Essential Oils Market Outlook Report
Essential Oils Market Outlook by Type (Citrus, Tea Tree, Eucalyptus, Citronella, Clove, Lavender, and Others), Application (Food & Beverages, Fragrances, Cosmetics, & Aromatherapy, Household, and Pharmaceuticals), and Regional Analysis (North America, Europe, Asia-Pacific, and LAMEA): Global Opportunity Analysis and Industry Forecast, 2021–2028
pandemic has shown to have an enormous impact
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Impact of covid-19 on Essential Oils Market Outlook
Global Essential Oils Market Share Analysis
The global essential oils market forecast is predicted to garner $20,497.61 million in the 2021–2028 timeframe, growing from $10,349.81 million in 2020, at a healthy CAGR of 9.20%.
Strategic alliances among market players, along with trends of aromatherapy, is expected to accelerate the growth of the essential oils market.
However, high cost of essential oils along with concerns related to depletion of natural resources might be some of the growth-restricting factors for the market.
According to the regional analysis, the Asia-Pacific essential oils market forecast is anticipated to grow during the review period and generate a revenue of $6,005.80 million in 2028, with CAGR of 10.30%, due to increasing consciousness of consumers about the benefits of essential oil.
Essential Oils Overview
Essential oils are compounds that are extracted from plants (any part) and capture plant’s essence, flavor, or scent. Therefore, every essential oil has its own characteristic essence or aroma such as clove, peppermint oil, and others. Moreover, essential oils can be obtained with the help of distillation, cold pressing, and mechanical methods. Some of the examples of essential oils are tea tree oil, lavender oil, rosemary oil, clove oil, and other essential oils.
Covid-19 Impact on Essential Oils Market
Though the novel coronavirus pandemic had a devastating effect on several industries, the essential oils market experienced a positive growth during this period. Essential oils have anti-infective, antioxidant, and antimicrobial properties; therefore, they are used in treating different health conditions including stress conditions, immunity disorders, depression, and sleep disorders. For example, doterra oils are considered to be the best essential oils across the globe. Therefore, the importance of essential oils market share has skyrocketed, thus driving the growth of the market.
In addition to this, according to the news published by Times of India, in July 2021, aromatherapy with the help of sandalwood and jasmine essential oils is the best way to overcome depression, sadness, and stress. The above-stated factors show that the pandemic may generate substantial investment opportunities for the market in the coming years and Covid-19 impact on essential oils market has been positive.
Increasing Prevalence of Essential Oils in Food Industry to Surge the Market Growth
The global essential oils market outlook is witnessing a massive growth mainly due to increasing usage of essential oils in food and beverage industries. Essential oils are used instead of several herbs and juices; few drops of essential oils enhance the flavor of food. Such factors will increase the adoption of essential oils as a replacement of herbs and drive the market growth globally. Furthermore, demand for conscious food choices, healthy lifestyles along with preventive health measures in the food sector are leading to the overall growth of essential oil.
Equivalently, according to an article by Science Direct, world's leading source for scientific, technical, and medical research journals, in June 2019, synthetic preservatives that are used in food industries are very harmful and can cause degenerative diseases, cancer, intoxication, and other allergies. Therefore, essential oils such as lavender oil, peppermint oil, clove oil, tea tree oil, lemon oil, cinnamon oil, mustard oil, thyme oil, oregano oil, and eucalyptus oil are the best essential oils that are acting as food preservatives and prevent microbial growth in food, thereby driving the adoption of personalized nutrition. These types of initiatives from market leaders are also predicted to drive the growth of the market.
To know more about global essential oils market insights, drivers, get in touch with our analysts here.
High Cost of Essential Oils to Restrain the Market Growth
Essential oils are very costly as compared to other oils; therefore, they might be unaffordable by many people. This factor is expected to restrain the growth of the global market during the forecast period. Moreover, manufacturing of essential oils can divest the plants as essential oils are mostly extracted from seeds, wood, flowers, roots, and barks of plants. These are some of the factors anticipated to hinder the market value of the essential oils in the next few years.
Growing Trends of Aromatherapy in the Essential Oils to Create Massive Investment Opportunities
The global essential oils market is growing at a very fast pace due to increasing hectic and busy lifestyles of the people, resulting in significant demand for stress-relieving therapies, driving the demand for aromatherapy. Moreover, aromatherapy with essential oils is the mild sedative that relaxes the brain waves which can decrease the level of stress hormone. All these properties of essential oils make them ideal to use in insomnia, a sleep aid, thereby positively affecting the market growth.
