Global Essential Oil Market

Essential Oil Market Size Analysis

According to a recent survey conducted by ChemView Consulting, the Global Essential Oil Market grew at a CAGR of 7.6% between 2017-2021 and is estimated to be US$ 11,645.7 Mn in 2022. Currently, the market is anticipated to grow at a CAGR of 7.1% and is expected to reach a valuation of US$ 23,123.9 Mn by 2032 end.

A rise in demand from key end-use sectors like food and beverage, personal care and cosmetics, and aromatherapy is anticipated to propel the market. Essential oils offer fewer adverse effects than most conventional medications and treatments. These product characteristics are expected to be the main engine of market expansion.

Market Dynamic

THE AROMATHERAPY INDUSTRY HAS OVERALL DISPLAYED AN UPWARD TREND

Global interest in aromatherapy is growing, and this development is due to the expanding hospitality industry as well as consumer preferences for natural aromatherapy products and high-end scents. Globally, stress and anxiety levels have increased due to the sedentary lifestyle. Aromatherapy is in higher demand since it has been scientifically shown to treat diseases like these by improving mood, performance, and cognitive function.

The stakeholders utilize the functional advantages of essential oils and aromatherapy within the supply side. The fragrance industry has simultaneously transitioned from traditional perfume to the self-care and wellness sector. Additionally, the wellness business incorporates cosmetics and skin care products, and aromatherapy is evolving into a vital aspect of wellness, fragrance, and beauty.

SIDE EFFECTS DUE TO UNAPPROPRIATE DOSAGE HAMPER MARKET

Due to their high concentration of active ingredients, essential oils provide several advantages even when used sparingly. However, essential oils are linked to several adverse effects due to their extremely concentrated and volatile nature.

Most essential oils are safe; nonetheless, they must be used cautiously and according to the proper guidelines. Essential oil side effects primarily happen when users don’t follow the correct application protocol.

DEVELOPING COUNTRIES ARE EXPECTED TO EXPERIENCE AN INCREASE IN DEMAND FOR ESSENTIAL OILS OVER THE COMING YEARS

The popularity of essential oils among consumers is rising quickly, and marketing initiatives are designed to showcase their use and alleged health benefits. In the upcoming years, it’s anticipated that demand for essential oils will rise in developing nations like China and India.

Population expansion contributes to the rising demand for food, beverages, and cosmetics. In economically underdeveloped nations, the need for essential oils is anticipated to increase gradually, while it is expected to grow exponentially in new & rising markets in Asia Pacific nations. The high demand would benefit suppliers, as would the low cost of extraction.

Market Segments Covered in Report

By Type:

• Citrus
• Eucalyptus
• Lavender
• Rosemary
• Tea Tree
• Others

By Distribution Channel:

• Direct Distribution
• Others

By Application:

• Food & Beverages
• Personal Care & Cosmetics
• Pharmaceuticals
• Others

By Region and Country:

• North America (U.S., Canada)
• Latin America (Brazil, Mexico, Rest of Latin America)
• Europe (Germany, Italy, France, UK, Spain, Netherlands, Norway, Russia, Rest of Europe)
• Asia-Pacific (China, Japan, South Korea, India, Indonesia, Thailand, Vietnam, Australia & New Zealand, Rest of Asia-Pacific)
• Middle East (Saudi Arabia, Turkey, UAE, Rest of Middle East)
• Africa (South Africa, Nigeria, Egypt, Rest of Africa)

Segment-Wise Analysis

Why are Food & Beverages estimated to account for the largest market share?

Over the forecast period, the food and beverage segment is anticipated to experience the highest CAGR. This is due to the food and beverage industry’s rising emphasis on improving product shelf life without sacrificing quality. Food and beverage producers now offer healthful essential oils due to changing consumer preferences toward natural products over synthetic ones and rising demand for high-quality food items. Due to their suitability for internal use, basil, fennel, lemon, cassia, and peppermint emerged as the most popular essential oils for food and beverage applications.

Why is Direct Distribution expected to expand the fastest during the forecast period?

The direct distribution segment accounted for a 46.2% revenue share. More individuals are becoming aware of the benefits of essential oils, which has increased retail sales, particularly through convenience stores. To expand their businesses and boost sales, prominent competitors like doTerra and Young Living Essential Oils have embraced multi-level marketing tactics.

Region-Wise Analysis

The regions analyzed for the market include North America, Europe, Latin America, Asia Pacific, Middle East, and Africa.

• With a 43.0% revenue share, Europe controlled the majority of the market for essential oils. In the upcoming years, the area is anticipated to dominate the industry. This is linked to the existence of developed end-use businesses and growing consumer knowledge of the advantages of essential oils.
• Over the years, Asia Pacific is anticipated to experience the market for essential oils with the highest CAGR of 8.4%. This is due to favorable weather for farming, inexpensive labor, and a plentiful supply of raw resources.

Competition Analysis

To reduce resource consumption and increase productivity, businesses are concentrating on improving their production methods. Market players’ main strategies are to increase profitability through value chain optimization and business process restructuring. To obtain cutting-edge raw materials for novel solutions, businesses launch pilot projects to cultivate crops that have never been produced in the field.

Players have noticed an increase in manufacturing capacity to meet the rising demand from numerous end-use sectors. Players are also concentrating on making sizeable expenditures in R&D operations to create an ecologically friendly production process and lessen the market on the natural resources from which key ingredients are obtained.

The key development in the Global Essential Oil Market:

• In July 2022, with its expansion into India, doTERRA is expanding quickly. Since the essential oils used by doTERRA are derived from places like India, Asia, the Pacific, the Middle East, and Africa, having a business presence there makes sense strategically for the company’s expansion worldwide.
• In February 2022, Myrissi was purchased by Givaudan (France). Myrissi’s experience in AI would assist Givaudan in suggesting novel organoleptic methods to customers, enabling Givaudan’s long-term Fragrance & Beauty strategy.

A list of some of the key suppliers present in the market are:

• Takasago International Corporation
• Symrise
• MANE
• Flavex Naturextrakte GmbH
• Firmenich SA
• Synthite Industries Ltd.
• ROBERTET GROUP
• International Flavors & Fragrances Inc.
• Givaudan
• Falcon
• Norex Flavours Private Limited
• BMV Fragrances Pvt. Ltd.

Report Coverage and Highlights

• Our comprehensive, data-backed, and facts-oriented report provides niche and cross-sectional analysis at global and country levels.
• Assessment of the historical (actual data) and current market size (2017-2021), market projections (2022-2032), and CAGR.
• The market assessment across North America, Europe, East Asia, South Asia & Pacific, Latin America, Middle East, and Africa.
• Competitive tactical intelligence, key strategies adopted by top players, production capacity and company shares analysis, product brand surveys, and export-import analysis
• Pricing analysis to set and benchmark your current or future offerings across each product type helps you understand whether your pricing strategy is aligned with market expectations and can be compared to market disruptions.
• Predictions on critical supply and demand trends and technological expertise needed to address operations scalability.
• Consumer behavior shifts and their implications for players, list of end-users, and their consumption analysis.
• Key drivers, restraints, opportunities, and emerging trends impacting the market growth.
• Value chain analysis (list of manufacturers, distributors, end-users, and average profitability margins).
• Strategic market analysis, recommendations, and future headways on crucial winning strategies.