Essential Oil Market - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

Essential Oil Market - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

The global essential oil market is projected to register a CAGR of 8.6% during the forecast period (2022 - 2027).

Although the COVID-19 pandemic had a disturbing impact on several industries, the essential oils market experienced positive growth during this period. Essential oils have antimicrobial, antioxidant, and anti-infective properties; thus, they are utilized in treating various health conditions, including stress conditions, immunity disorders, sleep disorders, and depression. Therefore, the importance of the essential oils market has shot up during the pandemic as the number of patients with mental health problems raised, which has propelled the growth of the market.

The market is majorly driven by the health benefits offered by essential oils. Therefore, the market witnessed robust growth in its application, as they are now used in almost every industry, starting from food and beverage industries to medicines and animal feed, along with its presence in personal care products. Additionally, the other benefits they possess, such as no side effects, surged their use in the medicine and food and beverage industries. In addition, the rising demand for natural and organic essential oils from health-conscious consumers is further boosting the market growth. Furthermore, the increasing R&D activities, along with innovation in extraction techniques, are expected to bolster the growth of the market in emerging economies.

The sales of essential oils through retail outlets were witnessed. However, the prominence of internet-based online sales is poised to increase over the coming years, as most the importers and wholesalers launch websites for online sales, in addition to the existing over-the-counter sales.

The demand for lavender essential oil witnessed a significantly increasing trend, owing to the benefits it possesses, such as eliminating harmful bacteria, relieving muscle spasms, relieving flatulence, disinfecting and soothing inflamed skin, especially when resulting from a venomous, itchy bug bite, promote speedy healing of irritated and scarred skin, and relieve muscle tension when used during a massage. When used in aromatherapy, this mild sedative is reputed to reduce stress by relaxing the brain waves, which is also said to reduce cortisol levels that contribute to the stress hormone. Due to its calming and relaxing properties, it is also used as a sleep aid for those suffering from insomnia. Diluted with a carrier oil, it is also used as a lavender oil that moisturizes chapped and aging skin. Its potential to restore skin complexion is also demonstrated by its use on aging and acne-prone skin. In hair care, lavender is known to be an anti-septic that effectively eliminates lice, nits, and dandruff when rubbed into the scalp.

North America accounts for the largest share of the global market. In developed regions, such as United States, the stress levels among people increased in recent years, owing to the fast-paced lifestyle, thus, increasing the growth of the essential oil market. Additionally, due to the rising disposable income of consumers, especially in the developing regions, the consumers are willing to spend a premium amount on natural, healthy, and nutritional products. In addition, the number of recreational and lifestyle users has constantly increased in recent years in the North American region, which is further increasing the demand for essential oils in the spa and relaxation and aromatherapy industries. Furthermore, an increase in the demand for energy and health drinks has been witnessed in recent years in the region, which has led to the increased use of essential oils in beverages.

The global market for essential oil is fragmented, owing to the presence of large regional and domestic players in different countries. Emphasis is given to the merger, expansion, acquisition, and partnership of the companies, along with new product development as strategic approaches adopted by the leading companies to boost their brand presence among consumers. Some of the major players such as Fakhry & Co. Lebermuth, Inc. Herbal Family, KATO Flavors & Fragrances (KFF), Robertet, Biolandes, Sydney Essential Oils Co. Pty Ltd, Young Living Essential Oils, Farotti SRL, Food Base Kft, and Givaudan SA.

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