Global oleochemicals in cosmetics market size was valued at USD 2.61 billion in 2023, which is expected to grow to USD 4.52 billion in 2031 with a CAGR of 7.12% during the forecast period between 2024 and 2031.
The booming cosmetics industry is accelerating the growth of oleochemicals in the cosmetics market. For instance, according to the latest statistics published by the International Trade Administration (ITA), the Canadian cosmetics industry generated an annual revenue of USD 1.24 billion in 2021. Also, the cosmetics industry in Canada is projected to grow by 1.45% annually to reach USD 1.8 billion in 2024.
The significant share of the Asia-Pacific region is augmenting the growth of the market. For instance, according to the recent data published by the Cosmetics Europe-The Personal Care Association, a global cosmetics & personal care association, in 2022, China was the third largest market for the cosmetics & personal care industry valued at USD 74.8 billion.
Cosmetic manufacturers are looking for alternatives to petrochemical-derived chemicals as environmental concerns gain importance. Oleochemicals, which are made from organic, renewable feedstocks such as animal fats and vegetable oils, serve as one of the most lucrative alternatives. They are attracting both manufacturers and consumers due to their bio-based makeup and diminished environmental impact, which promotes the shift to more sustainable practices in several industries. Oleochemicals are used in a variety of consumer products, such as detergents, cosmetics, and personal care items. The demand for oleochemicals in the formulation of these everyday items has increased due to the shift of consumer preference towards natural and environmentally friendly products.
Oleochemicals are widely consumed by the personal care industry, which includes the cosmetics industry. These chemicals are used to make soaps, shampoos, and other cosmetic products. The growing consumer preference for safer and natural ingredients due to their increased knowledge of the possible negative effects of synthetic chemicals is another factor driving the demand for oleochemicals in the cosmetics industry. The increased use of oleochemicals in the cosmetics industry has also been facilitated by the expansion of oilseed plantations in several countries along with the rising usage of oilseed chemicals for personal care products.
Moreover, another significant factor driving the market for oleochemicals is regulatory support for bio-based products. The use of renewable and bio-based chemicals is being encouraged by policies and incentives being implemented by governments and regulatory bodies worldwide. These regulations encourage companies to use oleochemicals as a safe substitute for traditional chemicals, especially in the cosmetic manufacturing sectors. Additionally, the increasing use of oleochemicals across numerous industries is also influenced by strict regulations pertaining to environmental protection and emissions reduction.
Booming Cosmetic Sector to Drive the Demand for Oleochemicals
Oleochemicals are widely used in the cosmetic industry because of their numerous advantages, qualities, and adaptability. They are essential components in a variety of cosmetics, such as skincare, haircare, and other personal care products. Oleochemicals are being widely used in the cosmetics industry to meet the rising consumer demand for organic and environmentally friendly products. The robust expansion of the cosmetics industry at the global level is attributed to vital aspects such as a shift in the focus of gender-specific personal care products, the inclusion of natural ingredients, and the increasing trend for high-end luxury cosmetics products.
For instance, according to the 2022 Loreal Annual reports the company witnessed an 18.5% rise in sales reaching USD 42.62 billion in sales during that year. This rise in sales is likely to continue and which in turn raises the demand for oleochemicals. Also, according to the statistics published by the Cosmetics Europe — The Personal Care Association, in 2022, the United States was the leading market for cosmetics and personal care products valued at USD 102.14 billion, with an annual growth rate of 21.25%. In addition, according to the recent report published by the Confederation of European Paper Industries (CEPI), in 2022, the total turnover of the paper & pulp industry in Europe was valued at USD 121,100.6 million (EURO 115,000 million), an increase of 21.1%. Oleochemicals being sustainable compared to its petrochemical alternatives in cosmetic production aligns with consumer sentiments and further contributes to the growth of the oleochemicals market.
Strong Feedstock Availability to Raise Oleochemicals Adoption
The wide range of feedstock options ensures a steady and regular supply of raw materials for oleochemical producers. Additionally, it lessens reliance on feedstock sources, lowering the risk of supply chain disruptions. The availability of a wide range of feedstock sources, including greases, animal fats, and vegetable oils, is essential for the production and use of oleochemicals promoting growth of the market.
For instance, crude glycerol is a byproduct created during the process of turning these feedstocks into biodiesel. Glycerin is an essential oleochemicals used in numerous industries, including cosmetics, which can be found in significant amounts in crude glycerol. Therefore, the increasing usage of biofuel increases the need for availability of feedstock and strengthens the oleochemicals market.
Beneficial Regulation and Shifting Consumer Preference to Promote Oleochemicals in Cosmetics Manufacturing
The market for cosmetics has been significantly expanding due to the growing interest in eco-friendly products. The demand for natural or sustainable ingredients in cosmetics from both consumers and retailers has led to a 15% annual growth rate in the green cosmetics market.
In addition, cosmetic manufacturers are moving away from petrochemicals, which is driving up demand for oleochemicals in the personal care sector. Given that fatty acids constituted 57% of the demand for all oleochemical products, shows the increased usage of oleochemicals in the cosmetics sector.
For instance, in 2022, an astounding 56,000 products and ingredients were awarded the COSMOS accolade, marking a 22% annual increase. This number demonstrates how important eco-conscious credentials are to consumers as well as brands. Furthermore, according to the recent data published by Forbes, when purchasing anything related to beauty or wellbeing, nine out of ten consumers feel that sustainable factors are crucial.
Impact of COVID-19
The effects of COVID-19 on the global oleochemicals in cosmetics market were both positive and negative i.e. neutral. COVID-19-related supply shortages, demand discrepancies, and logistical issues all disrupted the oleochemicals market. Moreover, various cosmetics manufacturing at the global level halted their production activities, which, in turn, restricted the growth of oleochemicals in the cosmetics market.
However, the increased online sales for cosmetics products such as creams, lotions, soaps, and others boosted the demand for oleochemicals having applications in cosmetic products. This, in turn, fostered market growth in the year 2020.
Impact of Russia-Ukraine War
Since neither Russia nor Ukraine played a significant role in the oleochemicals in cosmetics industry, the effects of the Russia-Ukraine war were not severe on this market. However, manufacturers of oleochemicals in cosmetics rely on importing vegetable oils and fats from Russia and Ukraine witnessed tightness in feedstocks’ availability, which impacted the production costs. The Russian-Ukrainian conflict has caused market instability and trade disruptions globally causing fluctuation of various feedstock prices. International oleochemicals manufacturers have run into issues caused by delays and logistical uncertainty brought on by the war. However, overall the impact of Russia-Ukraine war had a limited impact on the oleochemicals in cosmetics market.
Report Scope
“Oleochemicals in Cosmetics Market Assessment, Opportunities and Forecast, 2017–2031F”, is a comprehensive report by Markets and Data, providing in-depth analysis and qualitative & quantitative assessment of the current state of the global oleochemicals market, industry dynamics and challenges. The report includes market size, segmental shares, growth trends, COVID-19 and Russia-Ukraine war impact, opportunities and forecast between 2024 and 2031. Additionally, the report profiles the leading players in the industry mentioning their respective market share, business model, competitive intelligence, etc.
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