Aroma Chemicals Market

Aroma Chemicals Market Growth Outlook (2022-2032)

The aroma chemicals market reached a valuation of US$ 5.11 Billion by 2021, and is likely to register a Y-o-Y growth rate of 1.0% in 2022, closing at US$ 5.21 Billion. Furthermore, across the 2022-2032 period of assessment, growth is expected to accelerate at a whopping 4.7% CAGR, reaching US$ 8.11 Billion.

Increased use of flavors and fragrances in the soaps, detergents, cosmetics, as well as food and beverage industries is credited with driving the expansion of the global aroma chemicals market.

Due to the expanding application potential in important end-use industries like cosmetics and personal care products, dairy, soaps and detergents, processed food, fine fragrances, bakery foods, as well as confectionery, the demand for aroma chemicals is rising. The main factors propelling the industry's growth include rising demand for beverages with fewer calories and expansion of the beverage market.

Since flavors play a significant role in how edible products taste and smell, the aroma chemicals are used to enhance the flavor of beverages along with processed foods. The rise of natural aroma chemicals is being fueled by the rising demand for healthy and wellness foods, ban on the usage of some synthetic flavors.

The main factors influencing market growth are the appropriateness of natural flavors in a wider range of applications, increased health advantages of specific natural flavors, and cutting-edge technological innovation.

Report Attributes	Details
Market Size in 2021	US$ 5.11 Billion
Market Value in 2022	US$ 5.21 Billion
Projected Forecast Value (2032)	US$ 8.11 Billion
Global Growth Rate (2022-2032)	4.7% CAGR
Expected Growth Rate of the Asia Pacific (2022-2032)	6.1% CAGR
Anticipated Growth Rate of North America (2022-2032)	5.6% CAGR
Key Companies Analysis	Kelkar Group BASF SE Hindustan Mint and Agro Products Solvay Symrise AG Robertet Kao Corporation, Privi Organics Ltd. Kalpa Sutra Chemicals, Bell Flavors & Fragrances

2017-2021 Revenue Analysis of Aroma Chemicals Market vs. Growth Outlook 2022-2032

According to Fact.MR’s report,Aroma Chemicals demand exhibited a CAGR of over 5.1% from 2017 to 2021.

Compositions for fragrances have been made using about 3000 different kinds of molecules. The aroma chemicals are employed in a wide range of products, the most popular of which are cosmetics, fine fragrance and toiletries.

They also have been employed historically as odorizers to give dangerous, odorless substances like propane, natural gas, and others a pleasant scent.

Increasing consumer expenditure and growing preference from the fragrance as well as food and beverage industries will both contribute to an increase in the market's overall size over the projected time frame (2022-2032).

Key Market Drivers Influencing Aroma Chemicals Industry Expansion

Global Expansion of Cosmetics Industry to Fuel the Market Growth

The growing demand for personal care products items like facemasks, creams, peels, and others as a result of their widespread use by both men as well as women will accelerate the growth of the cosmetics industry. The change toward organic and natural cosmetics has opened up new opportunities due to changes in lifestyle choices and an increase in per-capita disposable cash. Consumers ’ interest in various high-end and novel cosmetic products has risen as a result of rapid urbanization and booming e-commerce.

Cosmetics and toiletries like aftershaves, gels, lipsticks, foundations, moisturizers, body and hand washes, soaps, body lotions, shampoos, and other items frequently contain aroma chemicals. These substances are used to create natural scents in these product lines without degrading their quality or formulation. Significant cosmetic producers are launching innovative products with natural ingredients because cosmetics have become an essential part of people's lives. This is boosting their sales worldwide and fueling the market's expansion.

Technological Advancements in the Manufacturing Process to Propel Market Growth Prospects

Rapid development in the chemical industry, coupled with the availability of raw materials, is increasing the demand for technological advancements in sectors such as food and beverage, cosmetics, and personal care. Thus, the increasing development in technologies used in the chemicals industry is boosting the manufacturing capabilities of aroma chemicals. Thus, the advancement in technology is creating an opportunity to grow the global aroma chemicals market.

