In 2014 the global market for fragrance ingredients was estimated at $13.08bn, and is forecast to grow at an annual rate of 5.6% over the next four years to 2019 to reach $17.10bn, according to market research provider Research and Markets.
The report, titled Fragrance Ingredients – Global Trends & Forecasts to 2019, highlights how the evolotion of this category is being driven by the continued growth of the personal care, cosmetics and fragrance categories as a whole.
Trend for natural fragrances drives growth
The main reason for this is a continued increase in spending power of the average consumer worldwide, a phenomenon that is particularly underlined in fast growing emerging economies such as Russia, China and India, as well as more recent growth spurts in emerging markets such as Indonesia, the Philippines and Mexico.
However, one particular trend that is influencing the type of fragrance ingredients that manufacturers are requiring is consumer demand for products that provide a sense of enhanced wellbeing.
For all types of fragrances and fragranced products, this means that manufacturers are looking for natural-based or naturally derived fragrances, avoiding synthetic-based ingredients which have a perceived heightened risk of allergies and toxins.
Europe still the biggest market, but watch out for LatAm
The most up to date figures from the report show that Europe continues to be the most important geographical area for fragrance ingredients demand, commanding approximately 30% of the total value.
However, the fact that the Latin American region has the highest per capita fragrance consumption, combined with the fact that it continues to post higher rates of economic growth and increased consumer spending power, this region is predicted to post the highest category gains over the course of the next four years.
Cosmetics & toiletries will drive highest category demand
The report highlights that the mainstay category for fragrance ingredient demand through to 2019 will continue to come from soaps and detergents.
However, the highest growth rate for fragrance ingredients will be seen in the category for cosmetics & toiletries, which is predicted to grow at a CAGR of 6% in the period up to 2019.