India Extracts Market Assessment, By Type [Plant Extracts (Flavonoids, Essential Oils, Oleoresins, Natural Color, Alkaloids, Carotenoids, Others), Synthetic Extracts (Synthetic Essence, Synthetic Dyes and Pigments, Synthetic Flavor, Synthetic Colorants, Others)], By Form [Solid or Dry, Liquid], By End-user [Pharmaceuticals & Nutraceuticals, Animal Feed, Food and Beverage, Personal Care and Cosmetics, Others], By Region, Opportunities, and Forecast, FY2017-2031F
The India Extract market size was estimated at USD 2.79 billion in FY2023 and is projected to reach USD 5.5 billion in FY2031, growing at a CAGR of 8.87% from FY2024 to FY2031. The market is being driven by factors such as increasing consumer awareness, changing lifestyle, increasing consumption of products made from natural ingredients, and developments taking place in biotechnology sector.
The demand for natural extracts has also increased over the past few years as a result of macroeconomic variables such as increasing income of consumers, R&D, imports & exports, expansion of the agriculture sector, increasing number of geriatric consumers, and population growth. Natural extracts are becoming popular across different industries such as F&B, cosmetics, perfumes, medicines, and nutraceuticals.
With extracts being on a front seat, processed food manufacturers are continuously launching new products and expanding to new geographies. In December 2022, Sober and Co, an India based cocktail mixer manufacturer from West Bengal launched their products in Bengaluru. Also, The Ordinary, a Canada based beauty and cosmetics company entered India in June 2022, and started providing skincare treatment products and serum. The expansion is based on the company long-term strategic plan of expansion in various geographies.
Increasing Demand for Herbal Extracts-Based Healthcare Products
Numerous health disorders and medical conditions are now more common than ever before due to increasing geriatric population and widespread pollution. Due to the growing number of ailments such as cancer, digestive disorders, obesity, diabetes, premature hair ageing, hair loss, and skin issues, there is a greater demand for effective and safe therapy. Herbal extracts are rich in carotenoids and polyphenols; hence they are effective in treating aforementioned conditions.
Indian companies are trying to utilize India’s rich traditional herbal extracts knowledge to create & launch new products in the country. In September 2022, Diabliss Consumer Products Pvt Ltd, an India based food and herbal water supplements provider, announced 10 new herbal water products to be launched by December 2023 in the country; all the 10 products are getting designed to combat cholesterol, diabetes and other health related issues.
Increasing Demand for Neem Based Extract for Bio-Based Pesticides and Fertilizers
The market for organic pesticides and fertilizers has significantly grown as a result of growing public awareness pertaining to usage of neem extracts in pesticides and fertilizers. Neem is a key component in majority of bio-based goods; hence the demand for neem extract is also increasing. Neem extract is also used in plant-based foods for animals.
Consumers are becoming more aware about the benefits of natural components and extracts. Governments and many organizations around the globe have started prioritizing R&D in this segment. India has a natural abundance of therapeutic and medicinal plants and is actively encouraging production of herbal-based products. Government of India initiated Ministry of AYUSH in 2014, to assist market-driven production of selective medicinal plants in specified clusters/zones.
Impact of COVID-19 on India Extracts Market
India is a major producer and exporter of extracts, including spices, herbs, and essential oils, but the pandemic has disrupted supply chains and led to a decline in demand from both domestic and international markets. The nationwide lockdowns and restrictions on travel and trade have led to logistical challenges and supply chain disruptions, affecting the sourcing and distribution of raw materials and finished products. The closure of hotels, restaurants, and food service industries has also significantly impacted demand for extracts, particularly in the hospitality sector. Moreover, the shift towards online shopping and e-commerce platforms has been a boon for some players in the extracts market, allowing them to reach consumers directly and bypass traditional distribution channels.
Key Player Landscape and Outlook
The market will witness growth in the near future as major market participants spend a significant amount of money on R&D to diversify their product lines. Market participants are engaging in a variety of strategic initiatives to strengthen their product portfolio. In March 2023, Nutricircle Limited launched a new plant protein isolate range including rajma, moong, jowar, quinoa, bajra, amaranth, etc. The company had spent thousands of dollars in R&D to establish these products and showcased/launched them at AAHAR 2023 event held in New Delhi, India.
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