Mentha Oil

Mentha Oil Global Market Outlook:

MARKET SIZE (2022 E)

$216 Million (Expected to grow at a CAGR of 8.3 percent by 2025)

Availability (2022 E) : 26.2 Thd MT

Key Market Drivers

• Increasing demand for natural products

• Awareness regarding health and wellness

Key Market Constraints

• Weather fluctuations and heat waves

• Government regulations in the downstream

Industry Overview: E.Oils

The global essential oil production is estimated to grow at a CAGR of 8.8 percent from 2021 to 2026, and it is primarily driven by the growth of few key essentials oils, such as orange oil, mint oils, clove oil, and patchouli oil. Robust growth of end-use industries, such as food & beverage, personal care & cosmetics, and aromatherapy, has translated into an upswing in the demand for the product. The orange segment is the highest contributor in the global essential oils market share, with $3 billion in 2018, and is estimated to reach $6.2 billion by 2026, at a CAGR of 9.3 percent from 2021 to 2026.

• The global essential oil production is estimated to grow at a CAGR of 8.8 percent from 2021 to 2026

• In terms of demand, Asia Pacific is expected to witness the highest growth, of approx. 9 percent, from 2021 to 2026

• Orange oil leads the segment, by market share of approx. 29 percent and is projected to grow at approx. 9 percent/year. Food & beverages segment leads all applications with over 30 percent

• Europe and Asia Pacific leads in terms of market share (over 40 percent) and projected growth (approx. 9 percent/year)

• Growing consumer awareness is a key driving factor for the global E.Oil market over the speculated period. A major shift from synthetic to natural additives is seen due to the growth in the organic products industry

• Growing use of E.Oil in the preparation of natural flavors and fragrances on account of their increasing demand across key end-use industries is also expected to fuel the market growth

Porter's Analysis on Mentha Oil

Supplier Power

• Mint oil is produced at the farm level in many parts of India where the capacities are split into numerous players.

• Highly fragmented industry with intrusion of many middlemen and distributors

Barriers to New Entrants

• Entry of players at Tier II raw material level is feasible as those are built up with middlemen.

• High capital cost and processing skills restrain new entrants in the market.

Intensity of Rivalry

• Supplier market of natural menthol is highly consolidated with top 5-8 players holding > 80 percent of the market share. 

• Quality of the product defines the competition and remains the key differentiating factor.

Threat of Substitutes

• Natural menthol is usually replaceable by synthetic variants.

• In the past two years, use of synthetic menthol were high owing to the huge price differential between the duo.

• Currently the price gap is widening with a difference of $14/kg.

Buyer Power

• Buyer power of natural menthol is high for pharmaceutical buyers as they buy huge volumes while CPG firms have medium buyer power.

• As quality determines the cost of the product, buyer power remain low to medium.