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(Health-NewsWire.Net, November 12, 2021 ) The global essential oils market size is estimated to be valued USD 10.3 billion in 2021 and is expected to reach a value of USD 16.0 billion by 2026, growing at a CAGR of 9.3% in terms of value during the forecast period. In terms of volume, the market is estimated to account for 253.2 KT in 2021 and is expected to reach at 345.4 KT by 2026, growing at a CAGR of 6.4% during the forecast period. Factors such as an growth in awareness toward preventive healthcare, improvements in the standard of living and rise in double income households, along with increase in demand for aromatherapy are some of the factors driving to the growth of the market for essential oils.
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Driver: Increase in demand for aromatherapy
Aromatherapy can be defined as the use of essential oils for healing and cosmetic purposes. Essential oils benefit the physiological as well as psychological activity simultaneously in the body, owing to which they are largely used in aromatherapy. Until recently, aromatherapy was considered a complementary therapy; however, it is currently considered a mainstream therapy. The increased demand for aromatherapy could be attributed to several factors, the most important being the general rise in income in the past decade. As incomes have increased, the consumers’ tastes and preferences have also shifted toward more sophisticated products. According to the International Spa Association (ISPA), spa visits have been growing each year. According to the 2019 US Spa Industry Study, the spa industry witnessed an increase across the board in key performance metrics. The spa industry once again set records in total revenue, spa visits, spa locations, revenue per visit and total employees in 2018. Total spa revenues were USD 18.3 billion, a 4.7% increase from the USD 17.5 billion in 2017. The spa visits were up 1.6% to 190 million in 2018. The spa locations rose to 22,160, a 1.8% jump from the 21,770 in 2017 in the US. The revenue per visit climbed to USD 96.50, a 3% rise from 2017.
Restraint : Depletion of natural resources
A healthy ecosystem provides a range of benefits that acts as the foundation of human well-being. Plants are an essential part of this ecosystem as they balance the world by providing food and shelter. They also assist in physiological and psychological well-being through their therapeutic products such as essential oils. However, this source is exhausting gradually. This could be attributed to an increase in population and industrialization that has resulted in deforestation.
With the increased population, an increasing number of trees are cut to accommodate the increased number of people. According to The World Counts, “up to 28,000 species can go extinct in the next quarter-century due to deforestation. 13 million hectares of forest have been converted for other uses or destroyed by natural causes.
Essential oils are very concentrated compounds and have a very low yield. For example, one pound of lavender essential oil consumes around 220 lbs. of lavender flowers. Deforestation, along with the low yield of essential oil, is a major factor that acts as a barrier in the essential oils market.
Opportunity: Rise in demand for natural ingredients
The demand for “all-natural ingredients” has lately been on the rise mainly due to the growing awareness about the benefits of natural ingredients and the increasing disposable income, which results in people spending more money on expensive natural products. The increasing health consciousness among people fuels this demand further by leading to more liberal spending on good-quality natural products, which would provide long-lasting results.
Several manufacturers across all industries are developing new ways of incorporating natural and healthy ingredients in their formulations for providing maximum benefits to the consumers. ‘Natural claims’ largely influence the purchase of food & beverage and cosmetic applications. Essential oils provide that ‘all natural’ flavor and fragrance across several industries such as food & beverage, cosmetics, feed, and home care, among others, which creates several opportunities for essential oils market.
Challenges : Prevalence of synthetic/adulterated products
There is an important concern of adulteration in essential oils, which has become a major challenge for essential oils market. Not all essential oils are created equal and may contain synthetic adulterants. These adulterated essential oils do not possess the properties of essential oils and merely act as fragrance products.
Adulterated essential oils are extremely hazardous. They may have numerous side effects and may cause permanent damage to the organs. However, the high prices of essential oils are the main reason for the prevalence of such adulterated and synthetic products. One liter of pure rose essential oil costs around USD 78 thousand; however, the inferior quality of the same quantity would cost around 200–300 dollars. Adulteration thus helps in cutting down the cost and making the product available for the masses, owing to which there is a prevalence of synthetic/adulterated products.
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This report includes a study on the marketing and development strategies, along with a study on the product portfolios of the leading companies operating in the essential oils market. It consists of the profiles of leading companies such Cargill, Inc. (US), DuPont (US), Koninklijke DSM N.V. (Netherlands), dôTERRA International LLC (US), Givaudan SA (Switzerland), Young Living Essential Oils (US), The Lebermuth Company, Inc. (US), Symrise (Germany), Sensient Technologies Corporation (US), Essential oils of New Zealand (New Zealand), Firmenich SA (Switzerland), International Flavors & Fragrances Inc. (US), Mane (France), ROBERTET SA (France), Rocky Mountain Oils LLC (US), BIOLANDES SAS (France), Falcon (India), Farroti (Italy), Indian Essential Oils (India), and Ungerer Limited (UK).
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