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Natural Spice Extracts Market Size, Share, Industry, Forecast and Outlook (2024-2031)

Published: May 2024 || SKU: FB8415
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180 pages
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Table of Contents
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Global Natural Spice Extracts Market  is segmented By Source (Cassia, Bay leaf, Caraway, Anise, Others) By Form (Liquid, Powder) By Distribution Channel (Supermarkets and Hypermarkets, Convenience Stores, Online Stores, Others) By Application (Food and Beverages, Personal Care and Cosmetics, Pharmaceuticals, Nutraceuticals, Others) and By Region (North America, Europe, South America, Asia Pacific, Middle East, and Africa) – Share, Size, Outlook, and Opportunity Analysis, 2024-2031

Market Overview

Global Natural Spice Extracts Market reached US$ 2.56 billion in 2023 and is expected to reach US$ 5.75 billion by 2031, growing with a CAGR of 10.65% during the forecast period 2024-2031.

The natural and organic food industry is experiencing rapid growth as consumers prioritize healthier and more sustainable food choices. Natural spice extracts are integral to this industry, providing flavor and functionality to organic products. Market players are capitalizing on this trend by offering a diverse range of natural spice extracts certified as organic, tapping into the expanding market for organic food products.

Consumers in the Asia-Pacific region have a strong preference for traditional and authentic flavors in their food and beverages. Natural spice extracts, derived from locally grown herbs and spices, are used to create these desired flavor profiles. Market players are responding by offering a wide range of natural spice extracts that cater to the diverse culinary traditions of the region, driving market growth.

For instance, MANE KANCOR launched its largest production facility in India on May 20th, 2023, situated in Byadgi, Karnataka. Spanning 50 acres, this state-of-the-art facility is poised to create numerous job opportunities, benefiting both direct employees and farmers in the region. The opening ceremony was graced by the presence of key figures including the President of MANE Group and the Executive Director and CEO of MANE KANCOR.

Market Scope

Metrics

Details

CAGR

10.65%

Size Available for Years

2022-2031

Forecast Period

2024-2031

Data Availability

Value (US$)

Segments Covered

Source, Form, Distribution Channel, Application, and Region

Regions Covered

North America, Europe, Asia-Pacific, South America, and Middle East & Africa

Fastest Growing Region

North America

Largest Region

Asia-Pacific

Report Insights Covered

Competitive Landscape Analysis, Company Profile Analysis, Market Size, Share, Growth, Demand, Recent Developments, Mergers and Acquisitions, New Product Launches, Growth Strategies, Revenue Analysis, Porter’s Analysis, Pricing Analysis, Regulatory Analysis, Supply-Chain Analysis, and Other key Insights.

 

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Market Dynamics

Increasing Consumer Preference for Natural Products

Natural spice extracts are known for their various health benefits, including antioxidant, anti-inflammatory, and antimicrobial properties. Consumers are increasingly aware of the potential health advantages associated with consuming natural spices, leading to a higher demand for products containing natural spice extracts. Market growth is fueled by the perception of natural spice extracts as functional ingredients that contribute to overall health and well-being.

Natural spice extracts, derived from herbs and spices without artificial additives, align with this preference for clean-label products. This drives market growth as manufacturers respond to consumer demand by incorporating natural spice extracts into their formulations. For instance, on June 23, 2023, Aroma Sciences introduced a series of exceptionally aromatic, natural oak barrel extracts utilizing an innovative evaporative extraction technology, approved by the TTB and compliant with FDA regulations.

Expanding Food and Beverage Industry

As the food and beverage industry expands, there is a growing need for product innovation and differentiation to meet consumer preferences and market demands. Natural spice extracts offer a versatile and flavorful ingredient option for manufacturers to create unique and appealing products. The availability of a wide variety of natural spice extracts allows for the development of diverse flavor profiles, catering to the tastes of different consumer segments and driving market growth through increased product offerings.

