Castor Oil Market

Market Overview

The global castor oil market size was valued at USD 2.1 billion in 2023 and is projected to reach USD 3.2 billion by 2032, registering a CAGR of 5.3% during the forecast period (2024-2032). The market’s growth is expected to be propelled by the rising consumption of the product as a biodiesel feedstock. 

Castor beans are utilized to extract a botanical oil called castor oil. Castor oil possesses a discernible taste and aroma and exhibits a spectrum of hues, ranging from transparent to exceedingly pale yellow. The oil is additionally administered to promote the proliferation of skin and hair. Castor oil is a multifunctional substance extensively used in producing food, pharmaceuticals, cosmetics, polymers and resins, chemicals, lubricants, and other industries. Due to its unique fatty acid composition, Castor oil possesses distinct advantages compared to other vegetable oils such as soybean, coconut, sunflower, and others. Castor oil is extensively utilized in various industries such as automotive, electric, paint and varnish, aerospace, and others because of its inherent, non-toxic, renewable, and modifiable physio-chemical characteristics. 

The utilization of castor oil in the manufacturing of bio-based plastic packaging, lubricants, surface coating, skincare, hair care, and medicinal products, along with the rising demand for the oil in traditional medicines due to its effectiveness in treating skin conditions, constipation, headaches, and inflammatory issues, collectively contribute to the expansion of the castor oil market. Moreover, the extensive use of diverse products has increased demand for raw materials in chemical manufacture and the expansion of end-user industries. This has, therefore, contributed to the overall growth of the castor oil market.

Highlights

• Sebacic acid generates the highest revenue share based on product.
• Plastics and resins influenced the market growth by application.
• Online retail generates the highest revenue share based on the distribution channel.

Market Dynamics

Castor Oil Market Drivers

Growing Demand for Sustainable and Natural Products

The worldwide trend towards sustainability and environmental awareness has resulted in a higher need for natural and eco-friendly products. Consumers are increasingly conscious of the ecological consequences of their purchase choices and are actively searching for sustainable products made with natural components. Due to its natural composition and several advantageous characteristics, there is a significant increase in demand for castor oil, especially in sectors such as cosmetics and pharmaceuticals. Manufacturers are adding castor oil into their formulations to meet the rising demand for sustainable and natural products, leading to increased sales of castor oil and driving market growth.

Increasing Popularity of Castor Oil in Health and Beauty Industries

The multifaceted advantages of castor oil, such as its efficacy in alleviating constipation, hydrating the skin, and stimulating hair growth, have contributed to its widespread acclaim in the healthcare and cosmetic sectors. The increasing awareness among consumers regarding natural and holistic health treatments has led to a significant rise in the demand for castor oil as a natural medicine. The rising awareness has resulted in an uptick in the utilization of castor oil in traditional applications. It has also stimulated creativity in product formulations, resulting in its inclusion in a diverse array of health and cosmetic goods. Revlon introduced a fresh line of hair care products in March 2020. This collection is centered around black castor oil, aloe vera, and vitamins and falls under the ‘Crème of Nature’ brand.

In 2024, Sky Organics introduced castor oil that provides natural care with its USDA Organic certification, 100% pure, and cold-pressed formula. The oil is abundant in Omega fatty acids, which deeply nourish and condition the scalp, roots, and strands. RejuveNaturals offers high-quality castor oil, certified by the USDA Organic, in a 16 oz glass bottle. This composition is a versatile oil that is 100% pure, cold-pressed, and hexane-free. The oil is formulated to preserve the appearance of hair, lashes, and eyebrows in good health.

Consequently, castor oil has become a fundamental component in numerous skincare, haircare, and healthcare products, leading to market expansion and increased prominence in the health and beauty industry. 

Castor Oil Market Restraints

Limited Availability of Castor Seeds

Castor plants exhibit adaptability to various climatic conditions; nonetheless, the cultivation of castor seeds is predominantly focused in select regions, namely India, China, and Brazil. The narrow geographical distribution of castor seed agriculture is a barrier, especially in non-traditional producing areas where access to castor seeds may be limited. The scarcity of castor seeds is expected to affect the worldwide castor oil market substantially. The limited availability of castor seeds can be ascribed to various variables, including volatile weather patterns, infestations by pests and diseases that impact agricultural productivity, and geopolitical challenges that disrupt the distribution networks in crucial castor seed-producing nations such as India and Brazil.

