Natural Extracts Market (By Material: Essential Oils, Oleoresins, Flavonoids, Alkaloids, Carotenoids, Others; By Therapeutic Area: Immunity, Beauty & Aging, Gastro & Digestive, Weight & Wellness, Mental Health, Diabetes, Woman Health, Others; By Application: Pharmaceuticals, Personal Care & Cosmetics, Food & Beverages, Animal Feed , Nutraceuticals, Others) - Global Industry Analysis, Size, Share, Growth, Trends, Regional Outlook, and Forecast 2024 – 2033
The global natural extracts market was valued at USD 12.15 billion in 2023 and it is expected to hit around USD 28.08 billion by 2033, poised to grow at a CAGR of 8.67% from 2024 to 2033.
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The Asia Pacific natural extracts market size was estimated at USD 3.80 billion in 2023 and is predicted to be worth around USD 9.51 billion by 2033, at a CAGR of 9.53% from 2024 to 2033.
Asia Pacific region dominates the natural extracts market. The region includes major emerging economies such as China, India, and Japan, which have a high consumer base for natural & healthy products due to population and income growth. The natural extracts market is driven by an increase in favorable government initiatives regarding awareness about healthy lifestyles. For instance, since 2016, China has been implementing the “Healthy China 2030” policy to promote people's all-round development in the country. Moreover, an increase in production and supply of spices & herbs in India is also driving the market growth in the region. For instance, according to the India Brand Equity Foundation, in 2020-21, ginger export witnessed growth of around 47% from 2019-20, accounting for a 10% year-on-year growth of the total spices export.
About 30.5% of the global revenue for natural extracts was in the European region in 2021. The use of essential oils in cosmetics and fragrances are widely used in the European countries by the manufacturers in the European region. They use essential oils in the production. The global demand for the natural extracts is currently driven by two industries, which is the food and beverages and the personal care. In the developed economies, the demand for the floral extracts or the essential oil is more as the people have high standards of living.
Aromatherapy has a major application of the essential oils and the aromatherapy sector is growing in the European nations. Germany, Austria, France and Switzerland are the major markets for aromatherapy. Other significant markets for aromatherapy are Netherlands and UK. Europe is an exporter and a manufacturer of pharmaceutical products that use natural extracts. An increase in this areas aging population is also expected to drive the demand for pharmaceuticals and neutraceuticals in this region. Constant research and developmental activities to produce natural products are expected to drive the market and awareness about the concept of healthy aging and an increasing health conscious diet is also driving the market. The deficiency of essential micronutrients, or the inclusion of synthetic products in the US has led to an increase in the cases of obesity, cardiovascular diseases, Osteoporosis. Therefore, there is a great demand for plant extracts in food and beverages.
The North America natural extracts market size was calculated at USD 3.42 billion in 2023 and is estimated to cross around USD 7.37 billion by 2033 with a significant CAGR of 7.89% from 2024 to 2033.
| Year | Market Size (USD Billion) |
| 2023 | 3.42 |
| 2024 | 3.72 |
| 2025 | 4.03 |
| 2026 | 4.38 |
| 2027 | 4.76 |
| 2028 | 5.17 |
| 2029 | 5.60 |
| 2030 | 6.05 |
| 2031 | 6.48 |
| 2032 | 6.93 |
| 2033 | 7.37 |
Natural extracts are the ingredients that are derived from natural sources like vegetables, fruits, plants, grains, meat, or even seafood. These natural products provide an additional benefits to the consumers for better health, beauty etc. The natural extracts are used in many applications like flavors, edible oils colorants etc. It is the most demanding ingredient for essential oils, fragrances, flavors and spices. It has great application in food and beverage industry and the pharmaceutical industry. These ingredients do not just provide flavor, but are also healthy as they serve many vitamins, carbohydrates and minerals. The unavailability of various raw materials and increased prices of these raw materials shall hinder the growth of the market.
