The global botanicals extract market is forecasted to witness a CAGR of 6.63%, during the period 2022-2027.
The COVID-19 situation seems to be lightening up, and the agricultural industries, including fruits, flowers, spices, and herbs, all over the world, are still facing a myriad of problems. In addition, food prices crept up across Europe during the lockdown, as food growers struggle with supply chains disrupted by measures against the COVID-19 pandemic. The raw materials required for the processing of botanical ingredients include agricultural commodities, like fruits, vegetables, herbs, and others. Despite the positive global food market fundamentals, prolonged lockdowns and lasting disruptions in global transport logistics, restrictions on exports, and hoarding by importing countries can affect the availability and prices of food ingredients, including botanical ingredients.However, owing to the spread of COVID-19, consumers have become aware of the utilization of synthetic chemical-based food and skincare products and are moving toward natural colorant-based plant juice products since they provide better and long-lasting protection from virus and bacteria. Thus, the market for botanical ingredients is expected to witness major growth over the forecast period.
Over the medium term, consumers who want clean-label and sustainable ingredients are attracted to products that contain botanicals. This is especially true in beverages, where botanical flavors add a refreshing and natural “pop” to aromatic formulations. However, the use of botanical ingredients, such as sage leaf and rose petal, is also growing in categories, including bakery, dairy, and confectionery.In foods and beverages, consumers tend to consider botanical “premium” ingredients. Local palates and availability dictate which botanicals are most popular. For example, Kerry’s new white paper “Flourishing with Botanicals,” which centers on the food and beverage botanical trend in Europe, found that fruit, cocoa, vanilla, coffee, tea, and floral botanicals are preferred by consumers in the region. Botanical extracts can be found in a growing number of product launches across all major segments, from beverages to baked goods and dairy products or savory categories, such as soups, sauces, and snacks. Likewise, they play an increasing role in plant-based dairy and meat alternatives, providing both sensory value and transparency in terms of product labeling.
Key Market Trends
Wide Application and Functionality of Botanicals
With the advent of new segments, such as functional foods, cosmeceuticals, and animal feed, the market for herbs and botanicals has changed significantly over the past decade. This has opened new opportunities for manufacturers, allowing them to position botanicals and other natural ingredients in products that no longer have to compete with only synthetic and medicinal ingredients. The cosmetic and personal care segment is predicted to augment substantial gain in the market for botanical ingredients over the coming years. Producers of botanical skincare ingredients are providing natural ingredients with consumer safety and high-quality standards. The cosmetic and personal care companies are constantly discovering novel herbal ingredients, as buyers are inclining more toward natural ingredients-based products. In response to the ongoing demand from the cosmetic industry, the ingredient companies are also increasing their research and development to provide the cosmetic and personal care industry with innovative botanical extracts. For instance, in 2020, Givaudan Active Beauty targeted the increasingly popular J-Beauty trend with the launch of 8 botanical extracts for smoother and glowing skin.
Europe Holds the Largest Market Share
Europe holds a relatively large market share among other European countries in terms of consumption of various botanical extracts, like essential oils, spices, and herbs. Spain is a major producer of paprika and saffron, which are traded globally. The majority of Spanish saffron is exported to the United States and other countries. Germany has emerged to be the leading market in the region. The country is also one of the leading importers of spices and herbs in the European market. Evolving consumer taste preferences, healthy living habits, and convenience are the primary factors that are boosting the botanical extract market in the region. Extracts such as laurel, garlic, rosemary, oregano, cayenne pepper, and Nora are widely used in Spanish dishes. The French cosmetic industry is also moving toward natural and clean products. Thus, increasing the demand for botanical extracts. Moreover, there is a growing trend of organic spice consumption in the region. Consumers are inclining toward herbal drinks, teas, and infusions. Therefore, to meet consumers’ demand, various companies are innovating and introducing products.
The botanicals market is highly fragmented, with numerous global and regional players operating in the market. However, global players, such as International Flavors & Fragrances Inc., Bell Flavors & Fragrances, Firmenich SA, Martin Bauer Group, and Givaudan, dominated the market studied with their extensive product offering, coupled with their growth strategies. The prominent market players have been focusing on developing new and innovative products by targeting new formulations. Additionally, these companies have been focusing on increasing the production capacities of their existing plants or introducing new production facilities while investing in R&D activities. Thus, the market studied is expected to witness significant growth in product innovation while keeping expansion as a business interest, to reach a diverse set of consumers within a short-term period.
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1.2 Scope of the Study
4.2 Market Restraints
4.3 Porter's Five Forces Analysis
4.3.1 Threat of New Entrants
4.3.2 Bargaining Power of Buyers/Consumers
4.3.3 Bargaining Power of Suppliers
4.3.4 Threat of Substitute Products
4.3.5 Intensity of Competitive Rivalry
5.1.4 Other Sources
5.2 by Application
5.2.1 Food and Beverage
220.127.116.11 Bakery and Confectionery
18.104.22.168 Sauces and Dressings
22.214.171.124 Functional Beverages
126.96.36.199 Other Food and Beverages
5.2.2 Dietary Supplements
5.2.3 Animal Feed
5.2.4 Other Applications
5.3 by Geography
5.3.1 North America
188.8.131.52 United States
184.108.40.206 Rest of North America
220.127.116.11 United Kingdom
18.104.22.168 Rest of Europe
22.214.171.124 Rest of Asia-Pacific
5.3.4 South America
126.96.36.199 Rest of South America
5.3.5 Middle-East and Africa
188.8.131.52 Saudi Arabia
184.108.40.206 South Africa
220.127.116.11 Rest of Middle-East and Africa
6.2 Market Positioning Analysis
6.3 Company Profiles
6.3.1 Kalsec Inc.
6.3.2 Firmenich Sa
6.3.3 Lipoid Kosmetik AG
6.3.4 Blue Sky Botanics Ltd
6.3.5 International Flavors & Fragrances Inc.
6.3.6 Ransom Naturals Ltd (Obg Pharmaceuticals Ltd)
6.3.7 Bell Flavors & Fragrances
6.3.8 Nagase & Co. Ltd (Prinova)
6.3.9 Martin Bauer Group
A selection of companies mentioned in this report includes:
- Kalsec Inc.
- Firmenich SA
- Lipoid Kosmetik AG
- Blue Sky Botanics Ltd
- International Flavors & Fragrances Inc.
- Ransom Naturals Ltd (OBG Pharmaceuticals Ltd)
- Bell Flavors & Fragrances
- NAGASE & CO. LTD (Prinova)
- Martin Bauer Group