In addition, the limited availability of castor seeds immediately results in decreased production of castor oil, resulting in higher pricing and possible shortages in supply. As a result, enterprises that depend on castor oil may need help in operations, higher expenses, and the necessity to find alternate products or sources. These issues hinder the expansion of the industry.  

Castor Oil Market Opportunity

Rising Demand for Castor Oil as a Sustainable Biofuel

The worldwide movement towards sustainable energy sources has resulted in a substantial rise in the need for biofuels. Castor oil is becoming increasingly important as a raw material for manufacturing biodiesel because it contains a large amount of oil and has a good composition of fatty acids. In June 2023, Casterra Ag Ltd., a subsidiary of Evogene Ltd., entered into a framework agreement to sell seeds of its exclusive castor varieties to a prominent oil and gas company for cultivation in specific African territories. This agreement is expected to impact the castor oil market outlook positively. Through strategic alliances, Casterra, a biotech company located in Rehovot, is projected to enhance its manufacturing output by roughly 400 tons in 2024. These agreements will also involve the establishment of long-term production infrastructures.

Moreover, with the global implementation of laws aimed at promoting biofuels and reducing greenhouse gas emissions, there is an anticipated increase in the demand for castor oil as a feedstock for biodiesel. This represents a substantial market opportunity.

Regional Analysis

The global castor oil market analysis is conducted across North America, Europe, Asia-Pacific, the Middle East and Africa, and Latin America.

Asia-Pacific Dominates the Global Market

Asia-Pacific is the most significant global castor oil market shareholder and is estimated to grow at a CAGR of 5.4% over the forecast period. The demand is attributable to the rise in both consumption and production of the product. Castor seeds are cultivated in the tropical areas of India, Myanmar, Vietnam, Pakistan, Cambodia, Thailand, Bangladesh, Philippines, Indonesia, and the semi-arid parts of China, Japan, and South Korea. While castor seeds were historically cultivated in the untamed regions of Asia Pacific, numerous governments in the area have recently undertaken significant endeavors to cultivate castor seeds on a large scale for commercial purposes. In addition to seeds, castor leaves, stems, and roots are also fundamental.

Additionally, per the Solvent Extractors Association of India, China accounts for approximately 40% of India’s castor oil exports, with Europe following closely at 30-35%. Castor leaves are utilized in China to cultivate silkworms. Castor plant stems produce paper and medium-density boards, while their roots are employed for their medicinal properties. China is the dominant force in the worldwide manufacturing and shipment of sebacic acid, boasting a capacity of over 210,000 metric tons. Due to the large quantity of castor seeds available, India has become a producer and exporter of castor oil and its derivatives, including 12-hydroxy stearic acid, castor wax, dehydrated castor oil, and undecylenic acid.  

Europe is estimated to grow at a CAGR of 5.8% over the forecast period. Market expansion is anticipated to be driven soon by rising usage and favorable government laws regarding bio-based chemicals. In 2021, the European Commission initiated a ‘Green Deal’ to achieve carbon neutrality in the region by 2050. This agreement is supported by regulatory reforms and adopting environmentally friendly technologies in European chemical businesses. Consequently, both manufacturers and consumers in Europe are increasingly favoring bio-based chemicals. Therefore, these government actions are anticipated to drive the demand for oil derivatives in Europe shortly.

North America holds a significant market share. Due to the rising need for bio-based plastics, lubricants, fuel, and cosmetics, North America has become a substantial user of castor oil. The region is experiencing increased demand for biogenic components in the automotive, textile, packaging, paint, and construction industries. Furthermore, the market is anticipated to see expansion due to the rising demand for supplements derived from castor oil, which promote the healthy development of hair and skin.

Segmental Analysis

The global castor oil market is segmented based on product, application, and distribution channels. 

Based on product, the market is divided into 12-HAS, Hydrogenated Castor Oil (Castor Wax), Dehydrated Castor Oil, Sebacic Acid, Ricinoleic Acid, Undecylenic Acid, and Others.

The sebacic acid segment dominated in 2023. The increased market share is related to the expanding utilization of sebacic acid in producing polyamide and resins. The Asia Pacific area, particularly China, is expected to experience a rise in the production of sebacic acid due to the rising demand for this compound in the manufacturing of plastics, biopolymers, and aromatic goods. This increase in demand is also expected to fuel the growth of castor oil production.