Additionally, businesses are creating and implementing more environmentally friendly and cleaner extracting technologies. For example, Privi Speciality Chemicals Limited uses waste recycling and emission reduction as part of its production processes. In order to reduce waste and increase profits, the firm utilizes high-value chemicals of fragrance from Crude Sulphate Turpentine (CST) and agrochemicals from the by-products.

Key Challenges encountered by Aroma Chemicals Industry

High Cost Associated with Research & Development to Hinder the Market Growth

The main factors which are predicted to hinder the growth of the Aroma Chemicals Market in the forecast period include high research and development costs and strict restrictions placed on production for aroma chemicals.

Usage of Synthetic Chemicals in Perfumes to Hamper the Market Growth

Nearly all of the synthetic chemicals used in fragrances, including aldehydes, phthalates, benzene derivatives, and others that are toxic and hazardous to human health, are made from petroleum. These substances harm both adults and child's nervous systems and can lead to allergies, asthma, and congenital abnormalities. On the EPA's list of hazardous materials, a number of these synthetic chemicals are listed as being dangerous.

Researchers from the Environmental Working Group (EWG) estimate that phthalates, which have been linked to diabetes, breast cancer, reproductive malformations, a decline in sperm count, and disrupted hormonal activities, are present in about 75% of fragrance products. These elements might prevent the market from expanding overall.

Region-wise Analysis

How will Asia Pacific Perform in the Global Aroma Chemicals Industry Landscape?

Expansion of Personal Care Industry to Boost the Market Growth in APAC

The Asia Pacific Aroma Chemicals market is expected to expand at a CAGR of 6.1% across the forecast period. This is due to China's expanding personal care industry. The rising demand for fragrances in China, Japan, and India, as well as the growing importance of organic and natural fragrances, are expected to propel regional market growth. Another factor contributing to market growth is the high spending power of consumers in these countries.

Companies are concentrating their efforts on R&D and business expansion in the Asia Pacific region. For instance, in September 2019, Firmenich, a flavor, ingredient, and fragrance manufacturer, opened an innovative Fine Fragrance Atelier in China. Customers in China and around the world have easy access to all of the fine fragrance products offered by the company.

How will the Growth of Aroma Chemicals Market Escalate across North America?

Rising Consumer Awareness About Maintaining Healthy Environment to Enhance the Market Prospects

The North American aroma chemicals market will grow at a CAGR of 5.6% from 2022 to 2032. Rising consumer awareness about the importance of maintaining a healthy and sanitary environment in their surroundings is expected to drive demand for toiletries products such as soaps, detergent, sanitizers, disinfectant floor cleaners, and toilet cleaners, among others, which will drive demand for aroma chemicals over the forecast year.

Attributed to the growth in the personal care and cosmetics industries, the United States held the largest share of the North American market in 2020. A rise in per-capita disposable income is likely to fuel the expansion of the personal care, cosmetics, and food and beverage industries, while growing health-conscious consumers will strengthen the region's market position.

Region-wise Forecast CAGRs for the Aroma Chemicals Market

Region	CAGR
Asia Pacific	6.1%
North America	5.6%
Europe	5.4%
Latin America	4.4%
Middle East & Africa	4.0%

Category-wise Insights

Which Segment to Remain Dominant in the Source Category?

Synthetic Aroma Chemicals Segment to Enhance Growth Prospects

Data from Fact.MR show that demand for Synthetic Aroma Chemicals is predicted to grow at a CAGR of 4.6% during the forecast period.

By accounting for 69% of overall revenue in 2022, the synthetic source segment is anticipated to dominate the market for aroma chemicals. The synthetic market segment is anticipated to rule in the upcoming years. Manufacturers in the food and beverage, personal care, as well as cosmetics sectors rely heavily on synthetic aromas. In the food business, they can make carbonated drinks, candies, and snacks that smell like natural foods.