Due to an increase in the trend of vegetarianism or veganism the natural extracts market is expected to boost. The increased consumer awareness, increased adoption of natural ingredient based products, change in the lifestyle and bio technological advancements are driving the market. The increase in the consumer's disposable income, research and development, growth of the agricultural industry, aging population, imports and exports and the growth in the population are all positively affecting the growth of the natural extracts market. Natural extracts are very popular among the consumers as they do not have any detrimental side effects like those that are chemical based. They see applications in personal care and cosmetics, food and beverage products and pharmaceuticals. The overall health benefits that are provided by the natural extracts are expected to create a demand for this product. In various industries due to increasing application in terms of flavors and fragrances. The North American region is the second highest market for the essential oils. The increased use of natural ingredients based product by all the consumers is expected to escalate the growth of this market.
| Report Coverage | Details |
| Growth Rate from 2024 to 2033 | CAGR of 8.67% |
| Market Size in 2023 | USD 12.15 Billion |
| Market Size by 2033 | USD 28.08 Billion |
| Base Year | 2023 |
| Forecast Period | 2024 to 2033 |
| Segments Covered | By Material, By Therapeutic Area, and By Application |
| Regions Covered | North America, Europe, Asia-Pacific, Latin America, and Middle East & Africa |
Market Drivers
Rising Personal Disposable Income
Products containing natural extracts are gaining popularity among the consumers due to a rise in their disposable income. These extracts require advanced biotechnologies for extraction and processing. They also require proper supply chain and logistics for transportation, as these extracts are void of preservatives and other artificial ingredients to keep them fresh.
Moreover, an increase in personal disposable income around the world is accelerating the market growth, as consumers have high purchasing power and awareness of these products. For instance, according to the World Bank data, global GDP per capita increased from US$ 10,936.1 in 2020 to US$ 12,262.9 in 2021. Likewise, according to the Organisation for Economic Co-operation and Development, Gross per capita, percentage change of household disposable income in the U.S. grew by 2.54% in 2021 and the same rose in the U.K. by 0.79% in 2021.
Furthermore, a rise in income enables consumers to spend more on innovative products. Natural extract products include food & beverages, cosmetics such as hair care & skin care products, pharmaceuticals and others.
Health Benefits Associated with Natural Extracts
Natural extracts are widely preferred for food & beverages, personal care, and medicinal applications. Consumers are preferring these products to improve their lifestyles. Due to hectic working hours, reduction in physical activities, and rising adulteration in the products, natural extract is gaining popularity among consumers.
Moreover, consumers are choosing natural extracts according to their requirement related to health, which is also boosting the market growth. Natural extracts such as essential oils and oleoresins carry various health benefits for treating diseases as well as preventive care. People adopt natural products for preventing respiratory, digestive diseases, and other diseases such as asthma, cancer, diabetes, blood pressure fluctuations, headaches, and others.
An increase in the prevalence of diseases such as cardiovascular, chronic, respiratory and others is driving the market growth to treat and manage health issues. According to the American Diabetes Association, in 2019, 11.3% of the U.S. population i.e., 37.3 million had diabetes. Also, according to the World Health Organization, in 2020, cancer caused around 10 million deaths around the world. Likewise, according to May 2022 data of the same source, food contamination makes 600 million people in the world fall ill and 420,000 die every year.
Thus, due to the rising number of diseases, consumers are becoming more aware about their food consumption and maintaining healthy lifestyle, which is in turn driving the market growth.
Market Restraints
Availability of Low-cost Alternatives
The global natural extracts industry is rapidly growing; however, some factors such as the availability of low-cost alternatives limit the market growth. Currently, natural extracts are price sensitive as they go through advanced production methods and their availability is limited. They are commonly available in urban cities; however, due to supply chain & cold storage complexities, these products are not extensively consumed in rural regions. This results in the consumption of low-cost synthetic substitutes.
Moreover, other factors which make natural extracts price sensitive are crop yield, climate, import/export, agriculture laws, and others. Natural extracts are more expensive than synthetic & chemical counterparts due to high cost related to extraction, purification, and concentration processes. The aforementioned factors contribute to the high prices of natural extracts, which is expected to be a major restraint for the natural extracts market growth.