Consumers are increasingly seeking natural and clean-label products with the rising awareness of health and wellness. Natural spice extracts, derived from botanical sources without artificial additives or preservatives, align with this consumer preference for clean-label ingredients. As a result, manufacturers in the food and beverage industry are incorporating natural spice extracts into their formulations to meet consumer demand for natural and wholesome products, driving market growth.

For instance, in September 2022, Dabur India, a leading FMCG company, entered the spices market with the introduction of Dabur Hommade Tasty Masala. Within less than a year, in January 2023, the company expanded its presence by acquiring a 51% equity stake in Badshah Masala Private Limited, a renowned domestic producer, marketer, and exporter of powdered spices and seasonings. The acquisition, valued at Rs 5,87.52 crore ($71.2 million), strategically positions Dabur India in the Indian packaged herbs, spices, and seasonings market, estimated at $1.5 billion.

High Cost of Production

The high production costs associated with natural spice extracts often result in higher prices for products containing these ingredients. In a price-sensitive market, consumers are reluctant to purchase products with premium pricing, and more affordable alternatives are available. This can limit the market demand for natural spice extract products, particularly among price-conscious consumers, thereby constraining market growth.

Manufacturers operating in the food and beverage industry face competitive pricing pressure from rivals offering products with synthetic flavorings, which are more cost-effective to produce. To remain competitive, companies are compelled to reduce their profit margins or increase prices, potentially eroding market share in price-sensitive market segments. This competitive pricing pressure can hinder market expansion for natural spice extracts, and cost disparities are significant.

For instance, according to the Indian Government Department of Science and Technology, the high production costs associated with natural spice extracts are acting as a significant constraint on market growth. The requirements for establishing a production facility: a plot of approximately 300 square meters, with a constructed area of 150 square meters, is deemed suitable for the envisioned production capacity. The cost implications are noteworthy, with land acquisition alone amounting to Rs. 1.50 lakhs, while the estimated expenses for civil work are projected at Rs. 9.75 lakhs. These substantial upfront costs for land and construction pose a barrier to entry for prospective producers, limiting the expansion of the natural spice extracts market.

Segment Analysis

The global natural spice extracts market is segmented based on source, form, distribution channel, application, and region.

Ease of Integration in Formulations and Convenience in Liquid Spice Extracts

The liquid segment holds the largest share of the global natural spice extracts market. Liquid natural spice extracts offer versatility and convenience in applications across various industries such as food and beverage, pharmaceuticals, and cosmetics. Their liquid form allows for easy incorporation into a wide range of products, including sauces, beverages, confectionery, and personal care products, making them highly sought after in the market.

Liquid spice extracts can be seamlessly integrated into formulations to achieve desired flavor profiles and sensory attributes. Manufacturers value the ease of incorporation offered by liquid extracts, which allows for precise control over flavor intensity and consistency in final products. This attribute drives the widespread adoption of liquid spice extracts across the food and beverage industry.

Geographical Penetration

The abundance of Natural Resources, and Innovations in the Asia-Pacific

Asia-Pacific dominates the global natural spice extracts market. The Asia-Pacific region is rich in biodiversity and natural resources, including a wide variety of herbs and spices. This abundance of raw materials provides a significant advantage for the production of natural spice extracts, allowing manufacturers in the region to access a diverse range of botanical sources for extraction.

Market players in the Asia-Pacific region are investing in innovation and product development to meet the evolving needs and preferences of consumers. This includes developing new extraction techniques, blends, and applications for natural spice extracts. By offering innovative and differentiated products, manufacturers in the region can capture a larger share of the global market and solidify their dominance.

COVID-19 Impact Analysis

The pandemic disrupted global supply chains, causing logistical challenges and delays in the transportation of raw materials and finished products. Restrictions on movement and trade disruptions hampered the availability of natural spice extracts, leading to supply shortages and affecting market operations. Many spice processing plants and extraction units faced operational disruptions, leading to decreased output and hindering the production of natural spice extracts.

