Orange Extract Market

Market Overview

The global orange extract market size was valued at USD 655.7 million in 2022 and is projected to reach USD 1,136.4 million by 2031, registering a CAGR of 6.3% during the forecast period (2023-2031). With increased knowledge of the health benefits of orange extract and increased demand from the food and beverage industry, the orange extract market share has increased significantly.

Orange extract is a concentrated liquid from oranges that captures the fruit's flavor and aroma. It is widely used as a flavoring agent in various culinary applications such as baking, cooking, and beverage production. The extraction process typically involves extracting essential oils from orange peels or drawing out flavor compounds with a solvent. The increasing demand for orange extracts from flavoring is the critical element driving the growth of the orange extract market. Furthermore, the rapidly expanding food and beverage industry will likely drive demand for orange extracts in the future. Farmers of oranges have several obstacles, particularly in developing countries. Farmers need more storage facilities near the production site, a shortage of packaging, and the absence of a processing plant.

Furthermore, orange output decreases due to a need for an adequate irrigation system. Again, organic orange farmers need help with commerce, certification, and selling their organic oranges. All of these issues cause farmers to incur additional expenditures, and as a result, orange extract manufacturers need help marketing raw material price variations. As a result, shifting raw material prices may impede the volume of orange extracts and increase prices. This could slow market growth during the predicted period.

Highlights

• Liquid commands a sizeable revenue share of the market by form.
• Conventional occupies a significant market share based on Nature.
• Food and beverages are the major end-users of the market.
• Specialty Stores are a significant contributor to the market based on distribution channels.
• North America dominates the global market.

Market Dynamics

Global Orange Extract Market Drivers:

Expanding Food and Beverage Industries

The global food and beverage industry's ongoing expansion is a significant driver for the orange extract market. As the industry grows, there is a greater demand for flavoring agents, and orange extract is widely used in various product categories. Orange extract is commonly used in baking to flavor cakes, cookies, pastries, and other sweet treats. Its citrus notes complement the flavor of baked goods, providing a distinct and natural flavor. Orange extract, for example, can be used as a critical ingredient in orange-flavored cupcakes, muffins, or citrus-infused chocolates.

Additionally, the food and beverage industry has a sizable market. Statista states that global food and beverage retail sales will exceed USD 7.7 trillion in 2020. This figure reflects the industry's broad scope and the diverse range of products that use flavoring agents such as orange extract. Orange extract is used in various products as the food and beverage industry grows, including snacks, desserts, beverages, and sauces. It is a popular choice among food and beverage manufacturers looking to meet consumer preferences for authentic and appealing tastes because of its ability to contribute a natural and vibrant citrus flavor. Furthermore, the orange extract market trend toward clean-label and natural ingredients in the food and beverage industries increases demand for natural flavorings such as orange extract. Consumers are increasingly looking for products with simple and recognizable ingredient lists that align with using natural extracts in formulations.

Global Orange Extract Market Restraints:

Seasonal Variability and Agriculture Dependency 

The Seasonal Nature of orange cultivation heavily influences orange extract production. Oranges have distinct harvest seasons; weather conditions such as temperature and rainfall can impact the fruit's quantity and quality. This seasonality introduces difficulties in ensuring a consistent and year-round supply of oranges for extraction, potentially disrupting the orange extract market. Oranges are in season from autumn to spring, but the specific months vary depending on the variety. Navel oranges, for example, are best from December to March, blood oranges from December to April, and clementines and tangerines from late October to January. Furthermore, the best oranges are available from November to April.

Moreover, citrus fruits, including oranges, are subject to natural climate and weather constraints, according to the United Nations Food and Agriculture Organization (FAO). Frost and extreme temperatures during flowering or fruit development stages can cause citrus crop damage, affecting harvests. As a result, seasonal variability makes it challenging to maintain a consistent supply of oranges for extraction throughout the year. This can cause fluctuations in the market availability of orange extract, influencing both pricing and manufacturers' ability to meet consumer demand consistently.

