According to a recent study by Transparency Market Research (TMR), the global natural fragrance ingredients market is moderately consolidated with top four players holding 56.5% of the shares in 2015. These four players are Firmenich SA., Givaudan SA, IFF, and Symrise AG. As a common strategy, most of these companies are actively pursuing to expand their horizons in the emerging economies in order to make the most of the untapped opportunities, and are expected to remain ahead of the competition in the near future. According to the evaluations in the TMR report, the global natural fragrance ingredients market had an opportunity worth US$3.3 bn in 2015, which will increase up to US$5.3 bn by the end of 2024, expanding at a CAGR of 5.8% during the forecast period of 2016 to 2024.
Asia Pacific Presenting Lucrative Opportunities
Product-wise, the report segments the global natural fragrance ingredients market into flower based, musk based, wood based, spice based, fruit based, and others including grass. Though most of these segments continue to have significant demand, stiff competition continues to come from synthetic aromas, which are cheaper. However, growing demand for organic products for their health benefits is expected to propel the demand for these natural fragrance ingredients products in the near future.
Application-wise, the report categorizes the market into household care and cosmetics, and rates cosmetics as the most important segment, wherein anti-aging products dominate the demand from the developed regions while fairness products lead from Asia Pacific, especially India which houses over a billion people. Geographically, Europe continues to be the most important region, expected to account for 29.74% of the demand by 2024. Presence of several leading companies in countries such as France, Germany, and Italy is a major driver of strong demand for natural fragrance ingredients from Europe. However, increasing disposable income and trend of personal care is anticipated to expand the horizons of the natural fragrance ingredients market in Asia Pacific during the forecast period.
Increasing Disposable Income Driving Demand
Globalization with rapid urbanization in several emerging economies is playing a primary role in augmenting the demand in the natural fragrance ingredients market. Consumers are now aware of ill-effects of synthetic products and hence are shifting toward natural or organic products. Besides constant demand from developed countries such as the U.S., France, and U.K, strengthening GDP of countries such as India, China, Japan, and South Korea is augmenting the demand for luxury products, which is expected to positively reflect on the global natural fragrance ingredients market.
These ingredients are now used for the manufacturing of several products including soaps, creams, car air fresheners, lotions, perfumes, and deodorants. This extended product range is another favorable factor for this market. Increasing disposable income and the emergence of mass middle class are other factors driving the demand in the global natural fragrance ingredients market. Conversely, high cost of natural ingredients when compared to synthetic products and growing environmental concerns due to the loss of natural resources is hindering the growth rate of the market. For example, musk deer is on the verge of extinction owning to continued poaching for the extraction of musk.
According to the author of the report, “Awareness pertaining to the benefits of organic product is turning into a trend across the globe, which will open new opportunities for the players in this market.”
The information presented in this review is based on a Transparency Market Research report, titled, “Natural Fragrance Ingredients Market (Product - Flower Based, Wood Based, Musk Based, Fruit Based, and Spice Based; Application: Household Care and Cosmetics) - Global Industry Analysis, Trend, Size, Share and Forecast 2016 - 2024.”
Key Segments of the Global Natural Fragrance Ingredients Market
Global Natural Fragrance Ingredients Market, By Product Type
Global Natural Fragrance Ingredients Market, By Application
Global Natural Fragrance Ingredients Market, By Geography
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