Without considering the qualities of all the other chemicals used in fragrance formulations, many fragrance manufacturers rely on synthetic chemicals to produce a potent aroma. The use of natural scents in cosmetics is growing in popularity. Producing cosmetics with natural ingredients is not practical due to the possibility of allergies as well as skin sensitivities, forcing manufacturers to create goods with synthetic chemicals instead.

Which is the Most Sought-after Type Category?

Increased Demand for Flavorings and Fragrances to Boost the Segment’s Growth

According to Fact.MR’s data, preference for Terpenes/Terpenoids is expected to expand at a CAGR of 4.5% over the forecast period.

In the market for aroma chemicals in 2020, terpenoids will represent the most significant chemical category. They possess therapeutic qualities like anti-microbial, anti-carcinogen, and antiseptic qualities. Terpenes are used in a wide range of flavorings and fragrances because of their pleasant aroma. Antimalarial medications like artemisinin use terpenoids as well as their derivatives, that have antimicrobial, antiseptic medicinal and anti-carcinogenic properties.

Growing terpene demand in the cosmetics, pharmaceutical, food, as well as other industries will support the segment's growth. Both synthetic and natural sources of musk chemicals are available. They can be found in a wide range of goods, including food, household items, detergents, soaps, and personal care and cosmetics.

A rise in the demand for skincare products as well as a rise in the number of working adults has contributed to the growth of musk chemical compounds. In the upcoming years, the market for musk chemicals will expand due to the rising popularity of various cosmetic products and high-end fragrances.

Aroma Chemicals Market- Competitive Landscape

Prominent players in the Aroma Chemicals Industry are taking advantage of the rapidly increasing demand for the Aroma Chemicals in various applications. To further their outreach, players are relying on collaborations, partnerships and acquisitions with existing small, medium and large-scale vendors. Some prominent market developments are as follows:

• In December 2021, Firmenich SA announced the commissioning of a new production unit for renewable ingredients at its facility located in Castets, France. The new production plant was expected to be operational from January 2022.
• In June 2020, Givaudan launched VivaScentz™, a leading-edge fragrance innovation to enhance consumer well-being with offering benefits across all categories of perfume including fine fragrance, personal, home, and fabric care as well as oral care flavours. This new technology, at the forefront of the fragrance industry, aims to help consumers achieve a holistic sense of wellbeing.
• In June 2020, BASF acquired Isobionics, a biotech company, to setup its own distillation plant for the manufacture of new flavors & fragrances. The plant is supposed to be built at Brightlands Chemelot Campus in Geleen in the Dutch Province of Limburg. This strategy is to set up its own production unit for manufacturing and development of new fragrances which is anticipated to create opportunities for market growth.

Key Segments Covered in the Industry Survey

• B Application:

  • Soaps & Detergents
  • Cosmetics & Toiletries
  • Food & Beverages Ingredients

• By Compound:

  • Alcohol-based 
    • Saturated Alkyl-Alcohol
    • Unsaturated Alkyl-Alcohol
    • Complex Fragrance Alcohol
    • Aromatic and Aralkyl Alcohol
    • Phenolic
  • Acids-based 
    • Saturated Aliphatic Acid
    • Unsaturated Aliphatic Acid
    • Aromatic Acid
  • Esters-based 
    • Saturated Esters
    • Unsaturated Esters
    • Aromatic Esters
    • Lactones- Gamma and Delta
    • Synthesis of Ester
  • Aldehydes–based Aroma Chemicals
    • Aliphatic Aldehyde
    • Unsaturated Aldehyde
    • Acetals
    • Aromatics
    • Nitriles
  • Ketones-based 
  • Hydrocarbons-based 

• By Source:

  • Natural Aroma Chemicals
  • Synthetic Aroma Chemicals

• By Type:

  • Benzenoids-based 
  • Musk
  • Terpenoids-based 

• By Region:

  • North America
  • Latin America
  • Europe
  • East Asia
  • South Asia
  • Oceania
  • Middle East & Africa