Market Opportunity
Increasing Adoption of Natural Extracts in End-use Applications
The growth in personal care & cosmetics, pharmaceuticals, food & beverages, nutraceuticals applications is creating lucrative growth for natural extracts. These extracts have major benefits and uses in these applications which have various benefits such as improving skin care, mental illness, food intake and others. Thereby, many companies related to end-use applications are undertaking initiatives to expand the demand for organic and natural products.
Significant growth of the cosmetics market around the world is accelerating the market growth. For instance, according to France-based personal care company, L'ORÉAL’s annual report of 2021, the growth of the global cosmetics market witnessed an increase from 4.9% in 2017 to 8.2% in 2021. Likewise, according to the Food and Agriculture Organization 2021 data, in 2019, the global sales of organic food and drink reached over US$ 107 billion.
Hence, the rising demand for natural ingredients for end-use applications is expected to create a profitable opportunity for the market growth over the forecast period.
The essential oil segment held the largest share of 60% in the natural extracts market in 2023. In the natural extracts market, the essential oil segment has grown significantly in the last several years. Essential oils are concentrated plant extracts that preserve the aroma and spirit of the source plant. Growing consumer knowledge of wellness and health is driving a move toward natural and organic products. The demand for essential oils is driven by their perception as natural cures and substitutes for artificial scents and chemicals. The usage of essential oils in aromatherapy products has grown as a result of theories about its many health advantages, which include stress alleviation, relaxation, and mood enhancement. Because of their scent and possible skincare advantages, essential oils are frequently utilized in cosmetic and personal care products. They help the market expand by adding goods like shampoos, lotions, soaps, and perfumes.
The beauty & aging segment held the largest share of 29% in the natural extracts market in 2023. Many individuals have serious concerns about aging and beauty, and the market for natural extracts presents a possible solution for these problems. Because they are thought to be safer and more effective than synthetic compounds, natural extracts made from fruits, vegetables, herbs, and other natural sources are becoming more and more popular in the cosmetics business. Vitamins, antioxidants, and other health-promoting elements are frequently found in these extracts, which can support collagen synthesis, preserve skin health, and lessen the appearance of aging. Age-related declines in the body's naturally occurring levels of CoQ10. CoQ10, which is extracted from foods like soybeans, guards against UV damage and lessens the look of wrinkles and fine lines.
The food & beverages segment held the largest share of 45% in the natural extracts market in 2023. Soft drink flavors are derived from natural extracts such as fruit juices, herbal infusions, and botanical extracts. Teas and coffees are flavored with natural extracts including vanilla, cinnamon, mint, and various fruit extracts. Cocktails, flavored spirits, and liqueurs are made using natural extracts such as fruit juices, spices, and herbs. Natural extracts are frequently found in chocolates, candies, and chewing gum flavors such as vanilla, mint, citrus, and fruit. These are but a handful of the wide variety of food and drink items that include natural extracts. The market for natural extracts is anticipated to expand as food and beverage producers try to satisfy consumers' increased demands for natural ingredients and clean labels.
Natural Extracts Market, By Application, 2020-2023 (USD Million)
| By Application | 2020 | 2021 | 2022 | 2023 |
| Pharmaceuticals | 898.4 | 970.9 | 1,056.90 | 1,156.00 |
| Personal Care & Cosmetics | 2,824.90 | 3,044.10 | 3,304.20 | 3,603.70 |
| Food & Beverages | 4,314.90 | 4,627.60 | 4,999.00 | 5,426.10 |
| Animal Feed | 410 | 437.7 | 470.70 | 508.60 |
| Nutraceuticals | 616.3 | 677.3 | 749.60 | 833.10 |
| Others | 507 | 540 | 579.30 | 624.30 |
Segments Covered in the Report
By Material
By Therapeutic Area
By Application
By Geography
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