Global Aroma Chemicals Market; By Source, By Chemicals, By Application, as well as By Region and Companies - Industry Segment Outlook, Market Assessment, Competition Scenario, Trends, and Forecast: 2023-2032

Report Overview

The global aroma chemicals market was valued at USD 5.35 billion in 2020. This market is expected to reach USD 7.54 billion at a CAGR of 2.9% during the forecast period (2023-32). Product demand is expected to grow due to the increased sales of flavor and fragrance products in the food & beverage, soaps & detergents, and cosmetics & toiletries industries. This market report gives a detailed analysis of the Aroma Chemicals market size, share, growth, key trends, competitive landscape, and other key factors.

Global Aroma Chemicals Market Scope:

Source Analysis

The synthetic source sub-segment dominated the market, which accounted for 67.8% of the total revenue shares in 2021. This is due to the growing demand for synthesized aroma products in food & beverage, personal care, and cosmetics, among other industries. The best way to obtain synthetic aroma chemicals is by using modern ingredient industry technologies. To reproduce different natural aromas, these products employ different kinds of chemicals.

Naturally, derived aroma chemicals are a major source of aroma products. They are extracted using natural extraction methods. Globally, people are more aware of the adverse effects of artificial additives in various products.

In certain cases, natural flavors may interact unexpectedly with other ingredients. It can be hard to create natural flavors or scents because some natural ingredients cannot blend with other fragrances. The high cost of manufacturing natural flavors or scents is an element that could restrict the aroma chemicals market growth.

Chemicals Analysis

Based on chemicals, this aroma chemicals market was dominated by the terpenes/terpenoids sub-segment, which accounted for 36.4% of total revenues in 2021. Its high market share can be attributed to both its natural availability and the increased usage of terpenes in paints and printing inks.

Terpenes can also be used in various end-use applications as flavoring and fragrance agents. The rubber and food & beverage industries consume a large portion of terpenes. Market growth is expected to be impeded by the low supply of raw materials in certain areas and the high cost of extraction.

Because of their increasing commercial significance, the benzenoids sector continues to grow rapidly. Due to their fragrance, they are used in various applications, including soaps, shampoos, detergents, cosmetics, and other personal care products, as well as in food and drinks.

Application Analysis

The fragrance applications sub-segment accounted for the largest share of the aroma chemicals market, amounting to 68.1% of total revenues. This significant share is due to growing demand and further growth into emerging industry areas such as cosmetics, and men’s perfume, among others. These products are anticipated to register significant demand due to the availability of rare ingredients in fine fragrance formulations.

The demand for natural flavoring products drives product manufacturers. Emerging economies can potentially be a major market driver for aroma chemicals. This demand will likely be driven by several factors, such as increasing disposable incomes, the growing demand for beverages and processed foods, the increasing popularity of exotic flavors, and a surge in demand from many food applications like baked goods, convenience foods, and confectionery products.

The demand for unique and organic fragrances and growing consumer awareness concerning organic products are expected to drive the fine fragrance market. PETA-certified organic perfumes are one such example of totally vegan products. The USDA also certifies that their perfumes contain safe, tested, pure ingredients and are free of harmful dyes, petrochemicals or pesticides, solvents, and alcohol. This segment will soon be slated to index a surge in demand for organic perfumes and personal-care products.

Key Market Segmentation

Source

• Synthetic
• Natural
• Natural-Identical

Chemicals

• Benzenoids
• Terpenes & Terpenoids
• Musk Chemicals
• Others (Ketones, Esters, Aldehydes)

Application

• Flavors
  • Convenience Foods
  • Confectionery
  • Dairy Products
  • Bakery Foods
  • Others
• Fragrance
  • Cosmetics and Toiletries
  • Fine Fragrance
  • Soaps and Detergents
  • Others

Market Dynamics

Technological innovations in extracting aroma chemicals and a surge of R&D activities by key industry participants have contributed to the increased adoption of custom-made aroma chemicals for targeted uses. To maintain continuous raw material supply and reduce the final product’s operational costs, manufacturers also focus their efforts on backward integration. These factors have all contributed significantly to boosting product demand.

