Sandalwood Oil Market Size, Share, Growth and Industry Analysis by Type (Indian Sandalwood Oil, And, Australian Sandalwood Oil), By Application (Cosmetics (Perfumes), Pharmaceuticals, Aromatherapy, And, Others) Regional Forecast to 2028

Updated On: 15 May 2023

REPORT OVERVIEW

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The global sandalwood oil Market size was US$ 139 million in 2021. As per our research the market is expected to generate substantial revenue by 2028, exhibiting a high CAGR 10.5% during the forecast period. The global COVID-19 pandemic has been unprecedented and staggering, with the market experiencing higher-than-anticipated demand across all regions compared to pre-pandemic levels. The sudden rise in CAGR is attributable to the market's growth and demand returning to pre-pandemic levels once the pandemic is over

Sandalwood oil a kind of essential oil which is taken or extracted from the roots and wood of sandalwood tree. This essential oil is used in several perfumes to enhance their fragrance. These oils are derived from the very heart of sandalwood trees. It is extracted through solvent extraction, and, steam distillation. This oil consists of various chemical components. Some of them include beta-santalol and alpha-santalol. All of this has created a lot of demand for this product.

Inclination of people towards, organic, non-synthetic, and chemical free products is increasing the scope for the market. This is considered as the latest trend in the market.

Aromatherapy and ayurveda are two important domains that make use this essential oil as an important product. Numerous health benefits provided by this oil, and its use in various consumer products has contributed in market growth. All of these factors are considered as the driving factors of the sandalwood oil market growth.

COVID-19 impact: Health Benefits Provided by Sandalwood Oil Increased Market Growth

The pandemic of COVID-19 brought a health crisis in all the nations of the world. Every industry had to go through various challenges during this particular period of time. Lockdowns and strict protocols regarding social distancing norms were strictly imposed. This resulted in the scarcity of raw materials, and non-availability of skilled workforce. 

Apart from being used in perfumes this essential oil is used in various other sectors as they provide amazing health benefits. This essential oil is used from centuries in traditional medicines as they have anti-inflammatory anti-spasmodic, and anti-septic properties. These features are known to have good healing power. As a result, sandalwood oil was increasing used during the period of pandemic in treating patients in a traditional way.

LATEST TRENDS

"Growing Popularity of Natural and Organic Products to Increase Market Growth"

One of the latest trends that is noticeable in the market is the rising popularity of natural and inorganic products. The preference of people has increased towards naturally-extracted, chemical free substances and products. This has increased the demand for sandalwood oil.

Apart from being used in the treatment of ailments such as coughs, colds, digestive issues, and urinary tract infection, this essential oil is considered to be an important ingredient in skincare products. Sandalwood oil is known for its calming and soothing properties. Increasing awareness of people regarding the harmful effects of synthetic and chemical containing products will further drive the market growth. This is considered as the latest trend in the market. 

SEGMENTATION

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• By Type:

The market can be divided on the basis of type as follows:

Indian sandalwood oil, and, Australian sandalwood oil. The Indian sandalwood oil segment will be seen dominating the market in the upcoming years.

• By Application:

Classification based on application is as follows:

Cosmetics (perfumes), pharmaceuticals, aromatherapy, and, others. The cosmetics (perfumes) segment dominates the industry.

DRIVING FACTORS

"Incorporation of Sandalwood Oil in Aromatherapy to Accelerate Market Share "

One of the main components of aromatherapy is the oil extracted from sandalwood. Aromatherapy is an art of holistic healing with the use of plant extracts that are obtained naturally. Aromatherapy mainly makes use of various types of oils to treat patients. By inhaling the fragrance offered by essential oils, the body can stimulate natural healing process and promote both physical and psychological well-being.

Sandalwood is considered to be a tree with medicinal values. Therefore, it is used very frequently in aromatherapy. The fragrance of sandalwood can help in healing the immune systems of human beings. Changing lifestyle of people has resulted in increased stress, and burden. In order to reduce this unmanageable stress people are using aromatherapy. Rising demand for aromatherapy has in turn increased the demand for essential oils like sandalwood oil. All of these factors are propelling the market growth and development. 

"Use of This Essential Oil in Consumer Products to Drive Market Growth"

Oil which is extracted from sandalwood has several applications as they are used in many sectors such as personal care, aromatherapy, and pharmaceutical. Another important field where this essential oil is used is ayurveda. Along with all this, this essential oil is also used in the manufacturing of several consumer products.

This essential oil is characterized by a very unique fragrance. Therefore, they are used in the making of several products such as shampoo, hair oils, perfumes, candles, soaps, body washes, and incense sticks. The medicinal as well as the commercial use of this oil will accelerate the demand for the product. All of these factors will amplify the sandalwood oil market share.

RESTRAINING FACTOR

"Limited Availability of Sandalwood to Decline Market Growth"

A major problem that is witnessed in the market is inadequate supply of sandalwood. It is not possible to manufacture oils without the supply of ample amount of sandalwood. This tree is not grown in many regions and is highly expensive. Slow growth rates of sandalwood trees in many countries are the major reason for the inadequate supply of sandalwood.

Also, the production of this oil is highly time consuming, and also involves a lot of cost. Extraction of oil from sandalwood requires skilled labors with the right skills. Sandalwood trees require a lot of time to grow up and mature. Many government authorities in several countries have prohibited the deforestation of sandalwood forests. All of these factors can deteriorate the market growth.

Regional Insights

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"Asia Pacific to Dominate Market in Upcoming Years"

Asia Pacific is the leading region in the market due to the prevalence of several favorable factors in this region. India which is a part of Asia Pacific accounts for the largest share in the global market for sandalwood oil. As a result, Asia Pacific is considered to be the leading region in the market.

Including India, a few other countries in Asia Pacific have vast expanses of sandalwood forests. Various initiatives taken up the government in this region has led to the increased cultivation and harvesting of sandalwood trees. All of these factors have helped in the growth of the market in Asia Pacific.

Key Industry Players

"Leading Players adopt Acquisition Strategies to Stay Competitive "

Several players in the market are using acquisition strategies to build their business portfolio and strengthen their market position. In addition, partnerships and collaborations are among the common strategies adopted by companies. Key market players are making R&D investments to bring advanced technologies and solutions to the market.

List of Market Players Profiled

• Quintis (TFS)(Australia)
• Santanol (Australia)
• RK-Essential Oils (India)
• Meena Perfumery (India)
• Naresh International (India)
• Essentially Australia (Australia)
• Katyani Exports (India)
• KS&DL (Karnataka Soaps & Detergents) (India)
• Sandalwood Forest (Qingyuan) (China)
• Jiangxi Jishui Natural Essential Oil Factory (China)
• Jinagxi Xuesong (China)

Report Coverage

The report provides an insight into the crude oil industry from both the demand and supply sides. Further, it also gives information on the impact of COVID-19 on the market, the driving and the restraining factors along with the regional insights. Market dynamic forces during the forecast period have also been discussed for the better understanding of the market situations.