The ricinoleic acid segment is the fastest growing. The anticipated expansion is attributed to a surge in demand across diverse end-use sectors, including soap production, ink coating, and textile finishing. Ricinoleic acid undergoes saponification when treated with bases such as ammonia, caustic soda, and ethanolamines, forming soaps. The product is utilized in industrial lubricants, metalworking compounds, emulsifiers, and cutting oils. This substance is used for the production of concentrated liquid soaps with a high solid content, as well as for creating transparent bar soaps.

The dehydrated castor oil segment is the second largest. The increased characteristics and numerous applications of dehydrated castor oil contribute significantly to the growth of the global castor oil market. Due to its rapid drying rate and enhanced film creation capacity, it is commonly used as a favored component in manufacturing paints, varnishes, and coatings. Moreover, its application in producing inks, adhesives, and lubricants enhances market demand. Its diverse applications and environmental benefits primarily drive the market expansion of dehydrated castor oil.

Based on application, the market is divided into Surface Coatings, Cosmetics and Pharmaceuticals, Lubricants, Biodiesel, Plastics and Resins, and Others.

The plastics and resins segment dominated in 2023. The product is extensively employed as a primary substance for producing plastics in contrast to crude oil. Moreover, it serves as a replacement for recovered plastics in the textile sector. Resins derived from castor oil, such as castor oil-modified epoxy and polyamide resin, provide exceptional characteristics, including high-temperature resistance, toughness, flexibility, stiffness, chemical resistance, strong adhesion, and formulation versatility. As a result, castor oil has become a key component in the formulas of epoxy and polyamide resins. 

The cosmetics and pharmaceutical industry is the fastest growing. The surge is attributed to a rise in demand for personal care and cosmetic products, such as soaps, deodorants, body lotions, and skincare products. The product is an addition or excipient in pharmaceuticals to create stable emulsions of nonpolar substances in various aqueous environments. Furthermore, it serves as a vehicle for delivering nonpolar medicines, such as the anticancer medications docetaxel and paclitaxel. The market is expected to be driven by pharmaceutical advancements involving castor oil in new medications.

The lubricant segment is the fastest growing. Lubricants are a crucial factor in driving the growth of the global castor oil market. Castor oil is favored as a raw material for environmentally friendly lubricants due to its distinctive chemical composition, excellent lubricating properties, and ability to break down naturally. The application of this technology extends beyond industrial machinery to the automobile sector, increasing the demand for it. Furthermore, the increasing need for sustainable and renewable resources is driving the growth of the castor oil market. 

Based on distribution channel, the market is segmented into Direct Distribution, Hypermarkets/Supermarkets, Convenience Stores, Traditional Grocery Stores, Pharmacies & Drug Stores, Discount Stores, Specialty Stores, Online Retail, and Others. 

The direct distribution segment dominated in 2023. Direct distribution is the primary method of distributing castor oil and is projected to maintain its dominant position throughout the projection period. The direct distribution channel is the most significant method of distributing castor oil, as various sectors obtain the oil directly from the manufacturers. The expansion of the commercial sector is driving the need for castor oil, thus leading to an increase in direct distribution.

The hypermarkets and supermarkets segment is the fastest growing.  Hypermarkets and supermarkets are essential for expanding the global castor oil industry as they offer wide-reaching distribution networks and direct customer availability. These large retail companies improve the visibility and availability of castor oil products, meeting the increasing customer demand for its various uses, including beauty and industrial applications. Their economies of scale facilitate competitive pricing and promotional activities, enhancing market penetration. 

The specialty store segment is the second largest. Specialty stores play a vital role in expanding the worldwide castor oil market by providing carefully selected, top-notch products explicitly designed for specific consumer segments. These retailers appeal to knowledgeable consumers looking for particular advantages of castor oil, such as organic or cold-pressed options, which are typically not found in regular retail stores. Therefore, the existence and enlargement of specialty stores are crucial for promoting the development and diversification of the worldwide castor oil market.

Recent Developments

• March 2024- Casterra Ag Ltd., a subsidiary of Evogen Ltd. and an integrated solutions company for cultivating castor seeds for bio-based industries, substantially enhanced its production capacities. The company has recently partnered with new and current seed producers in Africa and Brazil to improve its high-yielding castor seed production capacity.
• February 2024- Researchers at the University of Auckland, led by Catherine Jennings, conducted a trial to investigate the possibility of castor oil as a safe and natural treatment for dry-eye conditions. This trial is based on the positive results obtained from a previous pilot study.