Natural Extracts Market Gains Traction in Plant-Based Food Product Development

The global natural extracts market size was valued at USD 9.57 billion in 2020 and is projected to reach USD 18.95 billion by 2028, growing at a CAGR of 8.9% from 2021 to 2028. The market is driven by factors such as increasing consumer awareness, changing lifestyles, greater adoption of natural ingredient-based products, and advancements in biotechnology.

In addition, macroeconomic factors including rising consumer disposable incomes, growth in R&D, imports and exports, expansion of the agriculture industry, an aging population, and overall population growth have significantly contributed to market demand. Natural extracts are widely used across industries such as food and beverage, cosmetics, perfumery, pharmaceuticals, and nutraceuticals.

Unlike many chemical-based ingredients, natural extracts pose no harmful side effects when used in personal care, cosmetics, pharmaceuticals, and food and beverage products. The focus on ecological and naturally sourced ingredients has become a key priority for manufacturers, particularly in North America and Europe. The numerous health benefits linked with natural extracts are expected to further strengthen their demand in pharmaceutical and nutraceutical applications in the near future.

North America represents the second-largest market for essential oils, driven largely by their applications in flavors and fragrances used in food, beverages, and medicinal products. The presence of well-established food, beverage, and pharmaceutical industries has further supported the growth of the essential oils market in the region.

Despite strong growth, the industry faces challenges such as limited advanced biotechnologies for extraction in low-income economies, supply chain inefficiencies, and price sensitivity. In addition, awareness of organic cultivation and chemical-free production remains relatively low in developing nations such as India and China. This lack of awareness hampers opportunities for growers and suppliers to meet the standards of organic-certified products, which are in high demand across European markets.

Key Market Trends & Insights

• Regional Leadership: Europe dominated the market with over 30.0% share of global revenue in 2020.
• Product Segment: Dried crops led the market with a revenue share of nearly 40.0% in 2020.
• Application Segment: Food and beverage applications accounted for about 46.0% of market share in 2020 and are expected to maintain dominance throughout the forecast period.

Market Size & Forecast

• 2020 Market Size: USD 9.57 Billion
• 2028 Projected Market Size: USD 18.95 Billion
• CAGR (2021-2028): 8.9%
• Europe: Largest regional market in 2020

Order a free sample PDF of the Natural Extracts Market Intelligence Study, published by Grand View Research.

Key Companies & Market Share Insights

Manufacturers of natural extracts—including essential oils, oleoresins, herbal extracts, natural colors, and dried crops—are increasingly focusing on R&D initiatives to launch improved and innovative products. Collaborations and partnerships with other companies allow them to address customer-specific requirements more effectively.

To enhance production efficiency, companies are investing in advanced manufacturing technologies that reduce costs and time. Some manufacturers are pursuing backward integration strategies by acquiring or collaborating with raw material suppliers. For example, Synthite Industries Ltd. has launched Farmtech, an initiative to promote sustainability and quality control by working directly with farmers.

Maintaining the quality and shelf life of essential oils remains a major concern, leading companies to adopt safe handling and storage practices. In Europe, essential oils can only be exported if they meet the European Union’s stringent legal standards for cosmetics and natural ingredients.

Recent Developments

• May 2022: Arjuna Natural launched a post-workout pain reliever, offering consumers a safe herbal solution for instant pain relief.
• March 2022: Symrise partnered with CRIEPPAM on a bio-regeneration project for White Lavender, advancing the next generation of White Lavender plants.
• August 2020: Symrise introduced SymControl Scalp, a product addressing sebum overproduction using natural extracts from Tetraselmis Suecica.

Prominent Market Players

• Symrise
• Kancor
• Synthite Industries Ltd.
• Ransom Naturals Ltd.
• India Essential Oils
• G. Industries
• Flavex Naturextrakte GmbH
• Arjuna Natural Pvt. Ltd.
• Firmenich SA
• Robertet Group
• Sami Spices
• doTERRA

Explore Horizon Databook – The world's most expansive market intelligence platform developed by Grand View Research.

Conclusion

The global natural extracts market is witnessing strong growth, fueled by the rising preference for natural and safe ingredients across diverse industries such as food and beverages, pharmaceuticals, nutraceuticals, and cosmetics. While challenges related to supply chains, technological limitations, and low organic farming awareness in emerging economies persist, opportunities for innovation, sustainable sourcing, and advanced extraction technologies are expected to drive future growth. With Europe leading the market and North America following closely, the industry is set for significant expansion as consumers increasingly prioritize health, sustainability, and natural product benefits.

browse our blog: https://globalindustryherald.com