Essential Oil Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)
The essential oil market is projected to register a CAGR of 8.6% during the forecast period (2020 - 2025).
The demand for lavender essential oil witnessed a significantly increasing trend, owing to the benefits it possesses, such as eliminate harmful bacteria, relieve muscle spasms, relieve flatulence, disinfect and soothe 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 in the global market. In the developed regions, such as the 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 is 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 on 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. For instance, Young Living Essential Oils, a key player in the essential oils market, acquired Life Matters, a wellness company in direct selling industry, in a non-cash deal to strengthen and expand its business presence and product portfolio.