Aroma Chemicals Market Size, Share & Trends Analysis Report By Source (Natural, Synthetic), By Chemicals, By Application (Flavors, Fragrances), By Region, And Segment Forecasts, 2022 - 2030

Report Overview

The global aroma chemicals market size was valued at USD 5.35 billion in 2021 and is expected to expand at a compound annual growth rate (CAGR) of 4.1% from 2022 to 2030. The growth is attributed to increased consumption of flavors & fragrance products in the cosmetics & toiletries, soaps & detergents, and food & beverages industries. Aroma chemicals are witnessing an increase in demand owing to the growing application scope in key end-use industries such as dairy, cosmetics & toiletries, soaps & detergents, fine fragrances, convenience foods, bakery foods, and confectionery. Moreover, increasing demand for low calories drinks and growth in the beverages market, are the major factors driving the growth of the industry.

Flavors being a prominent factor in taste in edible products, aroma chemicals are utilized to augment the taste in beverages and processed food. Increasing demand for health and wellness foods, regulation, and the ban on the use of some synthetic flavors are triggering the growth of natural aroma chemicals. The suitability of natural flavors in wider applications, additional health benefits of certain natural flavors, and advanced technological innovation are the key factors driving the market growth.

Amid the COVID-19 pandemic, the World Health Organization (WHO) has stated some guidelines for maintaining water hygiene and its sanitation. According to these guidelines, consistent washing and cleanliness in households, communities, marketplaces, schools, healthcare facilities, and prisons can help avoid human transmission of the coronavirus. This has fuelled the demand for soaps and detergents across the most infected regions of the world.

Customers are reallocating their finances from non-essentials to stockpile essentials, including disinfectants and hygiene and cleaning products. In India, the immediate impact of COVID-19 on hygiene product categories was recorded in March 2020. The hygiene products category witnessed an increase of 25% and 60% in demand for floor cleaners and hand washes, respectively. All these factors contribute significantly to the demand for aroma chemicals used in soaps and detergents.

Source Insights

The synthetic source segment dominated the market with a revenue share of 67.98% in 2021. This is attributed to the rising utilization of synthetic products in cosmetics, personal care, and food & beverages. Synthetic aromas are one of the essential ingredients for the production of custom and fine fragrances. Synthetic aromas are widely used in cosmetics for all users such as women, men, and also for children. Owing to easy availability and low cost of production, the demand for synthetic products is projected to grow rapidly.

Natural-identical aromas are chemically defined substances possessing aromatic properties. Natural-identical aromas are obtained by isolation or chemical synthesis using various chemical reactions such as acetylation and esterification. Raw materials required for the production of natural-identical aromas are chemically identical to natural substances derived from animal or plant sources.

At present, a majority of flavors and fragrances are formulated chemically. Nonetheless, the consumer demand from the food industries is influenced severely due to the environmentally unfriendly manufacturing process. This may result in a consumer shift from chemically processed products to naturally extracted aromatic substances.

On the other hand, availability and financial factors play a vital role in the consumption of natural aromatic sources, as a result, it becomes impossible to cater to the need for natural aromas. For instance, the purest form of vanilla obtained from bourbon vanilla has limited availability and is expensive; as a result, consumers prefer synthetic and natural-identical alternatives of the same.

Chemicals Insights

The terpenes & terpenoids segment dominated the aroma chemicals market with a revenue share of 37.50% in 2021. The high share is attributable to the product’s natural availability as well as the growing utilization of terpenes resin in paints & printing inks, rubber adhesives, pressure-sensitive tapes, and chewing gums, among others.

Musk chemicals are extracted synthetically as well as naturally. Natural musk is extracted from plant roots and seeds, and the rump gland of musk deer, muskrats, and civet cats. Musk chemicals find wide scope in different applications such as soaps & detergents, cosmetics & personal care products, food, and household products, among others.

The increasing working-class population, growing middle-class population, and growing inclination of consumers toward branded products, especially in the developed economies are some of the prominent trends in the musk chemicals market. Additionally, the rising importance of grooming among adults and teenagers is estimated to propel product demand. Similarly, the rising popularity of different types of personal care items and fine fragrances are also expected to trigger the demand for musk chemicals.

Application Insights

The fragrance application segment held the leading revenue share of 68.82% in 2021. The high share of the segment is attributable to surging demand for beverages & processed foods, growing disposable income, the rising popularity of exotic flavors, as well as increasing demand for several food applications such as convenience foods, confectionery, dairy, and bakery.

Aroma chemicals are blended by perfumers to create fine fragrances which can be both light and strong in nature. Cinnamaldehyde is utilized as a raw material for the formulation of fine fragrances such as cinnamyl alcohol (lilac), and dihydrocinnamyl alcohol (hyacinth), among others.

