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Flavors and Fragrances

Specialty Chemicals Update Program

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Published October 2021

Flavors and fragrances are integral components of a wide range of consumer goods. Natural and synthetic flavor compositions are responsible for the fruity taste of cherry cola and the cool mint flavor of toothpaste. Fragrance compositions add the fresh scent of pine to household cleaning products and exotic top notes to fine perfumes. Worldwide consumption of flavor and fragrance (F&F) products—flavor and fragrance compositions as well as the essential oils, natural extracts, and aroma chemicals that serve as starting materials—amounted to almost $40 billion in 2018 (merchant sales of F&F products only). The use of aroma chemicals (which are primarily synthetic) has increased at the expense of essential oils and extracts of natural origin. Synthetic aroma chemicals generally offer security of supply and price stability, whereas essential oils and natural extracts can be subject to supply shortages and price volatility.

Mature markets—North America, Western Europe, and Japan—accounted for less than half of 2018 consumption value; developing markets—Latin America, Central and Eastern Europe, the Middle East, Africa, China, and Other Asia—made up the remainder.

The following pie chart shows world consumption of flavor and fragrance products:

Analysis of global consumption by product category over time shows that the use of aroma chemicals (which are primarily synthetic) has increased at the expense of essential oils and extracts of natural origin, despite increased consumer interest in natural ingredients.

Sales of flavor compositions generally exceed sales of fragrance compositions; in Other Asia, however, the opposite is true. Sales of aroma chemicals typically exceed sales of essential oils and natural extracts; in Japan, sales of essential oils and natural extracts exceed those of aroma chemicals. Japan’s consumption of fragrance compositions is much smaller than its consumption of flavor compositions, and thus demand for aroma chemicals—the raw materials for compounded fragrances—is smaller. Consumption of F&F ingredients (essential oils, natural extracts, and aroma chemicals) is comparatively low in regions that are strongly dependent on imported flavor and fragrance compositions, such as Central and Eastern Europe, the Middle East, and Africa.

Important trends in the F&F industry include the following:

  • Increased interest in healthy eating. Demand for “better-for-you” foods—foods with wholesome ingredients and reduced salt, fat, or sugar content—is growing. Sophisticated flavor systems can help food manufacturers reduce the salt or calorie content of their products without sacrificing taste.
  • Consumer preference for natural (as opposed to artificial) ingredients. Many consumers believe that natural ingredients are safer, healthier, and better for the environment than their synthetic counterparts. Demand for foods and beverages that are free of artificial or chemical-sounding ingredients, including artificial flavors, colors, and sweeteners, is growing. The growing consumer preference for natural ingredients also affects the personal care, home care, and fabric care product industries.
  • Strong demand for convenience foods, including microwaveable and prepared foods, in developed markets. This trend has generally increased the demand for flavors.
  • Increased consumer interest in bold flavors and a willingness to experiment with novel and artisanal foods with nontraditional or exotic flavor profiles.
  • Consumer and corporate concerns about the sustainability and environmental impact of certain F&F ingredients such as vanilla, sandalwood, and agarwood.
  • The growing influence of social media, consumer activists, advocacy groups, and retailers in framing the discussion about ingredients in food and personal care products.
  • Heightened concerns about the allergic potential of widely used fragrance ingredients.
  • Consumer demand for transparency with respect to fragrance ingredients, including full disclosure of fragrance components in household cleaning and personal care products.
  • The expanding role of biotechnology and fermentation processes in the production of aroma chemicals such as vanillin, nootkatone, and valencene.

Worldwide consumption of F&F products is expected to grow at an average annual rate of about 3.5% over the next five years. The potential for growth is greater in China, Other Asia and Oceania (especially India, the Philippines, and Thailand), and the Middle East than in the comparatively mature markets of North America, Western Europe, and Japan. GDP growth, urbanization, the expansion of the middle class, and increased demand for consumer products will drive consumption growth in developing countries.

