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Essential Oils Market

Market Study on Essential Oils: Citrus to Remain Most Popular Source

Essential Oils Market Segmented By Citrus Essential Oils, Herbs & Spices Essential Oils, Mint Essential Oils, Flower Essential Oils, Nuts Essential Oils type in Organic Essential Oils, Conventional Essential Oils Form

Essential Oils Market Outlook (2022-2032)

Worldwide consumption of essential oils stands at 497,959 tons in 2022. The global essential oils market is predicted to surge ahead at a CAGR of 7.7% to reach a valuation of US$ 39.14 Bn by 2032.

Essential Oils Market Size (2022E)

US$ 18.66 Bn

Projected Sales of Essentials Oils (2032F)

US$ 39.14 Bn

Value CAGR (2022-2032)

7.7%

Value Share of Top 5 Countries (2021A)

46.4%

In the global market for essential oils, the European region holds dominance and is expected to be valued at US$ 13.43 Bn by the end of 2032. Essential oil sales are set to account for around 15% to 20% value share in the global plant based oils market in 2022.

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Essential Oil Consumption Analysis (2017-2021) Vs Market Estimations (2022-2032)

During the years 2017-2021, global sales of essential oils registered a significant compounded annual growth rate (CAGR) of 7.3%. Essential oils are becoming more popular due to growing emphasis on health and wellbeing, as well as a positive perception of aromatherapy. It is considered a complementary medicine that is utilized to improve health and wellness.

Volatile oils are available in various types such as citrus oil, flowers oil, herbs & spices oil, mints oil, nut oil, and others. These oils are utilized in various sectors such as cooking, aromatherapy, fragrance, cosmetics & personal care, and others, which will drive market growth of essential oils.

Going forward, by 2032, the global essential oils market is expected to reach US$ 39.14 Bn expanding at a value CAGR of 7.7%.

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What are the Factors Driving Essential Oils Market Growth?

“Multi-level Marketing to Benefit Key Manufacturers of Essential Oils”

Many key producers of essential oils have embraced multi-level marketing techniques in order to reach out to more customers and expand their business. Growing awareness of the health benefits of essential oils has resulted in an increase in retail sales, particularly through convenience stores.

In addition to traditional over-the-counter sales, key market players are offering products directly to customers through online retail channels such as e-Commerce platforms. As a result, customers now have easier access to products. Manufacturers of essential oils have also allowed wholesalers to order products in bulk via their websites. Thus, adopting multi-level marketing strategies will help manufacturers allow their products to be available to customers in an efficient manner.

  • For instance, DoTerra recently achieved the 5 Mn global customer mark, owing to widespread awareness and easy access to its products.

“Pharmaceutical industry to Drive Substantial Demand for Essential Oils”

Plant-based oils comprise compounds called phenols, terpenes, and terpenoids that are utilized for medical standards and health assistance. These compounds are used as essential ingredients in pharmaceutical agents and therapeutic drugs. The biological activities of these compounds are used for the treatment of various diseases.

Carvacrol compounds present in essential oils can be used to lower cholesterol levels, improve gut symptoms, and lose weight. These are also popular as pain-reducing agents and cancer-fighting properties.

Essential oils are widely used in capsules and tablets that can be availed from health food stores. The functional properties of ethereal oils make them vital ingredients in the pharma industry for the production of capsules and tablets.

  • For instance, Zane Hellas offers essential oils in the form of capsules for oils to subside to the exact area of the body before dissolving, so as to allow better absorption.

“Intensive R&D to Provide Lucrative Growth Opportunities to Essential Oil Producers”

Key players in the essential oils market are investing heavily in research & development. Manufacturers are working to improve the functionality of essential oils in various applications such as food, cosmetics, pharmaceuticals, and animal nutritional products.

Many companies are focusing on introducing new essential oil blends in order to keep up with rising consumer preferences. This factor is driving the sales of essential oils as a result of the various benefits provided, which has created long-term opportunities for global manufacturers.

  • In 2018, DoTerra International collaborated with the Research Institute for Fragrance Material to expand its essential oil offerings.

“Independent Organizations Supporting Processing of Essential Oils”

The global essential oils market is supported by various organizations to promote the use of organic and natural ingredients or products in a majority of day-to-day applications. These organic essential oils are certified with various standards to promote their trade globally.

High-quality standards are marked by specific guidelines and regulations for the production, harvesting, and processing of herbs and aromatic crops by international organizations, including the European Union and the United Nations. Post-harvesting processing operations for herbs, spices, and essential oils are monitored by entities such as the Food and Agriculture Organization of the United Nations and The United Nations Industrial Development Organization.