Furthermore, essential oils industry already has leading market players innovating strategies to attract customers. For example, dôTERRA, a multinational company based in Utah that sells essential oils and other related products, announced in October 2020, that they are going to launch different essential oils products and diffusers that include three new wellness programs that is completely designed to help customers focus on their specific health goals. All such aspects may further lead to lucrative market opportunities for key players in the upcoming years.
To know more about global essential oils market opportunities, get in touch with our analysts here.
Essential Oils Market
Based on essential oils type, the market has been divided into Citrus, tea tree, eucalyptus, citronella, clove, lavender, and others sub-segments of which the Citrus sub-segment is projected to generate the maximum revenue as well as show the fastest growth.
Source: Research Dive Analysis
The citrus type sub-segment is predicted to have a dominating as well as fastest growing market share in the global market. The sub-segment is expected to register a revenue of $4,907.12 million during the forecast period. Citrus essential oils are mostly used in home care products as they can dissolve easily in other substances; some of the common citrus essential oils are sweet orange, bitter orange, neroli orange petitgrain, mandarin, lemon, lime, and others. Moreover, according to an article by Healthline Media, media company based in San Francisco, in October 2019, orange essential oils offer various benefits such as they are antimicrobial, reduce symptoms of anxiety and depression, act as pain reliefs, anticancer, antioxidant, and promote weight loss. These factors and key benefits may bolster the growth of the sub-segment during the forecast period.
Essential Oils Market
On the basis of application, the market has been sub-segmented into Food & Beverages, fragrances, cosmetics & aromatherapy, household, and pharmaceuticals sub-segments. Among the mentioned sub-segments, the fragrances, cosmetics, & aromatherapy sub-segment is predicted to show the fastest growth and Food & Beverages garner a dominant market share.
Source: Research Dive Analysis
The food & beverages sub-segment of the global essential oils market is projected to have the dominant share. It is also projected to surpass $7,460.75 million by 2028, with an increase from $3,745.10 million in 2020. This growth in the market can be attributed to rising number of diseases across the globe. Essential oils are very useful in food and beverage industry to prevent viral infections caused by synthetic preservatives. Moreover, growing trends of natural and healthy ingredients in the food are some the factors that will ultimately increase the demand for essential oils in sub-segment and further surge the market growth.
The fragrances, cosmetics, & aromatherapy sub-segment of the global essential oils market is projected to have the fastest growth. It is also projected to surpass $6,762.47 million by 2028, with an increase from $3,216.58 million in 2020. This growth in the market can be attributed to increasing number of organic cosmetics and fragrances that use natural essence of plants, for example, rose essential oils are mostly used in cosmetic products such as body lotion, cream, and soaps. All such elements may increase the demand for essential oils in fragrances, cosmetics, and aromatherapy, thereby upsurging the market growth.
Essential Oils Market
The essential oils market was investigated across North America, Europe, Asia-Pacific, and LAMEA.
Source: Research Dive Analysis
The Market for Essential Oils in Europe to be the Most Dominant
The Europe essential oils market accounted $4,419.37 million in 2020 and is projected to register a revenue of $8,854.97 million by 2028. The extensive growth of the Europe essential oils market is mainly driven by the presence of organizations such as The European Federation of Essential Oils (EFEO) in Europe that promotes the production and trades of essential oils and its related products across Europe. Moreover, the strong presence of leading essential oils providers and manufacturers is fueling the market growth across the globe. These factors will ultimately drive the demand in the essential oils market across the region.
The Market for Essential Oils in Asia-Pacific to be the Fastest Growing
The share of Asia-Pacific essential oils market is expected to rise at a CAGR of 10.30%, by registering a revenue of $6,005.80 million by 2028. The growth shall be a result of increasing focus towards high quality of foods and snacks, encouraging manufacturers to opt for essential oils as per their preferences. In addition to this, growing trends of natural cosmetics and fragrances are some of the aspects that may bolster the demand for essential oils market, in the upcoming years.
Competitive Scenario in the Global Essential Oils Market
Product launches and mergers & acquisitions are common strategies followed by major market players.
Source: Research Dive Analysis
Some of the leading essential oils market players are Cargill, Inc., DuPont, Koninklijke DSM N.V., dôTERRA International LLC, Givaudan SA, Young Living Essential Oils, The Lebermuth Company, Inc., Symrise, Sensient Technologies Corporation, and Essential oils of New Zealand.
