Capsicum Oleoresin Market Report Scope And Overview:

The Capsicum Oleoresin Market size was USD 34.71 million in 2023 and is expected to Reach USD 68.24 million by 2032 and grow at a CAGR of 7.8% over the forecast period of 2024-2032. 

Capsicum oleoresin is a viscous, reddish-brown homogenous liquid extracted from dried ripe fruits of Capsicum annum L or Capsicum fruitescens L. It is a complex chemical mixture that includes capsaicinoids, carotenoids, and flavonoids. The active chemicals in capsicum oleoresin that give chili peppers their spiciness are known as capsaicinoids.

Based on nature, the organic segment of the Capsicum Oleoresin market is expected to grow at a CAGR of 8.6% with the rising trend for organic/natural oleoresins. The solvent extraction method is widely used in the Food & Beverage Industry, Pharmaceutical, Nutraceuticals, and other end-user sectors.

Based on the end-user sector, the food and beverage category is expected to account for a sizable portion of the worldwide capsicum oleoresin market. Customers' broad usage of goods and beverages containing spice oleoresins is driving segment growth. High demand from the developing food and beverage industry is one of the capsicum oleoresin market growth factors.

MARKET DYNAMICS

KEY DRIVERS

• Rising demand for personal care and pharmaceutical products

Capsicum oleoresin is a natural chili pepper extract observed for its strong flavor as well as anti-inflammatory and analgesic qualities. Natural and organic personal care and medicinal goods are becoming increasingly popular among consumers. As capsicum oleoresin is a natural product, it appeals to consumers who want natural and organic products. Consumers are becoming more aware of capsicum oleoresin's health advantages, such as its potential to alleviate pain and inflammation, enhance skin health, and encourage hair growth. This is increasing demand for items containing capsicum oleoresin.

RESTRAIN

• Strict government regulations

Capsicum oleoresin is a food additive, it is subject to food safety standards. These laws differ from country to country, but they often compel producers to follow stringent hygiene guidelines and test their goods for dangerous pollutants. These standards are intended to safeguard the safety and quality of food goods, as well as to label the product's contents, nutritional value, and potential allergens. They can, however, make it difficult for new players to enter the market and raise costs for existing firms.

OPPORTUNITY

• Development of new applications for capsicum oleoresin

In recent years, there has been a growing interest in using capsicum oleoresin in new applications. Currently, cosmetics, nutraceuticals, and food supplements all use capsicum oleoresin. This is a result of growing knowledge of capsicum oleoresin's health advantages, including its capacity to increase metabolism, lessen discomfort, and enhance skin health. In food supplements, capsicum oleoresin is used to promote weight loss and enhance athletic performance. The market for this commodity is growing, offering opportunities for manufacturers and investors, and novel uses for capsicum oleoresin are being developed.

CHALLENGES

• The high price of capsicum oleoresin

Capsicum oleoresin is a relatively expensive food additive since it is difficult to extract and requires specific equipment and knowledge. To comply with government requirements, manufacturers must pay significant costs. These expenses may include the cost of product testing, getting permissions, and recruiting qualified employees.  The high price of capsicum oleoresin may also make entry into the market difficult for new entrants.

IMPACT OF RUSSIA UKRAINE WAR

Ukraine is a major supplier of chili peppers, which are used to make capsicum oleoresin. The war has impacted agricultural production in Ukraine, resulting in a global shortage of chili peppers. As a result, the price of chili peppers has risen, as has the price of capsicum oleoresin. Since the commencement of the war, the price of capsicum oleoresin has risen by 16%. This has resulted in lower consumer spending on non-essential items such as food additives and personal care products. Because of the war, global demand for capsicum oleoresin is predicted to fall by 3% in 2022. This has had a negative influence on the market for capsicum oleoresin.

IMPACT OF ONGOING RECESSION

Recessions have a substantial impact on the capsicum oleoresin industry as they can reduce consumer spending and hamper corporate activity. Consumers are more inclined to cut back on discretionary expenditures, such as food and personal care products, during a recession. This could result in a drop in demand for capsicum oleoresin. Raw materials, labor, and transportation costs can all rise as a result of inflation. This may increase the cost of producing capsicum oleoresin, resulting in higher pricing for customers. In 2023, global production of capsicum oleoresin is predicted to fall by 5%. 

MARKET SEGMENTATION

By Nature

• Organic

• Conventional

By Extraction Method

• Solvent Extraction

• SCFE

By End-user

• Food & Beverage Industry

• Pharmaceutical

• Nutraceuticals

• Retail / Household

• Other

REGIONAL ANALYSIS

North America is estimated as the largest market for capsicum oleoresin, followed by Europe and Asia Pacific. Capsicum oleoresin is in high demand in North America due to the growing popularity of spicy foods and the expanding use of capsicum oleoresin in the food and beverage, personal care, and pharmaceutical industries.

Europe is the second-largest market for capsicum oleoresin. The increasing need for natural and organic products, as well as the increasing use of capsicum oleoresin in the food and beverage, personal care, and pharmaceutical industries, are driving the high demand for capsicum oleoresin in Europe.

Asia Pacific is a rapidly increasing market for capsicum oleoresin in 2022. The growing population, increased urbanization, and rising disposable incomes all contribute to Asia Pacific's high demand for capsicum oleoresin. The increasing popularity of spicy food, as well as the increasing use of capsicum oleoresin in the food and beverage, personal care, and pharmaceutical industries, are driving demand for capsicum oleoresin in Asia Pacific.

REGIONAL COVERAGE

North America

• US

• Canada

• Mexico

Europe

• Eastern Europe

  • Poland

  • Romania

  • Hungary

  • Turkey

  • Rest of Eastern Europe

• Western Europe

  • Germany

  • France

  • UK

  • Italy

  • Spain

  • Netherlands

  • Switzerland

  • Austria

  • Rest of Western Europe

Asia Pacific

• China

• India

• Japan

• South Korea

• Vietnam

• Singapore

• Australia

• Rest of Asia Pacific

Middle East & Africa

• Middle East

  • UAE

  • Egypt

  • Saudi Arabia

  • Qatar

  • Rest of Middle East

• Africa

  • Nigeria

  • South Africa

  • Rest of Africa

Latin America

• Brazil

• Argentina

• Colombia

• Rest of Latin America

KEY PLAYERS

Some major key players in the Capsicum Oleoresin Market are BOS Natural Flavors Pvt. Ltd, Synthite Industries Ltd., UniversalOleoresins, Vidya Herbs, India Essential Oils, HDDES Group, Bioingredia Natural Pvt Ltd., Ozone Naturals, Trilogy Essential Ingredients, Inc., Akay Flavours & Aromatics, Plant Lipids, AVT Natural Products, and other key players.

Synthite Industries Ltd-Company Financial Analysis

RECENT DEVELOPMENTS

In 2022, Synthite, an oleoresin maker, aims for a 4,000 Cr turnover in three years. The new factory in Kochi is expected to generate an additional 500-600 crore in revenue.