The global essential oil market has been predicted to develop a vastly concentrated vendor landscape where new ventures could encounter high entry barriers created due to maximum shares captured by leading companies. In the coming years, the competition in the market, according to Transparency Market Research (TMR), could intensify on account of the telling increase in product and service extensions authored by key firms. In a bid to expand their regional reach and sales in the market, companies have been anticipated to consider the acquisition of distributors and engagement into new partnerships.
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As per TMR, the global essential oil market could bag a revenue valuation of US$27.4 bn by the completion of 2022 at a CAGR of 9.6% during the forecast period 2017-2022. In 2017, the market had held a valuation of US$17.36 bn. In terms of type of product, the market has been projected to reward citrus oil with a greater demand in the coming years. By region, Europe could take a leading position in the market while rising at an 8.8% CAGR.
Strong Demand for Natural and Bio-based Products Bodes Well
The world essential oil market has been forecast to grow substantially because of the rising inclination of consumers toward natural products. Producers have been taking to the utilization of more natural and bio-based products on account of consumers showing great interest in staying aware about the various ingredients in cosmetics, skincare products, beverages, and foods. The rise in the interest of consumers could be a result of swelling concerns regarding the environmental pollution from chemicals. This has been prophesied to significantly reflect on the growth of the market in the near future.
The growing usage of essential oil in aromatherapy could be an important factor improving the demand in the coming years. The application of essential oil in the production of new fragrances demanded with the rise in the manufacture of novel personal care and beauty products has been foreseen to set the tone for a valuable growth in the world essential oil market.
Expensive Price of Essential Oil Products Deters Growth
Despite the impressive growth of the international essential oil market, there could be a few challenges to be faced with, such as high price of products. Lack of awareness among consumers about the benefits of using essential oil has been predicted to slow down the growth of the market. However, the propelling demand for essential oil in a variety of natural remedies and therapies could improve market growth in the foreseeable future. Some of the key industries for essential oil include personal care and cosmetics and food and beverages. The significant demand for cosmetic and beauty products and natural nutraceuticals could be crucial for players to cash in on.
Increasing disposable income and growing industrialization could be other factors enhancing market growth in the coming years. The application of essential oil in the pharmaceutical industry has been expected to create some opportunities in the market.