Global Orange Extract Market Opportunity:

Expansion of Functional Foods and Nutraceuticals

The growing emphasis on health and wellness has increased demand for functional foods and nutraceuticals—products that provide health benefits in addition to essential nutrition. Orange extract is high in natural compounds and antioxidants, and it has the potential to be incorporated into these products, aligning with the growing interest in nutritionally enhanced food and beverage options. Club and studio owners are optimistic about the fitness industry's future, according to a 2023 IHRSA Global Report. According to a survey, 80% of respondents expect membership and revenue to increase by more than 5% in 2023. likewise, according to a 2023 Food and Health Survey, 41% of Boomers follow an eating pattern or diet, up from 29% in 2022. The most common eating patterns are high-protein, mindful, calorie counting, clean eating, and intermittent fasting.

As a result, orange extract can be used to create nutraceuticals such as dietary supplements, vitamin-enhanced products, and functional beverages. For example, a company may launch an antioxidant-rich vitamin C supplement derived from orange extract to support the immune system and overall health. Manufacturers interested in capitalizing on this opportunity may form alliances with nutraceutical companies to develop products combining orange extract's health benefits with other functional ingredients. Collaboration with nutritionists and health professionals can provide insights into creating products that address specific health and wellness trends.

Regional Analysis

The global orange extract market analysis is conducted in North America, Europe, Asia-Pacific, the Middle East and Africa, and Latin America.

North America Dominates the Global Market

North America is the most significant global orange extract market shareholder and is estimated to grow at a CAGR of 6.4% over the forecast period. This region's growth is due to the presence of countries such as the United States, the second-largest global orange producer, accounting for 10% of global production, in the North American region. Orange-flavored carbonated soft drinks are trendy. The widespread use of orange extracts in everything from sorbet to flavored sparkling water is fueling the growth of the Orange Extract Market in North America.

Asia-Pacific is anticipated to exhibit a CAGR of 6.6% over the forecast period. This expansion is due to factors such as the presence of countries such as China, the third-largest orange producer in the Asia-Pacific region. Orange-flavored carbonated soft drinks are well-known among consumers. The increasing use of orange extracts in food and beverages and for cosmetic purposes is fueling the growth of the Asia-Pacific orange extract market. China is the world's largest citrus fruit producer, accounting for 28.66% of total production in 2021. China produced 46.7 million tonnes of citrus fruit in 2021, an increase of 10.16% from 1972. China's orange production is expected to increase to 7.6 million metric tons in 2022-2023, up from 7.55 million metric tons the previous year. This is due to increased production in new planting areas offsetting decreases in Jiangxi province's navel orange production.

Latin America's climatic conditions favor citrus cultivation, and several countries are well-known for their orange production. Brazil, in particular, dominates the global orange market. Latin America is a major producer of oranges worldwide. Brazil is the world's leading orange producer, accounting for 30% of global output. Brazil produced over 35.7 billion pounds of oranges in 2021, accounting for more than 21% of the world's orange production. 

Europe's orange extract market has a moderate market share due to the region's expanding food and beverage industry. Furthermore, the German orange extract market had the largest market share, and the U.K. was the European region's fastest-growing market. Europe is one of the largest markets for bakery products, with Germany, France, the United Kingdom, and Italy leading the way. Despite being a citric fruit producer, Europe imports approximately 40% of South Africa's total citric fruit production due to increased demand for citrus extracts as a natural flavoring solid agent in bakery items while adding nutritional value to the bakery products.

Segmental Analysis

The global orange extract market is segmented based on form, Nature, end-user, distribution channel, and region.

The market is further segmented by form into Powder and liquid.

Liquid commands a sizeable revenue share of the market.