The pandemic prompted a shift in consumer preferences toward health and wellness products, including natural and clean-label ingredients. As consumers became more health-conscious, there was an increased demand for products containing natural spice extracts known for their health-promoting properties. This shift in consumer behavior positively impacted the market demand for natural spice extracts.

Russia-Ukraine War Impact Analysis

The conflict led to disruptions in supply chains, particularly for natural spice extracts sourced from Ukraine, Russia, and neighboring regions. Transportation routes were disrupted, leading to delays in the delivery of raw materials and finished products. This disruption in the supply chain affected market operations and led to shortages of natural spice extracts in certain regions.

The war adversely affected production activities in conflict-affected areas, including Ukraine. Spice processing plants and extraction units faced operational challenges due to the conflict, leading to decreased output and affecting the availability of natural spice extracts in the market. Market players in these regions struggled to maintain production levels amidst the turmoil.

Key Developments

  • On December 12, 2023, Kalsec Inc., MI, launched a state-of-the-art finishing and distribution center in Singapore, further solidifying its presence and services in the Asia Pacific region. Specializing in food ingredients such as natural flavor, natural color, and natural food-protection ingredients, Kalsec Inc. offers a diverse range of products. This includes natural taste and sensory ingredients such as herb and spice extracts, culinary alliums, and natural hot and spicy ingredients.
  • On November 27, 2023, Steadfast Nutrition introduced HerbFast Protein, a protein supplement dubbed as 'India's Protein Efficiency Formula'. This innovative blend consists of 23.3 g of whey protein combined with natural herbs and spices, vitamin B complex, digestive enzymes, green tea extract, L-carnitine, and taurine, catering to the diverse nutritional needs of consumers.
  • On May 1, 2023, Natural Chaga OÜ launched the prompt availability of certified organic MUSHEEZ Oral Sprays in Europe, introducing a pioneering delivery method for some of the most sought-after functional mushroom extracts, including chaga, reishi, and lion's mane.

Competitive Landscape

The major global players in the natural spice extracts market include Avi Naturals, Ziran India, Kalsec Inc., Naturalin Bio-Resources Co., Ltd, Mane Kancor, Lionel Hitchen Limited, Synthite Industries Ltd, Akay Natural Ingredients Private Limited, Döhler GmbH, and Holy Lama Naturals Ltd.

Why Purchase the Report?

  • To visualize the global natural spice extracts market segmentation based on source, form, distribution channel, application, and region, as well as understand critical commercial assets and players.
  • Identify commercial opportunities by analyzing trends and co-development.
  • Excel data sheet with numerous global natural spice extracts market-level data points with all segments.
  • PDF report consists of a comprehensive analysis after exhaustive qualitative interviews and an in-depth study.
  • Product mapping available as excel consisting of critical products of all the major players.

The global natural spice extracts market report would provide approximately 70 tables, 66 figures, and 213 Pages.

Target Audience 2024

  • Manufacturers/ Buyers
  • Industry Investors/Investment Bankers
  • Research Professionals
  • Emerging Companies
FAQ’s

  • The market is expected to grow from $2.56 billion in 2023 to $5.75 billion by 2031, with a CAGR of 10.65% during 2024-2031, driven by increasing consumer preference for natural and organic food products.

  • The Asia-Pacific region holds the largest share, followed by North America. The Asia-Pacific's rich biodiversity and cultural preferences for authentic flavors contribute significantly to its dominance in the market.

  • Avi Naturals, Ziran India, Kalsec Inc., Naturalin Bio-Resources Co., Ltd, Mane Kancor, Lionel Hitchen Limited, Synthite Industries Ltd, Akay Natural Ingredients Private Limited, Döhler GmbH, and Holy Lama Naturals Ltd.

  • The global natural spice extracts market is segmented based on source, form, distribution channel, application, and region.
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