Plant Extracts Market

Increasing Demand for essential oil within cosmetic industry Is Driving Market Growth

Essential oils are widely used in cosmetics, perfumery, food and beverages, cleaning products, and home fragrances, for their relaxing, stimulating, antiseptic, bactericidal, decongestant, soothing, antispasmodic, and anti-inflammatory properties. Aside from fragrance, essential oils such as lemon and orange have antiseptic properties, making them promising cosmetic active ingredients. Essential oils with anti-acne, anti-aging, skin lightening, and sun protection properties are also used in skincare. Skincare is the most important product category, with many products containing natural ingredients. According to Statista, the revenue in the Beauty & Personal Care market amounts to US$571.10bn in 2023.

The market is expected to grow annually by 3.80% (CAGR 2023-2027), thereby driving demand for essential oil and plant extracts market.

Essential oils are primarily used as fragrances, but other plant-based extracts are also utilized for their active properties. Essential oils can also be found in soaps, cosmetics, and deodorants. Companies in the ecosystem are working to expand the market for essential oils in cosmetics. Primavera Life, a manufacturer of natural cosmetics and essential oils, incorporates essential oils from all over the world into its products, including lemongrass from Bhutan and Nepal, cajeput from Cambodia, and lemon verbena and myrtle from Peru.

The perfumery and personal care industries typically use more expensive essential oils. According to the European Federation of Essential Oils (E.F.E.O), fragrances, cosmetics, and aromatherapy account for roughly one-third of essential oil demand. The cosmetics industry is expected to increase demand because many natural and conventional cosmetics companies use essential oils as fragrances. Eucalyptus, citrus, floral oils, tea tree, and lavender are among the highly valued essential oils used as fragrances. Geraniol, citral, linalool, limonene, and citronellol are some of the other well-known fragrances. Such factors are projected to be a major market driver for Plant Extracts market revenue.

The increasing consumer preference for natural and organic products drives the Global Plant Extracts Market Industry. As health-conscious consumers seek alternatives to synthetic additives, the demand for plant-based ingredients in food, cosmetics, and pharmaceuticals rises. This trend is evident in the food sector, where plant extracts are utilized for flavoring and preservation. The market is projected to reach 40.1 USD Billion in 2024, reflecting a growing inclination towards natural solutions. Companies are responding by expanding their portfolios to include a variety of plant extracts, catering to diverse consumer needs and preferences.

By Region, the study provides the market insights into North America, Europe, Asia-Pacific and Rest of the World. North America is an attractive region among the manufacturers of plant extracts. The rising demand for natural ingredients in a variety of foods and beverages is expected to fuel the growth of the plant extracts market in North America. Another major factor driving market growth is product innovation in the food and beverage industry. Consumers are increasingly interested in skincare products made with natural ingredients, which has led to an increase in the use of plant extracts in radiance and anti-cellulite products.

Furthermore, rising demand for herbal medicinal products and supplements is expected to drive growth in the region's plant extracts market. The US Plant Extracts market is expected to maintain its dominance in the North American plant extracts market, whereas the Canada plant extracts market is the fastest growing during the forecast period.

Further, the major countries studied in the market report are The U.S., Canada, Germany, France, the UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil.

Figure 3:  PLANT EXTRACTS MARKET SHARE BY REGION 2022 (%)

Type: Secondary Research, Primary Research, MRFR Database, and Analyst Review

Europe Plant Extracts market held the second-largest market share in 2022 and is expected to be the most profitable regional market during the review period. The increasing consumption of functional beverages, which is particularly high in European countries, is one of the significant factors driving the growth of plant extracts. Customers prefer healthy and nutritious drink alternatives to calorie-laden soft drinks with little or no functional benefits. This shift in preference is the result of a greater emphasis on preventive healthcare and a growing public awareness of health and wellness.

Product development and technological advancements drive the growth of the European functional beverages market during the forecast period. Aside from that, the growing demand for chemical-free cosmetics is encouraging skincare product manufacturers to incorporate plant extracts and other natural ingredients. Further, the Italy Plant Extracts market held the largest market share, and the Germany Plant Extracts market was the fastest growing market.

Asia Pacific Plant Extracts market had the significant revenue share. The plant extracts market in the region is thriving due to high domestic and international demand. Vital Herbs, Alchemy Chemicals, Sydler, and Plantnat are just a few of the small and medium-sized plant extract manufacturers in the region who are aware of the benefits of plant extract manufacturing. Further, the China Plant Extracts market held the largest market share, and the India Plant Extracts market was the fastest growing market in the Asia-Pacific region. 

The major market players of natural extracts such as essential oils, oleoresins, herbal extracts, natural colours, and dried crops invest in R&D initiatives to provide customers with new and improved products. Companies form alliances with other manufacturers in order to produce potential products that meet the specific needs of their customers. Manufacturers are also investing in new and advanced manufacturing technologies that improve process efficiency while lowering manufacturing costs and time. Market participants are also attempting to acquire raw material manufacturers through backward integration.

Synthite Industries Ltd., for example, has integrated backward with raw material sustainability initiative, namely Farmtech, to work closely with farmers and control raw ingredient quality.

The Plant Extracts market major player such as Givaudan SA (Switzerland), International Flavors & Fragrances Inc (US), Symrise (Germany), Sensient Technologies Corporation (US), Synthite Industries Ltd (India), Synergy Flavors Inc. (US), Döhler Group (Germany), Indesso (Indonesia), Vidya Herbs (India), Nutra Green Biotechnology Co. Ltd. (China), and Others.

Givaudan SA is a Swiss multinational company that specializes in fragrances, flavors, and active cosmetic ingredients. The company is also involved in the plant extract market, providing natural ingredients and extracts for use in a variety of industries including food and beverage, personal care, and household products.

International Flavors & Fragrances Inc (IFF) is a  company that specializes in the creation and production of flavors, fragrances, and other specialty ingredients for various consumer goods industries. One of the areas of expertise for IFF is plant extract, which is used in the creation of natural flavors and fragrances. IFF's plant extract portfolio includes a wide range of natural materials, such as herbs, spices, fruits, and flowers. The company uses a variety of extraction methods, including steam distillation, solvent extraction, and supercritical fluid extraction, to isolate and capture the natural aroma and flavor compounds found in these plants.