Liquid

The liquid segment accounted for the most significant global market share, owing to the increasing use of liquid orange extracts in the food and beverage industry. Liquid orange extract is a concentrated form of the natural essence extracted from oranges preserved in liquid form. This format is popular because it is simple to incorporate into liquid-based recipes such as beverages, sauces, dressings, and desserts. Liquid orange extract provides quick and even flavor distribution throughout the product, ensuring a consistent taste profile. It is frequently preferred in applications where the liquid consistency allows for better blending and dispersion. Liquid orange extract is a versatile ingredient for commercial and home use, allowing for precise flavor enhancement in various culinary and beverage creations.

Powder

Powdered orange extract is a concentrated and dehydrated form of natural orange extract. This format is versatile in application because it can be easily incorporated into dry mixes, baking recipes, beverages, and nutritional supplements. The dehydration process helps to extend shelf life while retaining the distinctive flavor and aroma of oranges. Powdered orange extract is a convenient and easily measurable option for food and beverage manufacturers and consumers, allowing for precise control over the intensity of orange flavor in various products.

Based on Nature, the market is sub-segmented into Organic and conventional.

Conventional occupies a significant market share.

Conventional

The conventional segment accounted for the most significant global market share, as conventionally produced oranges ensure a high yield to farmers and generate substantial revenue. Orange extract derived from conventionally grown oranges, where standard agricultural practices may include synthetic pesticides and fertilizers, is included in the conventional segment. Conventional orange extract is produced using traditional methods that do not adhere to stringent organic farming guidelines. This segment caters to a broader market, including consumers who value affordability and accessibility. 

Organic

The organic market refers to orange extract made from organically grown oranges. The oranges used in organic orange extract production are grown without synthetic pesticides, herbicides, or genetically modified organisms (GMOs). The extraction and processing methods are organic, resulting in a product free of synthetic chemicals. Organic orange extract caters to consumers seeking natural and environmentally friendly options, aligning with sustainable agriculture principles and focusing on biodiversity promotion.

Based on end-users, the market is fragmented into Food and Beverages, Cosmetics, and Pharmaceuticals.

Food and beverages are the major end-users of the market.

Food and Beverages

The food and beverage segment held the most significant global market share, as orange extracts are used in various food and beverage products such as desserts, soft drinks, confectionary food items, and ice cream. End-users in the culinary and beverage industries who use orange extract as a flavoring agent make up the food and beverages segment. The orange extract improves the flavor and aroma of various foods, including baked goods, confectionery, beverages, sauces, dressings, and more. 

Cosmetics

Orange extract is used to formulate beauty and skincare products in the cosmetics industry. Orange extract's aromatic and refreshing properties make it a desirable ingredient in perfumes, lotions, creams, and other cosmetic items. The natural essence of oranges contributes to a pleasant fragrance, and the extract may have skin benefits. Orange extract cosmetics align with consumer preferences for natural and botanical-based ingredients in personal care and beauty products.

The market can be further bifurcated by distribution channels into Supermarkets/Hypermarkets, Convenience Stores, Specialty Stores, and Online Sales Channels.

Specialty Stores are a significant contributor to the market.

Specialty Stores

The specialty stores segment held the most significant share of the global market. Specialty stores specialize in specific product categories, such as gourmet food stores, culinary supply shops, or stores specializing in natural and organic products, such as orange extract. Consumers with a specific interest in high-quality or unique varieties of orange extract are served by the specialty store distribution channel. These stores may offer a curated selection, providing a premium shopping experience for those looking for specialized and unique options.

Supermarket/Hypermarket

Orange extract is sold in large-scale retail establishments via the supermarket/hypermarket distribution channel. Orange extract products can be found on the shelves of supermarkets and hypermarkets, where various brands and varieties are available. These retail locations provide customers with a convenient one-stop shopping experience, allowing them to explore and purchase orange extract alongside other grocery items.

Recent Developments

• August 2023- Döhler Group acquired Boon Flavors in Thailand to expand its Southeast Asian presence.
• December 2023- Kerry acquired the Lactase Enzymes Company.