Essential Oils Market Forecasts to 2030 – Global Analysis By Type (Lavender Oil, Tea Tree Oil, Peppermint Oil, Lemon Oil and Other Types), Source, Distribution Channel, Application, End User and By Geography

Essential Oils Market Forecasts to 2030 – Global Analysis By Type (Lavender Oil, Tea Tree Oil, Peppermint Oil, Lemon Oil and Other Types), Source, Distribution Channel, Application, End User and By Geography

According to Stratistics MRC, the Global Essential Oils Market is accounted for $11.3 billion in 2024 and is expected to reach $24.7 billion by 2030 growing at a CAGR of 13.8% during the forecast period. Essential oils are concentrated plant extracts that capture the natural aroma and beneficial properties of their source. Obtained through processes like steam distillation or cold pressing, these oils contain the essence of the plant's fragrance and therapeutic qualities. Commonly used in aromatherapy, skincare, and holistic healing, essential oils are valued for their potential to enhance well-being, relieve stress, and treat various ailments. Each oil has unique characteristics and uses, making them versatile tools in natural health practices.

According to the Global Wellness Institute, in 2020 there were over 1,60,000 spas, earning $68 billion in revenue globally. Spa revenue was growing by 8.7% annually prior to 2020.

Market Dynamics:

Driver:

Growing aromatherapy industry

The market is witnessing a surge in demand, fueled by the growing popularity of aromatherapy. Consumers are increasingly seeking natural remedies for health and wellness, driving the expansion of this industry. Aromatherapy, with its therapeutic benefits and pleasant fragrances, is gaining traction as a holistic approach to relaxation and healing. This trend is prompting the introduction of innovative products and the exploration of new applications, further propelling the growth of the market.

Restraint:

Availability of synthetic and substandard products

Despite stringent regulations, some producers cut corners, using cheaper synthetic alternatives or diluting oils with inferior substances. This compromises purity and potency, deceiving consumers and potentially causing adverse effects. The presence of such products underscores the importance of thorough research and sourcing from reputable suppliers. Vigilance and education are essential to safeguard against the risks associated with synthetic and substandard essential oils.

Opportunity:

Increasing demand for natural ingredients

The market is witnessing a surge in demand for natural ingredients. Consumers are increasingly seeking products that are sourced from natural and organic materials due to growing health and environmental concerns. This trend is driving manufacturers to prioritize the use of natural ingredients in their essential oil formulations. As a result, there is a noticeable shift towards plant-based extracts and botanicals, reflecting a broader consumer preference for clean-label and sustainable products.

Threat:

High price of essential oils

The market is marked by soaring prices, often rendering these aromatic extracts unaffordable for many consumers. Factors such as scarcity of raw materials, intricate extraction processes, and growing demand contribute to the steep costs. Additionally, the market's reliance on natural resources susceptible to environmental fluctuations exacerbates price volatility. As a result, accessing these essential oils, renowned for their therapeutic and aromatic properties, becomes a luxury rather than a commonplace indulgence for health and wellness enthusiasts.

Covid-19 Impact:

The COVID-19 pandemic significantly impacted the essential oils industry, altering its definition and perception. Essential oils, traditionally known for their therapeutic and aromatic properties, saw a surge in demand as people sought natural remedies and wellness products amidst health concerns. This heightened interest led to a broader recognition of essential oils for their antiviral and immune-boosting potential. Consequently, the definition of essential oils expanded beyond aromatherapy to encompass their role in supporting overall health and well-being during a global health crisis.

The peppermint oil segment is expected to be the largest during the forecast period

The peppermint oil is expected to be the largest during the forecast period. With its invigorating scent and numerous therapeutic benefits, including promoting digestion and relieving headaches, it enjoys popularity in aromatherapy and holistic wellness practices. As a natural remedy, it's often utilized in skincare, haircare, and household cleaning products, reflecting the growing consumer demand for natural alternatives. Peppermint oil's distinct properties make it a staple in the essential oils market, catering to health-conscious individuals seeking holistic solutions.