The support offered by these organizations creates various opportunities for key essential oil product manufacturers in the market.

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Are There Any Restraining Factors for Market Growth for Essential Oils?

“High Price of Essential Oils Can Hurt Market Expansion”

The high price of essential oils can make it difficult for market players to manage their final product pricing and profit margins at the same time. Fluctuating prices of essential oils can cause a rapid rise or fall in market growth in a short period of time.

Due to the high pricing of essential oils, consumers are trying substitutes such as low-cost oils or synthetic oils, which leads to fluctuation in the demand for essential oils.

“Rising Demand for Natural & True-label Products”

Growing consumer demand for natural products that are free from harmful chemicals is increasing the focus on the origin of fruits and the cultivation method used. This concern is even stronger in the case of fruits, as the peel of the fruit, which is the major source of oils, is exposed to pesticides or fertilizer sprays.

Use of chemicals is not limited to on-farm cultivation; synthetic chemicals such as pesticides and fungicides are also sprayed on fruit shipments to extend shelf-life and prevent spoilage. This is a significant disadvantage as many consumers prefer true-label products and are hesitant to use any chemically-processed ingredients.

Prerna Shiv

Prerna Shiv
Client Partner

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Country-wise Insights

Which Country is Showing Significant Growth Potential in the Middle East & Africa?

“South Africa Essential Oils Market Providing Lucrative Growth Prospects”

In the Middle East & Africa, the South Africa essential oils market is expected to register a value CAGR of 5.7% over the forecast period. Currently, the market is valued at US$ 330.0 Mn, and is growing owing to increased demand for essential oils for various purposes such as perfumery, flavor in aromatherapy, and others.

Why India is Showing Promising Growth in the South Asian Market?

“Aromatherapy Trend Driving Essential Oil Consumption in India”

The India essential oils market has witnessed a positive impact due to ongoing trends among consumers, including aromatherapy practices, health benefits of essential oils, positioning of organic products, and others.

Furthermore, India is a second-largest populated country and also one of the fastest-growing economies in the world, which will offer growth opportunities to essential oil suppliers through various end-use industries, as they are used as vital ingredients in various applications such as cosmetics & personal care, aromatherapy, and others.

Overall, the market in India is expected to register a promising CAGR of 10.9% and rise rapidly from its current valuation of US$ 768.1 Mn.

Category-wise Insights

Which End-use Industries Drive Most Demand for Essential Oils?

“High Consumption Rate of Essential Oils in Cosmetics & Personal Care Sector”

Essential oils are utilized in various end-use industries such as food & beverages, cosmetics & personal care, home care & toiletries, aromatherapy, animal feed, foodservice, retail/households for flavor enhancers, therapeutics or aromatherapy, perfumery, and others.

However, cosmetics & personal care and retail/households are showing potential growth and are slated to register high-value CAGRs of 8.8% and 8.3%, respectively, during the forecast period.

Which Essential Oil Type is Highly Demanded?

“Citrus Essential Oil a Hit among Consumers”

On the basis of type, citrus oils hold a volume share of 47.1% and account for current consumption of approximately 234,413 tons in 2022.

Impact of COVID-19 Crisis

Essential oils are majorly utilized by food & beverage, cosmetics, pharmaceutical, and various other industries. The COVID-19 disease outbreak had both, a positive and negative impact on these industries. Essential oils are used for food preservation, anti-aging product formulations, anti-bacterial drug formulations, and others. The manufacturing of these products was affected for a certain time due to the closing of industrial units across the world.

However, as restrictions were eased, the supply chain and distribution network of essential oils started thriving. Moreover, retail sales of essential oils did not see that much of impact due to higher online sales of health-beneficial products during lockdowns.

Competitive Landscape

Key manufacturers of essential oils are focusing on launching new and innovative blends of essential oils for several applications such as cosmetics, food products, pharmaceuticals, and others. Producers are also focusing on achieving certificates of various international standards to build a strong brand image among their consumers.

  • In 2017, Rocky Mountain Oils, LLC launched its new line of all-natural essential oil-infused supplements called Tohi.
  • BMV Fragrances Pvt. Ltd. established its own manufacturing facility, which is spread over 27,000 sq.ft, consisting of three separate divisions for natural, extracts, and blending.
  • International Flavors & Fragrances Inc. is focused on delivering quality products consistently through innovation and quality management. The company works on agility, new ideas, and leading-edge technology to meet customers’ needs. Its own LMR Naturals collection, which provides essential oils, is certified with ISO 9001:2015 and ISO 14001:2015 for quality and environmental management, and ECOCERT and Kosher for organic compliance and social responsibility.