Porter’s Five Forces Analysis for the Global Essential Oils Market:
- Bargaining Power of Suppliers: The suppliers of essential oils market are high in number and are larger and more globalized. So, there will be less threat from the suppliers.
Thus, the bargaining power of suppliers is low.
- Bargaining Power of Buyers: Buyers demand cost effective essential oils. This has increased the pressure on the essential oils providers to offer the best essential oils in a cost-effective way. Thus, many suppliers are offering best yet cost – effective essential oil. This gives the buyers the option to freely choose essential oils that best fits their preference.
Thus, the bargaining power of the buyers is high.
- Threat of New Entrants: Companies entering the essential oils market are adopting various innovations such as developing essential oils that are helpful in overcoming stress and depression.
Thus, the threat of the new entrants is moderate.
- Threat of Substitutes: There are different types of essential oils available. Different essential oils have different uses; thus, no substitutes are required.
Therefore, threat of substitutes is low.
- Competitive Rivalry in the Market: The competitive rivalry among industry leaders is rather intense, especially between the global players including dôTERRA International LLC and Young Living Essential Oils. These companies are launching their value-added services in the international market and strengthening the footprint worldwide.
Therefore, competitive rivalry in the market is high.
Historical Market Estimations
Base Year for Market Estimation
Forecast Timeline for Market Projection
North America, Europe, Asia-Pacific, LAMEA
Segmentation by Type
Segmentation by Application
Key Companies Profiled
Q1. What is the size of the global essential oils market?
A. The size of the global essential oils market was over $10,349.81 million in 2020 and is projected to reach $20,497.61 million by 2028.
Q2. Which are the major companies in the essential oils market?
A. Koninklijke DSM N.V. and dôTERRA International LLC are some of the key players in the global essential oils market.
Q3. Which region, among others, possesses greater investment opportunities in the near future?
A. The Asia-Pacific region possesses great investment opportunities for investors to witness the most promising growth in the future.
Q4. What will be the growth rate of the Asia-Pacific essential oils market?
A. Asia-Pacific essential oils market is anticipated to grow at 10.30% CAGR during the forecast period.
Q5. What are the strategies opted by the leading players in this market?
A. Technological development and strategic partnerships are the key strategies opted by the operating companies in this market.
Q6. Which companies are investing more on R&D practices?
A. dôTERRA International LLC and Young Living essential oils are investing more on R&D activities for developing new products and technologies.
Q7. Who is the largest essential oil company?
A. dôTERRA International LLC is the largest essential oil company.
Q8. Is essential oil business profitable?
A. Yes, business for essential oil is profitable.
Q9. How big is the essential oil market?
A. Essential oil market is estimated to be $10,349.81 million in 2020.
Q10. Which is the leading segment based on product type in the Essential Oils Market?
A. Citrus type essential oil is the leading segment based on product type in the essential oils Market.
1.2.Real time insights and validation
1.4.Assumptions and forecast parameters
2.2.By type trends
2.3.By application trends
3.1.Market segmentation & definitions
3.2.1.Top investment pockets
3.2.2.Top winning strategies
3.3.Porter’s five forces analysis
3.3.1.Bargaining power of consumers
3.3.2.Bargaining power of suppliers
3.3.3.Threat of new entrants
3.3.4.Threat of substitutes
3.3.5.Competitive rivalry in the market
3.8.Market value chain analysis
3.8.1.Stress point analysis
3.8.2.Raw material analysis
126.96.36.199.Raw material suppliers
4.Essential oil Market, by Type
4.1.1.Market size and forecast, by type
4.2.1.Key market trends, growth factors, and opportunities
4.2.2.Market size and forecast, by region, 2020-2028
4.2.3.Market share analysis, by country 2020 & 2028
4.3.1.Key market trends, growth factors, and opportunities
4.3.2.Market size and forecast, by region, 2020-2028
4.3.3.Market share analysis, by country 2020 & 2028
4.4.1.Key market trends, growth factors, and opportunities
4.4.2.Market size and forecast, by region, 2020-2028
4.4.3.Market share analysis, by country 2020 & 2028
4.5.1.Key market trends, growth factors, and opportunities
4.5.2.Market size and forecast, by region, 2020-2028
4.5.3.Market share analysis, by country 2020 & 2028
4.6.1.Key market trends, growth factors, and opportunities
