In 2023, the global essential oil market was valued at USD 11.41 billion and is projected to grow at a compound annual growth rate (CAGR) of 10.55%, reaching USD 12.47 billion in 2024 and USD 27.82 billion by 2032.
Essential oils, also known as aetheroleum oils, are non-water-soluble liquids derived from plants that contain volatile fragrance compounds. The market's growth is driven by the rising trend of green consumerism and the growing preference for natural alternatives in food preservation and sensory applications. Comprising complex and volatile compounds, essential oils are recognized for their efficacy against infections, inflammation, fungi, and viruses, without the significant side effects often associated with prescription medications.
As a result, essential oils are increasingly being utilized as substitutes for chemicals, pharmaceuticals, and drugs due to their health benefits and lower risk of adverse reactions. Additionally, their aromatic properties are widely used in conventional medicines and pharmaceuticals to neutralize undesirable odors in certain substances.
These factors are expected to propel market growth, as highlighted in the report "Essential Oils Market, 2024-2032" by Fortune Business Insights™.
Information Source: https://www.fortunebusinessinsights.com/industry-reports/essential-oils-market-101063
List of Key Players Present in the Report:
- Biolandes SAS (France)
- Givaudan International SA (Switzerland)
- International Flavours and Fragrances Inc. (U.S.)
- Symrise AG (Germany)
- Enio Bonchev Production Ltd. (Bulgaria)
- The Lebermuth Company, Inc. (U.S.)
- Essential Oils of New Zealand (New Zealand)
- Phoenix Aromas & Essential Oils LLC (U.S.)
- Sydney Essential Oil Co. (Australia)
- Young Living Essential Oils (U.S.)
Segments
Citrus Segment Dominates the Market Due to Rising Consumer Preference
The essential oils market is categorized by type into eucalyptus, rosemary, citrus, lavender, tea tree, peppermint, and others. Among these, the citrus segment holds the largest share, attributed to its exceptional functional properties, widespread availability, and attractive organoleptic qualities. Robust demand for citrus essential oils further solidifies its leading position in the market.
Food & Beverage Segment to Lead Market Growth
Based on application, the market is divided into spa & relaxation, food & beverages, personal care & cosmetics, pharmaceuticals & medicinal formulations, and others. The food & beverage segment is anticipated to dominate during the forecast period, driven by the increasing utilization of essential oils to enhance sensory attributes, extend shelf life, and improve storage stability in food products.
Direct Distribution Channel Gains Traction Amid Growing Awareness
The market is segmented by distribution channel into direct distribution, MLM (multi-level marketing) distribution, and retail distribution. The direct distribution channel currently accounts for the largest market share, propelled by consumers’ growing interest in experiencing essential oil fragrances firsthand. This trend is expected to further accelerate growth in this segment.
Report Coverage-
The report offers:
- Major growth drivers, restraining factors, opportunities, and potential challenges for the market.
- Comprehensive insights into regional developments.
- List of major industry players.
- Key strategies adopted by the market players.
- Latest industry developments such as product launches, partnerships, mergers, and acquisitions.
Drivers & Restraints-
Growing Demand and Need for Natural Ingredients to Foster Market Growth
Plant-based volatile oils are essential for natural food preservation, particularly as concerns over synthetic food additives and their potential long-term health risks continue to rise. Essential oils have shown effective antibacterial properties across a variety of food products, including milk, fish, meat, dairy products, and cooked rice.
These oils are highly concentrated; for example, approximately 250 pounds of lavender flowers are required to produce just one pound of lavender oil. The combination of growing demand and constrained supply is expected to drive up prices, which may limit their accessibility across various application sectors, especially in developing economies.
Regional Insights-
Europe to Dominate the Market Share Owing to Plant-based Volatile Oils
In 2022, Europe is anticipated to dominate the essential oils market, largely driven by the growing adoption of essential oils in cosmetic formulations. The increasing popularity of aromatherapy in countries like the U.K., Germany, and France is also expected to significantly contribute to market growth.
North America is projected to hold the second-largest market share, with a notable increase in demand for essential oils anticipated over the forecast period.
Competitive Landscape-
Industry Association a Priority for Prominent Companies in the Market
The global essential oils market is highly fragmented, primarily due to the strong presence of local and private-label brands in various regions. Major companies such as International Flavors and Fragrances Inc., Givaudan International SA, and Symrise AG are actively engaging in mergers and acquisitions to enhance their market positions and expand their influence within the industry.
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