Allyl hexanoate is also utilized in fine fragrances to imbue wisteria, peach blossom, and apple blossom fragrances, among others. Considering the availability of unique ingredients for fine fragrance formulations, aroma chemicals are estimated to witness substantial demand over the forecast period.

Convenience food is one of the fastest-growing food markets, driven by busy lifestyles and an aging population. Aroma chemicals are used to enhance the flavor of several convenience products namely candies, snacks, chips, soups, and soft drinks, among others. Also, some natural ingredients are utilized to preserve food products and make them palatable. Formulation of convenience foods is difficult without aroma chemicals owing to their capabilities to act as processing agents, nutritional additives, sensory agents, and preservatives, which have significantly contributed to the product demand.

Flavors are also broadly used for several non-alcoholic beverages including juices, coffee, tea, shakes & smoothies, health drinks, and protein shakes. The coffee category is one of the major consumers of flavor ingredients owing to taste profile, regional requirement, price point, and desired caffeine levels. The growing population coupled with a high demand for varied coffee beverages across the globe has triggered the growth of this multi-billion industry, which is further expected to fuel the aroma chemicals demand.00

Regional Insights

Asia Pacific dominated with a revenue share of 30.80% in 2021. This is attributed to the increased demand for fragrances and flavors in developing countries such as India. Asian flavors and fragrances have gained high popularity in major regions such as North America and Europe. Pakistan, China, Taiwan, the Philippines, and South Korea have emerged as prominent fragrance markets, whereas China, India, Australia, and Southeast Asian countries including Indonesia, Vietnam, and Malaysia are among the prominent food flavor markets in the region.

In terms of revenue, the U.S. holds a significant share in the North America aroma chemicals industry, which is expected to grow over the forecast period owing to the rising demand for aroma chemicals from the cosmetics & personal care industry. Low-fat food & beverage products require additional flavors to augment the taste of the final product. The high prevalence of obesity in the U.S. and growing demand for low-calorie food are likely to boost the demand for a variety of flavors, which is anticipated to drive the demand for aroma chemicals.

Germany emerged as the largest key contributor to the European aroma chemicals market and is anticipated to dominate the region over the forecast period due to the wide utilization of aroma chemicals in personal care & cosmetic products. Owing to the popularity of social media, local players operating in the cosmetics market have the means to reach a global audience.

Some cosmetic brands including BELLAMI Hair, Revlon, and others became popular on social media and have been acquired by established market players in Europe. In addition, key players in Germany are creating exotic flavors owing to the strong demand for dairy and meat products and the growing importance of ready-to-eat meals, which is expected to trigger the demand for aroma chemicals.

Key Companies & Market Share Insights

The market is oligopolistic, with the top four players accounting for more than 45% of the market share. This segmentation of players is based on their aroma chemicals product diversity, market penetration, and their revenue collection from business operations. Givaudan; International Flavors & Fragrances Inc.; Symrise; and Firmenich SA are some of the industry leaders.

In 2019, Givaudan generated overall revenue of around USD 6,852.629 million. Similarly, International Flavors & Fragrances Inc. generated annual sales of around USD 5,140.08 million in 2019. These companies offer a broad product portfolio of aroma chemicals across the globe, are highly integrated across the value chain, and hence, are the market leaders. Some prominent players in the global aroma chemicals market include:

• BASF SE

• Privi Organics India Limited

• Takasago International Corporation

• Kao Corporation

• Bell Flowers & Fragrances

• Givaudan

• S H Kelkar and Company

• Symrise

Aroma Chemicals Market Report Scope

Global Aroma Chemical Market Segmentation

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2018 to 2030. For this study, Grand View Research has segmented the global aroma chemicals market report based on source, chemical, application, and region:

• Source Outlook (Volume, Kilotons; Revenue, USD Million, 2018 - 2030)

  • Natural

  • Synthetic

  • Natural-identical

• Chemicals Outlook (Volume, Kilotons; Revenue, USD Million, 2018 - 2030)

  • Benzenoids

  • Musk Chemicals

  • Terpenes & Terpenoids

  • Others (Ketones, Esters, Aldehydes)

• Application Outlook (Volume, Kilotons; Revenue, USD Million, 2018 - 2030)

  • Flavors

    • Confectionery

    • Convenience Food

    • Bakery Food

    • Dairy Products

    • Beverages

    • Others

  • Fragrance

    • Fine Fragrance

    • Cosmetics and Toiletries

    • Soaps and Detergents

    • Others

• Regional Outlook (Volume, Kilotons; Revenue, USD Million, 2018 - 2030)

  • North America

    • U.S.

    • Canada

    • Mexico

  • Europe

    • Germany

    • U.K.

    • France

    • Italy

    • Spain

  • Asia Pacific

    • China

    • India

    • Japan

    • South Korea

  • Central & South America

    • Brazil

    • Argentina

  • Middle East & Africa

    • Saudi Arabia

    • South Africa