4.6.2.Market size and forecast, by region, 2020-2028
4.6.3.Market share analysis, by country 2020 & 2028
4.7.1.Key market trends, growth factors, and opportunities
4.7.2.Market size and forecast, by region, 2020-2028
4.7.3.Market share analysis, by country 2020 & 2028
4.8.1.Key market trends, growth factors, and opportunities
4.8.2.Market size and forecast, by region, 2020-2028
4.8.3.Market share analysis, by country 2020 & 2028
5.Essential oil Market, by Application
5.1.1.Market size and forecast, by Application
5.2.Food and beverages
5.2.1.Key market trends, growth factors, and opportunities
5.2.2.Market size and forecast, by region, 2020-2028
5.2.3.Market share analysis, by country 2020 & 2028
5.3.Fragrances, cosmetics and aromatherapy
5.3.1.Key market trends, growth factors, and opportunities
5.3.2.Market size and forecast, by region, 2020-2028
5.3.3.Market share analysis, by country 2020 & 2028
5.4.1.Key market trends, growth factors, and opportunities
5.4.2.Market size and forecast, by region, 2020-2028
5.4.3.Market share analysis, by country 2020 & 2028
5.5.1.Key market trends, growth factors, and opportunities
5.5.2.Market size and forecast, by region, 2020-2028
5.5.3.Market share analysis, by country 2020 & 2028
6.Essential oil Market, by Region
6.1.1.Market size and forecast, by region
6.2.1.Key market trends, growth factors, and opportunities
6.2.2.Market size and forecast, by type, 2020-2028
6.2.3.Market size and forecast, by Application, 2020-2028
6.2.4.Market size and forecast, by country, 2020-2028
188.8.131.52.Market size and forecast, by type, 2020-2028
184.108.40.206.Market size and forecast, by Application, 2020-2028
220.127.116.11.Market size and forecast, by type, 2020-2028
18.104.22.168.Market size and forecast, by Application, 2020-2028
22.214.171.124.Market size and forecast, by type, 2020-2028
126.96.36.199.Market size and forecast, by Application, 2020-2028
6.3.1.Key market trends, growth factors, and opportunities
6.3.2.Market size and forecast, by type, 2020-2028
6.3.3.Market size and forecast, by Application, 2020-2028
6.3.4.Market size and forecast, by country, 2020-2028
188.8.131.52.Market size and forecast, by type, 2020-2028
184.108.40.206.Market size and forecast, by Application, 2020-2028
220.127.116.11.Market size and forecast, by type, 2020-2028
18.104.22.168.Market size and forecast, by Application, 2020-2028
22.214.171.124.Market size and forecast, by type, 2020-2028
126.96.36.199.Market size and forecast, by Application, 2020-2028
188.8.131.52.Market size and forecast, by type, 2020-2028
184.108.40.206.Market size and forecast, by Application, 2020-2028
220.127.116.11.Market size and forecast, by type, 2020-2028
18.104.22.168.Market size and forecast, by Application, 2020-2028
6.3.10.Rest of Europe
22.214.171.124.Market size and forecast, by type, 2020-2028
126.96.36.199.Market size and forecast, by Application, 2020-2028
6.4.1.Key market trends, growth factors, and opportunities
6.4.2.Market size and forecast, by type, 2020-2028
6.4.3.Market size and forecast, by Application, 2020-2028
6.4.4.Market size and forecast, by country, 2020-2028
188.8.131.52.Market size and forecast, by type, 2020-2028
184.108.40.206.Market size and forecast, by Application, 2020-2028
220.127.116.11.Market size and forecast, by type, 2020-2028
18.104.22.168.Market size and forecast, by Application, 2020-2028
22.214.171.124.Market size and forecast, by type, 2020-2028
126.96.36.199.Market size and forecast, by Application, 2020-2028
188.8.131.52.Market size and forecast, by type, 2020-2028
184.108.40.206.Market size and forecast, by Application, 2020-2028
220.127.116.11.Market size and forecast, by type, 2020-2028
18.104.22.168.Market size and forecast, by Application, 2020-2028
22.214.171.124.Comparative market share analysis, 2020 & 2028
6.4.10.Rest of Asia Pacific
126.96.36.199.Market size and forecast, by type, 2020-2028
188.8.131.52.Market size and forecast, by Application, 2020-2028
6.5.1.Key market trends, growth factors, and opportunities
6.5.2.Market size and forecast, by type, 2020-2028
6.5.3.Market size and forecast, by Application, 2020-2028
6.5.4.Market size and forecast, by country, 2020-2028
184.108.40.206.Market size and forecast, by type, 2020-2028
220.127.116.11.Market size and forecast, by Application, 2020-2028
18.104.22.168.Market size and forecast, by type, 2020-2028
22.214.171.124.Market size and forecast, by Application, 2020-2028
126.96.36.199.Market size and forecast, by type, 2020-2028
188.8.131.52.Market size and forecast, by Application, 2020-2028
7.1.2.Operating business segments
7.1.5.Recent strategic moves & developments
7.2.2.Operating business segments
7.2.5.Recent strategic moves & developments
7.3.Koninklijke DSM N.V.