Essential Oils Industry Report Scope

Attribute

Details

Forecast period

2022-2032

Historical data available for

2017-2021

Market analysis

US$ Million for Value

Key regions covered

  • North America
  • Latin America
  • Europe
  • East Asia
  • South Asia
  • Oceania
  • The Middle East & Africa

Key countries covered

  • U.S.
  • Canada
  • Germany
  • U.K.
  • France
  • Italy
  • Spain
  • Russia
  • China
  • Japan
  • South Korea
  • India
  • Thailand
  • Malaysia
  • Indonesia
  • Australia
  • New Zealand
  • GCC Countries
  • Turkey
  • Northern Africa
  • South Africa

Key market segments covered

  • Type
  • Nature
  • End Use
  • Distribution Channel
  • Region

Key companies profiled

  • Young Living Essential Oils
  • doTERRA
  • Now Health Group, Inc.
  • Givaudan SA
  • Rocky Mountain Oils, LLC
  • NHR Organic Oils
  • Ultra International B.V.
  • AOS Product Pvt. Ltd.
  • Sensient Technologies Corporation
  • BMV Fragrances Pvt Ltd
  • International Flavors & Fragrances
  • Lebermuth Inc.
  • Ugerer and company
  • Van Aroma
  • Falcon Essential Oils
  • Naturral & Essentials Oils Pvt Ltd
  • Flavaroma
  • Prinova Group LLC
  • Sydney Essential Oil
  • Kush Aroma Exports

Report coverage

  • Market Forecasts
  • Company Share Analysis
  • Competition Intelligence
  • DROT Analysis
  • Market Dynamics and Challenges
  • Strategic Growth Initiatives

Customization & pricing

Available upon request

Essential Oils Industry Research by Category

Essential Oils Market by Type:

  • Citrus
  • Herbs & Spices
  • Mints
  • Flowers
  • Nuts
  • Others

Essential Oils Market by Nature:

  • Organic Essential Oils
  • Conventional Essential Oils

Essential Oils Market by End Use:

  • Food & Beverage Industry
  • Cosmetics & Personal Care
  • Home Care & Toiletries
  • Aromatherapy
  • Animal Feed
  • Foodservice Industry
  • Retail/Households

Essential Oils Market by Distribution Channel:

  • Business to Business
  • Business to Consumer
    • Hypermarkets/Supermarkets
    • Specialty Stores
    • Online Retail
    • Other Retail Sectors

Essential Oils Market by Region:

  • North America Essential Oils Market
  • Latin America Essential Oils Market
  • Europe Essential Oils Market
  • South Asia Essential Oils Market
  • East Asia Essential Oils Market
  • Oceania Essential Oils Market
  • Middle East & Africa Essential Oils Market

- Companies Covered in This Report -

  • Young Living Essential Oils
  • doTERRA
  • Now Health Group, Inc.
  • Givaudan SA
  • Rocky Mountain Oils, LLC
  • NHR Organic Oils
  • Ultra International B.V.
  • AOS Product Pvt. Ltd.
  • Sensient Technologies Corporation
  • BMV Fragrances Pvt Ltd
  • International Flavors & Fragrances
  • Lebermuth Inc.
  • Ugerer and company
  • Van Aroma
  • Falcon Essential Oils
  • Naturral & Essentials Oils Pvt Ltd
  • Flavaroma
  • Prinova Group LLC
  • Sydney Essential Oil
  • Kush Aroma Exports

- Frequently Asked Questions -

Global essential oil consumption is currently pegged at 18,658.4 tons.

The global essential oils market size is expected to be valued at US$ 18.66 Bn in 2022.

The France essential oils market is predicted to register the highest CAGR of 8.1% in Europe.

Young Living Essential Oils, dōTERRA, Now Health Group, Inc., Ultra International B.V., and Givaudan SA, AOS Product Pvt. Ltd. hold an approximate market share of 30% to 40%.

The Germany essential oils market is valued at US$ 940.4 Mn in 2022.

Cosmetics & personal care holds dominance with a value share of 34.4%.

Market value of essential oils in Indonesia is anticipated to reach US$ 1.33 Bn by 2032, and Australia is set to reach US$ 695.5 Mn.

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