The global argan oil market demand was pegged at 4,835.5 tons in 2014 and is expected to register a CAGR of 19.6% over the forecast period. The industry is still at a nascent stage and is gaining importance on account of the argon oil’s high-performance ingredients including nutrients and vitamins, namely antioxidant tocopherols, lupeol, omega 3 and omega 6 fatty acids, butyrospermol, triterpenoids, and beta amyrine.
The complex blend of vitamins and nutrients has increased the vitamin E content in the product, which helps in accelerating cell growth and strengthening its antiseptic and anti-inflammatory features. Favorable environmental and technological trends are also contributing significantly to the overall industry demand.
Production of the argon oil not only helps in decreasing deforestation but also in maintaining greenery. Technological advancements are continuously contributing in enhancement of both chemical and microbiological qualities of oil.
Increasing product demand in the medical and food industries is pressurizing main producing areas to raise their production levels in order to meet the demand-supply gap. This gap is expected to increase over the forecast period and thus raising the need for serious initiatives by government to drive overall production levels.
On the basis of application, the global market has been segmented into cosmetics, food, and medical. The cosmetics segment accounted for a volume share of 42.5% in 2014. It is expected to witness stable growth and continue its lead over the forecast period. Cosmetic manufacturers are expected to expand their product lines over the foreseeable future.
The growth of the cosmetics segment is attributed to its wide application scope in skin aging, environment defense, and hair treatment products. Global skincare and haircare manufacturers are increasingly using the oil for advanced cosmetic solutions to ensure healthy skin and hair. Such initiatives are expected to drive the overall industry demand in the cosmetic application segment.
The food segment is also boosting global demand on account of shift in consumer preference for a healthy lifestyle. Healthy and fat free lifestyle accelerates the demand for healthy vegetable oil, including argan. This extract from trees helps in controlling cholesterol levels and boosting energy levels in the human body. The medical application segment is expected to expand at the highest CAGR from 2015 to 2022 on account of increasing usage of the oil in the treatment of serious health problems including cancer, arthritis, obesity, cholesterol level, skin ailments, and skin acne.
On the basis of region, the market has been segmented as North America, Europe, Asia Pacific, Middle East and Africa, and Central and South America. Middle East and Africa was the largest regional market in 2014 and it accounted for 37.9% of the total volume. Middle East and Africa dominated the global industry in terms of volume as the rural economy of the region mainly Morocco, depends on the product for food, shelter, charcoal, livestock feed, and wood. The market is expected to witness slow growth on account of unexplored growth opportunities.
North America was the second largest regional market and is expected to witness maximum growth over the forecast period. Increasing demand for natural and organic cosmetics is expected to drive industry demand in North America. Continuous efforts by research institutions to identify medical potential of the product are expected to enhance the overall consumption levels over the forecast period. Increasing product usage for food applications, including vegetable oil, is also anticipated to boost regional market growth.
The market in Asia Pacific is expected to expand at a significant CAGR owing to growing aging population in countries such as China, India, Japan and South Korea. The product is expected to gain importance in Asia Pacific countries including China and India due to its medical benefits. The market volume in Asia Pacific is expected to increase over the forecast period. Demand for anti-aging creams is increasing in China, India, and Japan, which is anticipated to trigger market growth in this region.
Argan oil is abundantly available in Morocco. There are a number of co-operatives formed in the country for its extraction from kernels. Local women are employed in these co-operatives to produce the oil either manually or through mechanical processes. After extraction, the unrefined item is then sourced to refineries to enhance its quality and properties for application areas, including cosmetics, food, and medical.
Key manufacturers operating in the global market include OLVEA, Zineglob, Biopur and Nadifi Argan. On account of limited production, there are only a few refiners in the industry to cater to the product demand through sellers, distributors, and traders. Considering the limited supply, the value chain is well established and the distribution network ensures uniform availability of the product globally.
Key companies involved in the distribution services include Argan Oils (distributor), The Moroccan Argan Oil Inc. (seller/marketer), Argan Export Company (trader), and Simply Agadir (trader). A wide range of end users is available in the market and the number is expected to increase owing to the product’s widening application base in industries such as medical and food.
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