Aroma chemical producers are working hard to develop natural products that meet stringent environmental requirements. These products’ benefits are also becoming more important to consumers, so suppliers have been forced to integrate themselves into the production process to ensure high-quality standards.

Food is a major factor, and aroma chemicals can enhance processed foods’ flavor. The growth of natural aroma chemicals is driven by increasing demand from the health and wellness food industry, regulations that ban synthetic flavors, and the ban on using them in processed foods. The potential for natural flavors to be used in more applications, the health benefits associated with certain natural flavors, and various technological innovations are key drivers for the aroma chemical market.

Aroma chemicals are used extensively to make additives for food & beverage, personal care, and health products. To gain an advantage in this industry, chemical manufacturers are now focusing on creating natural aroma chemicals with flavors similar to synthetic flavoring agents, considering this evolving product market and subsequent consumer demand.

The growing demand for scents within China, Japan, and India, as well as the increasing significance of organic and natural fragrances, is expected to boost the market’s growth in the region. Rapid urbanization and increasing e-commerce business are driving consumer interest in cosmetic products. Demand for fragrance is increasing in the countries such as Japan, China, and others countries.

The personal care and cosmetics industry is another important market for Aroma Chemicals. It is believed that the personal care industry is booming due to the growing disposable incomes of the population and the increasing demand for top-quality cosmetics. This results from the increasing demand for cosmetics and personal health fragrances. To expand the market, major players focus on expansion, product launches to meet increasing demand from end-use consumers.

These products are used in formulating high-quality flavors and fragrances. End-users include Procter & Gamble, L’Oreal, Shiseido, Cargill Incorporated, Unilever, Delfi Limited, McKee Foods, Dean Foods Company, Nestle, and The Coca-Cola Company other companies.

Regional Analysis

The Asia Pacific was dominant in the aroma chemical market and accounted for the highest revenue share of 31.8% in 2021. This market is expected to experience a 4.8% CAGR between 2023 and 2032. This is due to the growing demand for flavors and fragrances coming from major economies like India, China, and Japan.

In countries such as Canada and the U.S., this product market is expected to grow moderately due to increasing demand for low-carbohydrate and low-fat food & beverages as well as consumer goods combined with an expanding food processing sector. Growing consumer preferences for healthy food and organic cosmetics have increased demand for aroma chemicals.

Key Regions and Countries Covered іn This Rероrt:

• North America
  • US
  • Canada
  • Mexico
• Europe
  • Germany
  • UK
  • France
  • Italy
  • Russia
  • Spain
  • Rest of Europe
• APAC
  • China
  • Japan
  • South Korea
  • India
  • Rest of Asia-Pacific
• South America
  • Brazil
  • Argentina
  • Rest of South America
• Middle East & Africa
  • GCC
  • South Africa
  • Israel
  • Rest of MEA

Market Share Analysis

Market leaders continue to focus on expansion capacity prospects. Chemical companies partner with other companies to create distribution networks in diverse geographies. This ensures optimal coverage. Azelis’ subsidiary SammChem, which distributes specialty chemicals and food additives, partnered up with BASF SE in 2019. This partnership allows the company to distribute aroma ingredients to the flavors & fragrances market.

It is expected that the demand from the end-use industries will continue to grow over the forecast period. Manufacturers are intensifying their efforts to expand their existing product ranges and to introduce natural products to meet future needs for sustainable development. Major players included in the report are BASF SE, Privi Organics India Limited, Takasago International Corporation, Kao Corporation, etc.

Aroma Chemicals Market Key Players

There are several prominent players in the market:

• BASF SE
• Privi Organics India Limited
• Takasago International Corporation
• Kao Corporation
• Bell Flowers & Fragrances
• Givaudan
• S H Kelkar and Company
• Symrise
• Silverline Chemicals Limited
• Other Major Players