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Contents

Executive summary 15
Summary 17
Overview of the flavor and fragrance industry 25
World 25
Structure of the industry 25
Flavor and fragrance compositions 26
Competitive landscape 26
Market participants 27
Essential oils and natural extracts 29
Competitive landscape 29
Market participants 30
Aroma chemicals 33
Competitive landscape 33
Market participants 36
Operating characteristics 38
Flavor and fragrance compositions 38
Manufacturing 39
Research and development 40
Profitability 42
Regulatory issues 43
Essential oils and natural extracts 45
Manufacturing 46
Research and development 47
Profitability 47
Regulatory issues 47
Aroma chemicals 47
Manufacturing 48
Research and development 51
Profitability 52
Regulatory issues 52
Critical factors for success 53
Trends and opportunities 54
Flavors 54
Fragrances 55
F&F raw materials 56
North America 57
Structure of the industry 57
Recent acquisitions 59
Company profiles 61
International Flavors & Fragrances, Inc. 61
Sensient Technologies Corporation 65
Operating characteristics 69
Marketing 69
Cost structure and profitability 69
Government regulations 69
Flavors 69
United States 69
Canada 70
Fragrances 71
United States 71
Canada 72
Trends and opportunities 72
Latin America 74
Structure of the industry 74
Company profiles 76
Aromax Indústria e Comércio Ltda. 76
Carlos Cramer Productos Aromáticos S.A.C.I. 76
Dierberger Fragrâncias SA 76
Duas Rodas Industrial Ltda. 77
Saporiti S.A. 77
Government regulations 77
Flavors 77
Fragrances 79
Trends and opportunities 79
Western Europe 80
Structure of the industry 80
Corporate activities 87
Company profiles 90
ADM WILD Europe GmbH/ADM WILD Flavors & Specialty Ingredients (WFSI) 90
Firmenich SA 91
Givaudan SA 92
V. Mane Fils S.A. 95
Robertet SA 96
Symrise AG 97
Operating characteristics 99
Marketing 99
Cost structure and profitability 100
Government regulations 100
Flavors 101
Fragrances 102
Essential oils and natural extracts 102
Aroma chemicals 103
Trends and opportunities 103
Demographics 103
Society, customer perception, tastes, fashion, and life cycles 103
Natural products, plant versus animal 104
Government policies and regulations 104
Research and development 104
Raw materials 105
Products 105
Central Europe 106
CIS and Baltic States 106
Middle East 107
Structure of the industry 107
Company profiles 109
Africa 110
Indian Subcontinent 111
Mainland China 112
Structure of the industry 112
Company profiles 115
Huabao International Holdings, Ltd. 115
Jiaxing Zhonghua Chemical Industry Co., Ltd. 116
Operating characteristics 116
Manufacturing 116
Marketing 116
Government regulations 117
Trends and opportunities 118
Japan 119
Structure of the industry 119
Company profiles 121
T. Hasegawa Co., Ltd. 121
Ogawa & Co., Ltd. 122
Soda Aromatic Co., Ltd. 122
Takasago International Corporation 123
Operating characteristics 124
Marketing 124
Cost structure and profitability 125
Government regulations 126
The Law Concerning the Examination and Regulation of Manufacture, etc. of Chemical Substances 126
Labeling 127
Positive list 127
Other 128
Trends and opportunities 128
South Korea and Taiwan 128
Structure of the industry 128
South Korea 128
Taiwan 129
Southeast Asia and Oceania 129
Structure of the industry 129
Indonesia 129
Singapore 129
Thailand 130
Products 131
Flavor and fragrance compositions 131
Flavor compositions 131
Fragrance compositions 134
Essential oils and natural extracts 136
Aroma chemicals 139
Benzenoid compounds 140
Musk chemicals 143
Terpenes and terpenoids (cyclic and acyclic) 144
Other aroma chemicals 145
Markets 148
World overview 148
North America 151
Summary 151
Flavor and fragrance compositions 151
Consumption 151
Market participants 153
Trade 162
Price 163
Essential oils and natural extracts 163
Consumption 163
Market participants 164
Trade 165
Price 167
Aroma chemicals 168
Consumption 168
Market participants 169
Trade 170
Price 172
Latin America 173
Summary 173
Flavor and fragrance compositions 174
Consumption 174
Market participants 175
Trade 190
Price 191
Essential oils and natural extracts 191
Consumption 191
Market participants 192
Trade 193
Price 194
Aroma chemicals 195
Consumption 195
Market participants 196
Trade 197
Price 198
Western Europe 199
Summary 199
Flavors and fragrance compositions 200
Consumption 200
Market participants 202
Trade 217
Price 219
Essential oils and natural extracts 220
Consumption 220
Market participants 221
Trade 221
Price 224
Aroma chemicals 224
Consumption 224
Market participants 226
Trade 226
Imports 226
Exports 227
Price 228
Central Europe 229
Summary 229
Flavor and fragrance compositions 230
Consumption 230
Market participants 231
Trade 234
Price 236
Essential oils and natural extracts 236
