Perfume Ingredient Chemicals Market - Forecast(2023 - 2028)

Perfume Ingredient Chemicals Market Overview

The perfume ingredient chemicals market size is forecast to reach US$9.1 million by 2027 after growing at a CAGR of 5.6% during 2022-2027. Perfume ingredient chemicals refer to the building blocks prepared with a wide variety of synthetic and natural substances extracted from plants, fruits, and trees. These chemical ingredients are used to impart scent to distinct products in multiple industries. Sometimes, these chemical ingredients are also utilized to mask the unpleasant smell of other ingredients, without giving products any noticeable scent. Ethyl alcohol, methylene chloride, benzyl acetate, indole, linalool, geranium, and camphor are some of the commonly utilized chemical ingredients in the fragrance formulation. Perfume chemical ingredients find their extensive use in the personal care application where these chemical ingredients are utilized for creating distinctive fragrances for use in products such as shampoos, shower gels, shaving creams, and moisturizers. The demand for personal care products is increasing globally and this is expected to drive the market’s growth during the forecast period. For instance, as per the stats by Cosmetics Europe, the European personal care and cosmetics market accounted for USD 88.91 billion at retail price, making it the world’s largest market in 2020. Furthermore, the manufacturers in the market are focusing on the higher development of natural-based chemical ingredients owing to increasing awareness among consumers regarding sustainable products and this is projected to further expand the growth of the market during the forecast period. For instance, in April 2021, French fragrance manufacturer MANE launched its new specialty ingredient FLORAPEEL which reveals a pleasant pink grapefruit scent. Essential oils will witness the highest demand during the forecast period. The strict regulations regarding the use of perfume ingredient chemicals might hamper the market’s growth during the forecast period.

COVID-19 Impact

The perfume ingredient chemicals market had a negative growth due to the COVID-19 pandemic. The market faced challenges in the form of supply chain disruption, raw material procurement, and temporary factory shutdown. Market players incorporated numerous measures to withstand the unprecedented circumstances amid the pandemic and maintain a standard business operation. However, the manufacturers incurred losses and faced challenges even after implementing contingency plans. As per the 2020 results report by Shiseido Company, the company faced extreme challenges in its business environment due to the COVID-19 outbreak. The market witnessed growth towards the last quarter of 2020. Going forward, the market is expected to experience significant growth due to increasing product development and rising end-use applications.

Report Coverage

The report: “Perfume Ingredient Chemicals Market Report - Forecast (2022-2027)”, by IndustryARC, covers an in-depth analysis of the following segments of the Perfume Ingredient Chemicals Industry. 

By Type: Synthetic Aroma Chemicals (Ethyl Alcohol, Benzyl Acetate, Aldehyde, Methylene Chloride, Others), Essential Oils (Lemon, Eucalyptus, Peppermint, Geranium, Rosewood, Jasmine, Others), Others
By Application: Personal Care (Shampoos, Shower Gels, Shaving Creams, Body Lotions, Aftershave, Moisturizers, Facial Serums, Others), Home Care (Laundry Detergents, Fabric Softeners, Dryer Sheets, Room Fresheners, Carpet Fresheners, Scented Candles, Others), Fine Fragrances, Others
By Geography: North America (USA, Canada, Mexico), Europe (UK, Germany, France, Italy, Netherlands, Spain, Russia, Belgium, Rest of Europe), Asia Pacific (China, Japan, India, South Korea, Australia, and New Zealand, Indonesia, Taiwan, Malaysia, Rest of Asia Pacific), South America (Brazil, Argentina, Colombia and Rest of South America), and RoW (Middle East and Africa).

Key Takeaways:

• Essential oils dominated the perfume ingredient chemicals market in 2021. These are natural compounds extracted from plants, making them a suitable choice in the market.
• The increasing development of natural ingredients is projected to drive the market’s growth. For instance, in March 2020, Givaudan launched its new ingredient solution Synchronight, made from gardenia fruit extract for skin care products.
• The Asia-Pacific region is expected to witness the highest demand for perfume ingredient chemicals owing to the expanding demand for personal care products in the region. For instance, according to data by the Ministry of Economy, Trade, and Industry (METI), the personal care and cosmetics market in Japan became the world’s third-largest market in 2019 with a market value of USD 35 billion.

Figure: Asia Pacific Perfume Ingredient Chemicals Market Revenue, 2021-2027 (US$ Billion)

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Perfume Ingredient Chemicals Market Segment Analysis - By Type

The essential oils segment dominated the perfume ingredient chemicals market in 2021 and is growing at a CAGR of 7.1% during the forecast period. Essential oils are natural compounds extracted from various plants and fruits. A wide variety of essential oil such as eucalyptus, peppermint, rosewood, and geranium are used in the formulation of perfumes and several other products. The demand for nature-based ingredients and sustainable products is increasing among consumers. Accordingly, market players are focusing on the expansion of the essential oils portfolio in the market. For instance, in May 2019, Givaudan acquired Albert Vieille, a French based company that deals with essential oils and specialty natural ingredients. This acquisition allowed Givaudan to expand its essential oil portfolio. Such movements by market players will help in furthering the demand for essential oils during the forecast period.

