Oleochemicals are chemicals that are derived from plant and animal fats and oils. They are renewable, biodegradable, and non-toxic, making them an important class of chemicals for a range of industries, which are produced by a process called saponification that involves breaking down fats & oils into their components fatty acids & glycerin. The common types of oleochemicals are fatty acids, fatty alcohols, glycerin, esters, and surfactant. Oleochemicals have several advantages over petroleum-derived petrochemicals. In addition to that, it serves a low carbon footprint since they are derived from natural feedstocks with versatile application in areas from personal care products and food to pharmaceuticals and industrial applications.
The increasing trend of shifting toward bio-based products such as biofuels, bioplastics, and bio-lubricants, which are derived from renewable sources. Consumers becoming more environmentally conscious generated the demand for sustainable and renewable chemicals. Hence, the need for Oleochemicals increased since it is used as a raw material for bio-based product manufacturing, which is extracted from renewable feedstocks. Further, the end-user industries such as personal care, pharmaceuticals, textile, and so on are involved in the production and launching of products which has a composition of Oleochemicals that drive this market in the coming years as predicted.
The Global Oleochemicals Market has witnessed a growth value of $22.66 billion in 2022. This market is expected to grow from $24.29 billion in 2023 to $39.52 billion in 2030 with a CAGR of 7.2% in the forecast period of 2023-2030. This market is estimated based on different key pointers that attribute to the growth which are products such as Specialty Esters, Glycerol Esters, Alkoxylates, Fatty Acid Methyl Ester, Fatty Amines, others, applications including Personal Care & Cosmetics, Consumer Goods, Food & Beverages, Textiles, Paint & Inks, Industrial, Health & Pharmaceuticals, Polymer & Plastic Additives, Others, forms such as Liquid, Solid, Flakes, Pellets, Beads, Others, and feedstock such as Palm, Soy, Rapeseed, Sunflower, others. Leading companies such as Vantage Specialty Chemicals, Inc., Emery Oleochemicals, Evonik Industries AG, Wilmar International Ltd., Kao Chemicals Global, Ecogreen Oleochemicals, Cargill Incorporated, Godrej Industries, and Stephan Company are having a well-established process for extracting Oleochemicals from potential feedstocks and extended their presence in global level.
The Cosmetics & Personal Care Industry segment holds a huge market share of 21% in 2022 of Oleochemicals containing products. Since they are widely used in the production of personal care and cosmetic products, including soaps, shampoos, conditioners, lotions, and creams. Further, these chemicals are utilized as an emulsifier, surfactants, and moisturizers. They are also used as thickeners and stabilizers, as well as to improve the texture and feel of the products. Overall, the cosmetics and personal care industry is a key driver of the oleochemicals market and is expected to continue to drive growth in the coming years.
Asia-Pacific region holds the largest revenue share for Oleochemical products. Majorly, these products are manufactured in Indonesia and Malaysia which led to a growth of the market. Further, the region's growing population, rising disposable incomes, and changing consumer preferences are driving the demand for personal care and cosmetic products, which in turn is driving the demand for oleochemicals. In addition to that, the Asia-Pacific region has larger accessibility for feedstock due to its leading agriculture sector that delivers the major raw material for the production of oleochemicals. At the same time, the low cost of raw materials, ease of availability, increased adoption of oleochemicals in different industries, and reduce dependence on fossil fuels allow the industries to comply with government policies, predicted to grow the Oleochemicals market.
Oleochemicals got a vast range of applications extended to different Industries significantly growing its presence as expected in the forecast period and driven by the demand for switching industries to develop green chemicals. It is recommended that companies should explore new product applications and markets to diversify their customer base and revenue streams in the oleochemicals. Strengthening their research teams to discover reliable feedstocks which are renewable and reduce carbon footprints would support placing their product in a competitive position in the existing market.