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A report by Freedonia Group Inc. has projected demand for cosmetic chemicals in the United States to grow 4.9% annually to reach US $9.4 billion in 2016. "Cosmetic & Toiletry Chemicals to 2016" found that botanical extracts will lead the growth and that emollients and moisturizers will be the fastest growing chemicals by function.
The study presents historical demand data ( 2001, 2006, 2011) and forecasts for 2016 and 2021 by product (e.g., surfactants, aroma chemicals and blends, oleochemicals, botanical extracts, polymers, fats, oils and waxes), function (e.g., specialty additives, emollients and moisturizers, cleansing agents and foamers, fragrances and flavors, processing aids) and market (e.g., skin care products, hair care products, personal soaps and body washes, perfumes, oral hygiene products). The study also considers market environment factors, details industry structure, evaluates company market share and profiles 33 industry players, including BASF, Dow Chemical and Procter & Gamble.
The study found that consumer preference for active and natural ingredients will drive demand for products such as enzymes, amino acids, and botanical extracts. Increasing use of cosmeceutical skin care products will aid consumption of such high value additives as nanoscale ingredients. Botanical extracts will benefit from their perception as being more natural whereas ingredients perceived as being harsh such as petroleum oils and commodity surfactants will experience limited gains, primarily due to the popularity of water-based formulations in skin and hair care products, and a trend away from chemicals.
The US personal care market is driven by advancements in raw materials, including the greater use of more efficient delivery systems and nanotechnology; and the use of higher value raw materials (e.g., exotic essential oils and specialty surfactants) that may provide product differentiation or enhanced performance. Specialty additives, and emollients and moisturizing agents will register the most rapid growth in demand through 2016, as consumers expect higher performance from their cosmetic. Active ingredients in particular will post above average gains among specialty additives.
Several segments in the cosmetic industry, including organic and natural products, male grooming, ethnic products, and anti-aging, are poised for rapid growth, directly impacting the mix of the chemicals used in their formulation. Once a niche segment, organic and natural products have become more mainstream as concerns about personal health and environmental impact become more widespread. Men's products, such as specialized facial cleansers and skin care items, and higher value shaving products and hair care preparations, will continue to emerge, providing opportunities for many ingredients, including moisturizing additives. The growing Hispanic population in the United States is prompting formulators to provide items that meet the specific needs of this segment. The country's obsession with youth will continue to drive the introduction of products that contain active ingredients designed to enhance a person's appearance by reducing wrinkles, firming skin or lightening age spots. As more baby boomers move into their 50s, the number of hair care, cosmetic, and skin care products specifically formulated for gray hair and aging skin will increase. Growth in this segment will bode well for active ingredients, delivery systems and conditioning and moisturizing agents.