The pharmaceutical segment is expected to have the highest CAGR during the forecast period

The pharmaceutical segment is expected to have the highest CAGR during the forecast period. Their antimicrobial, anti-inflammatory, and analgesic properties are increasingly recognized, fostering their utilization in pharmaceutical formulations. This market convergence emphasizes the industry's shift towards holistic healthcare solutions. Key players are leveraging essential oils' versatility to develop innovative products, catering to the growing demand for natural remedies in pharmaceuticals.

Region with largest share:

North America is projected to hold the largest market share during the forecast period driven by increasing consumer interest in natural remedies and aromatherapy. With a diverse range of applications spanning from skincare to holistic wellness, essential oils have become mainstream products in households across the continent. Factors such as rising health consciousness and demand for organic, chemical-free alternatives contribute to the market's expansion.

Region with highest CAGR:

Asia Pacific is projected to hold the highest CAGR over the forecast period. There has been a noticeable increase in demand for essential oils across countries in the region. This demand is fueled by a rising interest in natural and organic products, as well as a growing awareness of the therapeutic benefits of essential oils. Many countries in the region have a long history of traditional medicine practices that incorporate the use of essential oils. This cultural heritage contributes to the widespread acceptance and usage of essential oils in the region.

Key players in the market

Some of the key players in Essential Oils market include Cargill, Takasago International Corporation, VedaOils, Azelis, Turpaz Industries, PT Indika Energy Tbk, Sydney Essential Oil Co., India Essential Oils, DoTerra, Flavex Naturextrakte GmbH, Falcon, Ungerer Limited, Pure Essential Supply Inc., Miracle Botanicals and Sun Essential Oils.

Key Developments:

In October 2023, Azelis, a service provider in the specialty chemicals and food ingredients industry, acquired 100% of the shares of BLH SAS, a distributor of flavors & fragrances focused on the fine perfumery market in France.

In January 2023, PT Indika Energy Tbk (INDY) announced that its diversification into the essential oil industry through its subsidiary, PT Indika Multi Properti (IMP), which acquired a 46% stake in PT Natura Aromatik Nusantara (NAN) for IDR 179.60 billion (~USD 11.55 billion)

Types Covered:
• Lavender Oil
• Tea Tree Oil
• Peppermint Oil
• Lemon Oil
• Other Types

Sources Covered:
• Citrus Oils
• Herb Oils
• Floral Oils
• Wood Oils
• Spice Oils

Distribution Channels Covered:
• Online Retail
• Specialty Stores
• Supermarkets and Hypermarkets
• Direct Sales

Applications Covered:
• Aromatherapy
• Spa and Wellness
• Massage Oil
• Cleaning & Home
• Fragrances
• Animal feed
• Other Applications

End Users Covered:
• Pharmaceutical
• Food & Beverages
• Nutraceuticals
• Personal Care
• Other End Users

Regions Covered:
• North America
US
Canada
Mexico
• Europe
Germany
UK
Italy
France
Spain
Rest of Europe
• Asia Pacific
Japan
China
India
Australia
New Zealand
South Korea
Rest of Asia Pacific
• South America
Argentina
Brazil
Chile
Rest of South America
• Middle East & Africa
Saudi Arabia
UAE
Qatar
South Africa
Rest of Middle East & Africa

What our report offers:
- Market share assessments for the regional and country-level segments
- Strategic recommendations for the new entrants
- Covers Market data for the years 2022, 2023, 2024, 2026, and 2030
- Market Trends (Drivers, Constraints, Opportunities, Threats, Challenges, Investment Opportunities, and recommendations)
- Strategic recommendations in key business segments based on the market estimations
- Competitive landscaping mapping the key common trends
- Company profiling with detailed strategies, financials, and recent developments
- Supply chain trends mapping the latest technological advancements