Perfume Ingredient Chemicals Market Segment Analysis - By Application

Personal care application dominated the perfume ingredient chemicals market in 2021 and is growing at a CAGR of 7.6% during the forecast period. Perfume chemical ingredients composed of various synthetic and natural substances such as essential oils are utilized in the production of a wide range of personal care products. The demand for personal care products is on the rise globally and this is expected to drive the growth of the market during the forecast period. For instance, as per the data by the Cosmetics, Toiletry and Perfumery Association, the European cosmetics market accounted for USD 92.58, making it the largest cosmetics market in 2019. Similarly, according to the April 2019 stats by the India Brand Equity Foundation, skincare segment in India is expected to expand at an annual average growth rate of 10.4% through 2022. Such growing demand for personal care products globally is expected to stimulate the higher consumption of perfume ingredient chemicals which will contribute to the market’s growth during the forecast period.

Perfume Ingredient Chemicals Market Segment Analysis - By Geography

The Asia-Pacific region held the largest market share in the perfume ingredient chemicals market in 2021, up to 32%. The high demand for perfume ingredient chemicals is attributed to the increasing demand for personal care products in the region. Perfume chemical ingredients are used in the formulation of several personal care products such as facial serums, moisturizers, shampoos, shower gels, and shaving creams. The region is witnessing exceptional demand for personal care products and this is anticipated to increase the demand for perfume ingredient chemicals during the forecast period. For instance, as per stats by India Brand Equity Foundation, India’s cosmetic and personal care sector will become a USD 15.17 billion market by 2024 which was USD 9.98 billion in 2019. Similarly, as per the report by International Trade Administration, Japanese cosmetics brands adopted direct to consumer (D2C) model in 2020 amid the pandemic and got considerable sales growth owing to high demand for cosmetic products. Such increasing growth in the region’s personal care products is projected to bolster the demand for perfume ingredient chemicals during the forecast period.

Perfume Ingredient Chemicals Market – Drivers

Increasing development of natural based chemical ingredients will drive the market’s growth

The market is witnessing higher development of natural-based chemical ingredients to Cater to this increasing demand for natural ingredients and fragrances among consumers. Consumers pay more attention to fragrances and their sustainability factor, especially in personal care and home care products. Accordingly, market players are focusing on developing more natural-based ingredient chemicals. For instance, in July 2020, MANE launched its advanced specialty ingredient solution GREENCATCHER which exhibits powerful fruity herbal note. This product can be utilized in several personal care and fine fragrance applications. Similarly, in March 2019, Switzerland-based fragrance and active ingredient manufacturer Givaudan launched its new active ingredient Sensityl for cosmetics. Such development of natural ingredient solutions expected to increase the demand for perfume ingredient chemicals, ultimately driving the growth of the market during the forecast period.

Expanding personal care applications will drive the market’s growth

Perfume ingredient chemicals involving synthetic aroma chemicals and essential oils are extensively utilized in the formulation of several personal products such as aftershaves, shampoos, shaving creams, moisturizers, and facial serums. The demand for personal care products is expanding globally and this is expected to drive the market’s growth during the forecast period. For instance, according to the September 2021 stats by Invest India, Reliance Retail will soon start the selling of cosmetic products through online mode due to the increasing demand for cosmetics in the Indian market. Similarly, as per the report by the Cosmetics, Toiletry and Perfumery Association (CTPA), the European region accounted for the largest cosmetics market globally in 2020 with Germany (USD 16.18 billion) dominating the region followed by France (USD 13.29 billion). Such massive expansion in the personal care application is projected to augment the higher uses of perfume ingredient chemicals which in turn is anticipated to drive the market’s growth during the forecast period.

Perfume Ingredient Chemicals Market – Challenges

The strict regulations regarding the use of perfume ingredient chemicals might hamper the market’s growth

The market is strictly tracked by several governing bodies owing to the harmful effects of multiple ingredient chemicals, posing a severe challenge and this might affect the market’s growth during the forecast period. Ingredient chemicals such as Acetaldehyde, Benzophenone, and a few others are strictly monitored by regulatory authorities as these substances are associated with various health issues. As per the data by safecosmetics.org, acetaldehyde is found to adversely affect kidneys, respiratory and nervous systems. The United States Food and Drug Administration also closely monitors the use of perfume ingredient chemicals used in multiple products. Such strict regulations and monitoring might affect the market’s growth during the forecast period.

Perfume Ingredient Chemicals Market Industry Outlook

Investment in R&D activities, acquisitions, product and technology launches are key strategies adopted by players in the perfume ingredient chemicals market. Global Perfume Ingredient Chemicals top 10 companies include are:

Recent Developments

• In December 2021, Givaudan announced the acquisition of US-based fragrance creation house, Custom Essence. This acquisition enabled Givaudan to expand its natural perfumery capabilities.
• In October 2021, L’Oréal Groupe launched its fragrance disclosure model. This model launch allowed the company to provide detailed ingredient information to its customers.
• In July 2021, Symrise announced the development of its new special fragrance raw material, Lilybelle. This product launch allows perfumers to develop scents for laundry care products, personal care products, and cleaning products.

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