7.3.2.Operating business segments
7.3.5.Recent strategic moves & developments
7.4.dôTERRA International LLC
7.4.2.Operating business segments
7.4.5.Recent strategic moves & developments
7.5.2.Operating business segments
7.5.5.Recent strategic moves & developments
7.6.Young Living Essential Oils
7.6.2.Operating business segments
7.6.5.Recent strategic moves & developments
7.7.The Lebermuth Company, Inc.
7.7.2.Operating business segments
7.7.5.Recent strategic moves & developments
7.8.2.Operating business segments
7.8.5.Recent strategic moves & developments
7.9.Sensient Technologies Corporation
7.9.2.Operating business segments
7.9.5.Recent strategic moves & developments
7.10.Essential oils of New Zealand
7.10.2.Operating business segments
7.10.5.Recent strategic moves & developments
Essential oils are extracted from plants. During the extraction, the oil brings out the scent, flavor, or essence with it. Each essential oil gets its distinguishing essence from this extracted scent.
Essential oils are compounds extracted from plants. The oils capture the plant’s scent and flavor, or “essence.” Unique aromatic compounds give each essential oil its characteristic essence. Cold pressing and distillation are the processes essential oils are extracted from the trees and plants.
Essential oil has many applications especially in the cosmetic and makeup industry, and aromatherapy, which has added to the growth of the essential oils market. It is used in the cosmetic industry mainly to create perfumes, elevate creams, and body washes with fragrances. Essential oils are also used by aromatherapists to offer healing treatments to patients with severe psychological stress and depression. There are many essential oils available in the market. Lavender, peppermint, tea tree, lemon, sweet orange, eucalyptus, orange, and chamomile are some of the most popular essential oils.
These beneficial factors of essential oils are expected to flourish the global essential oils market in the forthcoming years, according to a recent report by Research Dive.
Recent Advances in the Essential Oils Market
According to a report published by Research Dive, the leading players of the global essential oils market include Symrise, The Lebermuth Company, Inc., Givaudan SA, Koninklijke DSM N.V., Young Living Essential Oils, DuPont, Essential oils of New Zealand, Cargill, Inc., Sensient Technologies Corporation, and dôTERRA International LLC among many others.
These industry players are investing a lot of efforts on the research and development of smart and unique strategies to sustain the growth of the market. These strategies include product launches, mergers and acquisitions, collaborations, partnerships, and refurbishing of existing technology.
Some of the recent developments of the essential oils market are as follows:
- In November 2020, Symrise AG, a leading producer of flavors and fragrances, signed a purchase agreement with Sensient Technologies Corporation, a global manufacturer of colors and scents based out of Milwaukee, USA to acquire their fragrance and aroma chemicals activities which include a wide variety of aroma molecules and fragrances both from natural and renewable sources.
- In July 2021, Givaudan, the global leader in fragrance creation, entered into a definitive agreement with Privi Speciality Chemicals Limited, a leading manufacturer of aroma and fragrance chemicals in India. This agreement is aimed to reinforce production capabilities of Givaudan for the global specialty fragrance ingredients.
The agreement is also aimed to establish a new greenfield production plant in Mahad, a South Mumbai city. This plant is expected to manufacture small-volume fragrance ingredients of medium to high complexity.
- In July 2021, Sensient Technologies Corporation, a global manufacturer of colors and flavors completed its acquisition of Flavor Solutions, Inc., a leading flavor development company. The acquisition is expected to expand the flavor portfolio of Sensient by extending its traditional flavor offering, savory reaction flavors, natural shelf-life, and taste-modulation technology platforms.
Impact Analysis of COVID-19 on the Essential Oils Market
The COVID-19 pandemic has impacted the global economy in a negative way. Many companies went bankrupt while others were closed down temporarily. On the other hand, essential oils market has experienced a prosperous growth during the critical pandemic period. The beneficial properties of essential oils are the main factors behind the growth of the market. Apart from being used as an alternative to spices and herbs in cooking food, essential oils are also extensively used in aromatherapy and manufacturing of cosmetic product. Many industry leaders are focusing on the enhancing the growth of the market in the post pandemic period.
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