June 18, 2024
Herbal Extract Market

Herbal Extract Market Poised to Witness Robust Growth Due to Increasing Demand for Natural Ingredients

The herbal extract market has seen significant growth in recent years owing to the rising preference for natural and herbal ingredients across various industries such as pharmaceuticals, food and beverages, cosmetics and personal care. Herbal extracts are concentrated compounds extracted from plants that have several health benefits. They provide various therapeutic properties such as anti-inflammatory, antioxidant and anti-microbial effects. The growing awareness among consumers regarding the medicinal properties of herbal extracts has increased their applications in various herbal medicines, supplementation and functional foods and beverages. The Global herbal extract market is estimated to be valued at US$ 41.8 billion in 2024 and is expected to exhibit a CAGR of 7.0% over the forecast period from 2024 to 2031.

Key Takeaways

Key players operating in the herbal extract market are Botanic Healthcare, VIDYA HERBS Pvt. Ltd, Allicin Pharm, HerbalHills, Acara bioherb PVt. LTD., Pioneer Enterprises (I) Private Limited, Sydler India Pvt. Ltd, Herbal Creations, Alpspure Lifesciences Private Limited, IDOBIO CO., LTD., Döhler GMB, MartinBauer. The key players are focusing on new product launches, mergers and acquisitions to expand their product portfolio and global presence.

The key opportunities in the Herbal Extract Market Demand  include increasing research and development activities to develop new herbal extracts for various applications and untapped markets in developing regions. With the growing popularity of herbal medicines and supplements, there is significant scope for market expansion.

Technological advancement such as improved extraction technologies allowing for higher yields, concentration and purity of extracts is expected to drive the herbal extract market. Supercritical fluid extraction (SFE) and ultrasound-assisted extraction (UAE) methods have gained popularity as cleaner and more sustainable techniques for herbal extraction.

Market Drivers

The major driver for the herbal extract market is the increasing demand for natural and herbal ingredients in food and beverages, nutraceuticals, cosmetics and other personal care products. The huge popularity of traditional herbal medicines and Ayurveda is also driving the consumption of herbal extracts globally. Growing health awareness among consumers and their inclination towards preventive healthcare is propelling the demand for herbal supplements with specific therapeutic benefits. Stringent regulations regarding the use of synthetic ingredients will further encourage the adoption of herbal extracts in various industries.

Current Challenges in Herbal Extract Market

The herbal extract market is facing several challenges currently including fluctuating raw material costs, shortage of skilled workforce, supply chain disruptions caused by pandemic, regulatory compliance and quality consistency. Raw material costs for herbs are highly dependent on weather conditions and may see price fluctuations depending on climatic changes which impacts margins for manufacturers. Finding skilled professionals with expertise in plant identification, processing and standardization of herbal extracts is also difficult. The pandemic severely disrupted supply chains last year as transportation got halted affecting supplies. Maintaining complete regulatory compliance and quality consistency over a wide product range remains an ongoing challenge.

SWOT Analysis

Strengths: Growing consumer preference for natural ingredients, wide application in food & beverages, pharmaceuticals and personal care industries.
Weaknesses: Complex extraction and standardization processes, quality issues due to adulteration, compliance overheads.
Opportunities: Untapped rural markets in developing regions, innovation in delivery formats, projections of double digit industry growth.
Threats: Supply risks due to climate change and monsoon failures, stringent regulations in developed markets.

Geographical Regions

The North American region currently accounts for the major share in the global herbal extract market in terms of value owing to increasing health consciousness and natural products adoption. China also has a high market concentration due to its rich biodiversity, established manufacturing base and large population relying on traditional medicines.

Fastest Growing Regions

The Asia Pacific region excluding China and Japan is projected to witness the fastest growth during the forecast period mainly driven by rising disposable incomes, expanding middle class population and burgeoning healthcare expenditure in emerging economies like India. Growing export opportunities from Southeast Asian countries to developed markets will further support the market development.

*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it.