The herbal extract market has witnessed significant growth over the past few years owing to high demand for nutritional and herbal supplements among consumers. Herbal extracts are generally used as natural ingredients in the pharmaceutical, food & beverages, and cosmetic industries. Herbal extracts offer various health benefits such as immune system support, reduced inflammation, blood sugar control, and antiviral properties. The rising awareness about preventive healthcare has boosted the adoption of natural and herbal ingredients.
The Global herbal extract market is estimated to be valued at US$ 41.8 BN in 2024 and is expected to exhibit a CAGR of 7.0% over the forecast period 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, and MartinBauer. The key players are focusing on new product launches, mergers, acquisitions, and collaborations to gain a competitive edge in the market.
The growing trend of clean label products and rising disposable income are creating lucrative opportunities for Herbal Extract Market Demand manufacturers. Consumers are increasingly spending on healthy, natural, and herbal ingredients. The growth of end-use industries such as food & beverages and nutraceuticals is also fueling the demand for herbal extracts.
Key players are expanding globally to tap the opportunities in developing markets. The Asia Pacific and South American regions are emerging as highly promising markets owing to the increasing health-conscious population. Growing exports from countries such as China, India, Brazil are positively impacting the global herbal extract industry.
Market drivers and restrain
The key driver for the herbal extract market is the rising demand for natural ingredients from the food & beverage industry. Consumers are increasingly preferring clean label and natural food products with no preservatives or artificial additives. This is driving the adoption of herbal extracts in various food applications such as beverages, snacks, bakery products etc.
However, volatile raw material prices pose a major challenge for herbal extract manufacturers. The prices of raw herbs depend on climatic conditions, production yields and global demand-supply forces. Any shortage or high demand can significantly increase the prices of raw materials, negatively impacting the profit margins of companies. Also, the lack of standardization in production practices and differences in regional regulations further restrain the growth of the herbal extract market.
Segment Analysis
The herbal extract market can be segmented based on source as mint, holy basil, aloe vera, grape seed, coffee, turmeric, ginseng, ginkgo biloba and other herbs. The mint segment dominated the market in 2024 due to widescale consumption of mint flavored products across the industries of healthcare, cosmetics, food and beverages. The mint segment accounted for over 30% of the total market share owing to high demand for mint extract in oral care, confectionery, juices and other food and beverage products to impart freshness to their taste profiles.
Global Analysis
The Asia Pacific region is expected to be the fastest growing as well as the dominating region in the global herbal extract market during the forecast period. This is attributed to high preference for herbal ingredients in cosmetics and pharmaceutical industries in countries like India, China and Indonesia, where traditional medicine relies heavily on herbal formulations and remedies. Indonesia, China, South Korea and India specifically have been leveraging the cost effectiveness of herbal extracts in pharmaceuticals for a long time and it is now gaining traction in other applications as well like personal care and food and beverages. Countries in South and Southeast Asia with strong herbal medicine heritage like Ayurveda and traditional Chinese medicine rely extensively on herbal extracts for their primary healthcare needs further driving the Asia Pacific herbal extract market.
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