The global neem extract market is expected to grow, from an estimated value of $653.7 million in 2015, at a CAGR of 15.9% during 2015 to 2020. The growth is mainly driven by the increasing consumption of bio-based fertilizers and pesticides, especially in Europe. The rejuvenation of ayurveda-based therapy owing to campaigns and advertisements by the domestic ayurvedic companies, such as Patanjali (India), has increased the scope of neem extract in personal care domain. The increase in bio-based animal farming during the past few years is also expected to increase demand for neem extract globally. The increasing consumption of bio-based pesticides and fertilizers in the Asian countries is laying opportunities for the neem extract market. The key restraints for the market include less concentration of neem plantations in non-Asian countries and negative opinion of certain people about the safety profile of neem-based health products.
The increasing concern of people and regulatory authorities towards harmful effects of chemical-based fertilizers and pesticides on human health has been compelling the farmers to use bio-based farm products. This has led to a significant increase in the demand for bio-based fertilizers and pesticides. Following the effect, the demand of neem extract based fertilizers and pesticides are also escalating. The demand for organic food has also been increasing in the recent past, especially in Europe, wherein people are preferring products with organic label due to which retailers are increasing the percentage of organic products in their shelves.
Countries such as Spain, France and Denmark have reduced the agricultural chemical usage by about 30%. Among the Asian countries, China is the leading market for bio-based products including neem-extract based fertilizers and pesticides. Australia and India are the other major countries in the region using neem-extract based farm products.
The growing demand for organic food has been escalating the demand for bio based agro-product including neem extract. Several campaigns in North America and Europe against genetically modified crops have been pushing regulatory authorities to encourage organic farming. Neem based agro-products have been gaining significance in western countries, which is being reflected in the increasing market for neem extract. Neem extract is also being used widely to manufacture medicinal and personal care products for human. However, its oral consumption has been interpreted as unsafe by several organizations, and certain countries; such as Canada, have completely banned them. For animal feed and pet care products, neem extract is treated as safe and effective, and it is the key reason behind the growth of this segment.
Neem extract market is highly fragmented with a large number of small players concentrated in specific countries, who distribute their products locally as well as internationally. Most of these companies are located in the Asian countries, which are the largest consumers of neem extract products globally.
News Courtesy: P&S Market Research