Consumption 236
Market participants 237
Trade 238
Price 239
Aroma chemicals 240
Consumption 240
Market participants 241
Trade 242
Price 243
CIS and Baltic States 244
Summary 244
Flavor and fragrance compositions 245
Consumption 245
Market participants 247
Trade 249
Price 250
Essential oils and natural extracts 250
Consumption 250
Market participants 251
Trade 251
Price 253
Aroma chemicals 254
Consumption 254
Market participants 255
Trade 256
Price 257
Middle East 258
Summary 258
Flavor and fragrance compositions 259
Consumption 259
Market participants 260
Trade 264
Price 266
Essential oils and natural extracts 267
Consumption 267
Market participants 267
Trade 267
Price 269
Aroma chemicals 270
Consumption 270
Market participants 271
Trade 272
Price 273
Africa 274
Summary 274
Flavor and fragrance compositions 275
Consumption 275
Market participants 276
Trade 282
Price 283
Essential oils and natural extracts 284
Consumption 284
Market participants 284
Trade 285
Price 287
Aroma chemicals 288
Consumption 288
Market participants 289
Trade 290
Price 291
Indian Subcontinent 292
Summary 292
Flavor and fragrance compositions 293
Summary 293
Salient statistics 293
Consumption 294
Market participants 295
India 311
Consumption 311
Trade 312
Pakistan 313
Consumption 313
Trade 315
Sri Lanka 315
Consumption 315
Trade 317
Essential oils and natural extracts 317
Salient statistics 317
Consumption 318
Market participants 318
India 319
Consumption 319
Trade 319
Pakistan 321
Consumption 321
Trade 322
Sri Lanka 324
Consumption 324
Trade 325
Aroma chemicals 327
Consumption 327
Market participants 329
Synthite Industries Ltd. 329
Privi Organics Pvt. Ltd. 329
Trade 329
India 330
Consumption 330
Trade 330
Pakistan 333
Consumption 333
Trade 333
Sri Lanka 334
Consumption 334
Trade 335
Mainland China 336
Summary 336
Flavor and fragrance compositions 337
Salient statistics 337
Consumption 337
Market participants 341
Trade 345
Price 346
Essential oils and natural extracts 346
Salient statistics 346
Market participants 348
Trade 349
Price 353
Aroma chemicals 355
Salient statistics 355
Consumption 356
Market participants 357
Trade 360
Price 364
Japan 366
Summary 366
Flavor and fragrance compositions 366
Salient statistics 366
Consumption 367
Market participants 370
Trade 371
Price 371
Future trends and strategic issues 372
Essential oils and natural extracts 372
Salient statistics 372
Consumption 373
Market participants 374
Trade 374
Price 376
Aroma chemicals 377
Consumption 377
Market participants 381
Trade 384
Price 385
Future trends and strategic issues 386
South Korea and Taiwan 387
Summary 387
South Korea 387
Taiwan 387
Flavor and fragrance compositions 388
Consumption 388
Market participants 389
South Korea 391
Salient statistics 391
Consumption 391
Trade 392
Taiwan 393
Salient statistics 393
Consumption 393
Trade 395
Essential oils and natural extracts 395
Consumption 395
Market participants 396
South Korea 396
Salient statistics 396
Consumption 397
Trade 397
Taiwan 399
Salient statistics 399
Consumption 399
Trade 400
Aroma chemicals 402
Consumption 402
Market participants 403
South Korea 404
Consumption 404
Trade 404
Taiwan 406
Consumption 406
Trade 407
Southeast Asia and Oceania 409
Summary 409
Flavor and fragrance compositions 409
Summary 409
Salient statistics 410
Consumption 410
Market participants 412
Indonesia 422
Consumption 422
Trade 423
Malaysia 424
Consumption 424
Trade 425
Philippines 426
Consumption 426
Trade 427
Singapore 428
Consumption 428
Trade 429
Thailand 430
Consumption 430
Trade 431
Vietnam 432
Consumption 432
Trade 433
Australia 434
Consumption 434
Trade 435
New Zealand 436
Consumption 436
Trade 437
Essential oils and natural extracts 438
Salient statistics 438
Consumption 438
Market participants 440
Trade 440
Indonesia 440
Consumption 440
Trade 441
Malaysia 443
Consumption 443
Trade 444
Philippines 446
Consumption 446
Trade 447
Singapore 449
Consumption 449
Trade 450
Thailand 452
Consumption 452
Trade 453
Vietnam 455
Consumption 455
Trade 456
Australia 458
Consumption 458
Trade 459
New Zealand 461
Consumption 461
Trade 462
Aroma chemicals 464
Consumption 464
Trade 466
Indonesia 467
Consumption 467
Trade 468
Malaysia 469
Consumption 469
Trade 470
Singapore 472
Consumption 472
Trade 473
Thailand 474
Consumption 474
Trade 475
The Philippines 477
Consumption 477
Trade 477
Vietnam 478
Consumption 478
Trade 479
Australia 480
Consumption 480
Trade 481
New Zealand 482
Consumption 482
Trade 482
Trends and opportunities 484
Appendix I: Vanillin and ethyl vanillin producers 485
Appendix II: Menthol producers 490
Appendix III: Geographic regions 495
Additional resources 496
Revisions 498
Data Workbook 499
Notice 500

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