014 – 2024 (USD Million)
Orange oil emerged as the largest product segment generating USD 1,356.2 million in 2015. Rising demand in numerous applications owing to its antidepressant, diuretic, anti-inflammatory, aphrodisiac and antiseptic properties, is expected to boost the orange oil demand in upcoming years. Orange oil has also been traditionally used in fruit juices, jams, bakery products, etc.
Corn mint oil is expected to grow at a significant growth rate on account of high menthol content with several health benefits. The segment is projected to witness strong demand for medicines, food and beverages, flavors and fragrances.
The essential oil market is expected to witness tremendous growth over the forecast period with the introduction of natural and genuine products which are produced using bare essential oils. Increasing desire to benefit from naturally sourced products backed by high purchasing power and growing consumer awareness will positively impact the demand for products derived from essential oils.
Essential oils are widely utilized as flavoring and aromatic agents across diverse end-use industries including medical, food & beverages, spa & relaxation, cleaning & home, etc. These oils provide immense nutritive value to food and increase the overall appeal of products with just a few drops.
Food & beverage application segment dominated market accounting for over 34.6% of the overall volume share in 2015. Growing demand for high nutrition diet coupled with favorable government initiatives for promoting industrialization in emerging economies of BRIC is expected to impact food & beverage industry positively.
Spa & relaxation accounted for over 29% market share in 2015 owing to rising popularity of aromatherapy and other procedures. Other applications such as medical, cleaning & home products where essential oil serve as aromatic compounds and nutritive substitutes for conventional medicines are also expected to witness sustainable growth.
Europe essential oil market was valued at over USD 2.50 billion in 2015; however, the market in this region is likely to witness a steady growth rate owing to market saturation. Europe is estimated to hold the prominent market share, owing to rising awareness and growing demand for medicines, natural cosmetics and beauty products, and nutraceuticals. Increasing awareness in youth, as well as from vast geriatric population in countries such as France, Germany, UK, Spain, and Italy among others, has helped the regional industry growth.
Europe was closely followed by North America to emerge as the second major regional market. The region has highly developed industries, high per capita income, governmental subsidies and tax benefits that encourage the production and application of essential oils across diverse fields.
Asia Pacific is expected to emerge as the fastest growing region in the global industry owing to rising awareness about products derived from natural sources. Also, increasing disposable income has strengthened the essential oils? derived product demand.
The global essential oil market is highly concentrated among top industry players creating high entry barriers for new participants. Oil production is expensive owing to unique attributes and requires substantial capital investment in advanced equipment, leading to domination of numerous multinational corporations in the industry. Additionally, companies are mostly integrated along the value chain to procure raw materials as well as perform logistics operations to achieve cost benefits thus attracting new customers.
Major companies operating in the global industry include Biolandes, Sydney Essential Oils, HRF, The Lebermuth Company, Young Living Essential Oils, doTerra, Essential Oils of New Zealand, Sydella Laboratoire, Farotti Essenze, Moksha Lifestyle Products, West India Spices Inc., Falcon and Ungerer Limited. among others.
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