Herbal Medicine Market Size, Share & COVID-19 Impact Analysis, By Application (Pharmaceutical & Nutraceutical, Food & Beverages, and Personal Care & Beauty Products), Form (Powder, Liquid & Gel, and Tablets & Capsules), and Regional Forecast, 2021-2028

The global herbal medicine market size was USD 185.86 billion in 2020 and is projected to grow from USD 230.03 billion in 2021 to USD 430.05 billion in 2028 at a CAGR of 11.32% during the 2021-2028 period. The global impact of COVID-19 has been unprecedented and staggering, with herbal medicines witnessing a neutral impact on demand across all regions amid the pandemic. Based on our analysis, the global market exhibited a higher growth of 8.54% in 2020 as compared to the average year-on-year growth during 2017-2019. The rise in CAGR is attributable to this market’s demand and growth, returning to pre-pandemic levels once the pandemic is over. The rise in CAGR is majorly due to increasing demand for herbal and natural ingredients from cosmetics as well as nutraceutical industries.

Herbal medicines are naturally obtained medicines that are used for health and skin. In Asia, Ayurveda and ancient Chinese medicines are mainly used as herbal medicines in various industry applications.

Increased Health Concerns amid COVID-19 Pandemic Helped Market Prosper

The COVID-19 disease was declared as a global pandemic by the WHO in March 2020. The pandemic had major impacts on the health and pharmaceutical sectors, which may prevail in the short and long-term period. There are also short and long-term negative impacts on R&D and manufacturing activities, as well as delay in projects/programs not related to the core supply chain/data management operations.

On a global level, the impact of medicine shortage varied for retail sale and in hospital medicines sale. According to DARU Journal of Pharmaceutical Sciences, there was around 100 to 700% increase in medicines used in hospitals for COVID-19, including sedatives, respiratory treatments, and pain treatments from January 2020. While the whole impact of the global pandemic is still unknown, pharma companies are responding and are trying to recover the lost revenue. COVID-19 being a novel disease, the lack of specific medicine for its treatment has increased consumer focus on improving immunity.

In Asian countries where herbs are easily available, consumers shifted their focus to raw herbs as well as locally manufactured medicines to increase immunity. Medicines and dietary supplements having herbal tea, turmeric, coriander, cumin, and garlic as their vital ingredient was sold extensively considering the benefit they offer to suppress the attack of the COVID-19 virus on the body. Hence, although the supply chain was disrupted in the first quarter of 2020, with the availability of ample amount of herbs in storage and the presence of local manufacturers, the global market saw the average growth rate during this time.

LATEST TRENDS

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Heightened Consumption of Herbal Dietary Supplements

The use of alternatives for antibiotic medicines, such as herbal products, is increasing since the last decade. Herbal products are gaining popularity among patients as well as health care professionals. According to WHO, almost 10-50% of the population in developed countries use herbal products regularly in some form. The major reason for using herbal products is their better immunity power compared to synthetic drugs. In developing countries, such as China, Japan, India, Vietnam, South Africa, and Bangladesh, herbal medicines are only affordable and available treatment option sometimes. Consumers mainly opt for these medicines for cough and cold, nervous, gastrointestinal sickness, and painful conditions such as joint pain, rheumatic diseases, and stiffness. This ongoing trend of consuming herbal supplements is expected to offer promising opportunities for the market growth.

DRIVING FACTORS

Increasing Demand for Herbal Ingredients in Cosmetic Industry Driving Market Growth

The cosmetics industry presents good opportunities for exporters of natural ingredients from developing countries to expand their businesses in developed regions. The demand is increasing for natural ingredients from the cosmetics sector. The major factors that are driving this demand are the growing consumer awareness about natural cosmetics and the growing focus among cosmetics companies to provide natural herbal alternatives to synthetic ingredients. As the demand for natural ingredients used in cosmetics and toiletries products is growing, this trend is expected to continue during the forecast period. Cosmetic product manufacturers are replacing synthetic chemicals with natural ingredients. This is mainly to adhere with the consumer demand and also in a shift towards sustainable raw materials. Consumer demand for personal care, beauty products, and toiletries products that avoid chemicals is expected to help fuel market growth.

Moreover, robust demand for natural ingredients is expected to provide opportunities for potential suppliers in developing countries. Skincare is the most popular product category, in which a wide range of products uses natural ingredients. Commonly used herbal natural ingredients include vegetable oils that have functional properties and are beneficial for body and face. Various plant-based extracts are used for their functional properties. For instance, essential oils are mainly used as fragrances. With the extensive use of herbal ingredients in the cosmetic industry, this factor is expected to prove a major driver for this Market.

High Demand for Natural Herbal Medicines from Developing Countries Offers Promising Opportunities

Herbal medicines are a vital part of medical treatment in many developing countries. Herbal products and natural preparations are used for almost all minor ailments. In developing as well as lower-income countries, visits to trained doctors or prescription pharmacists are usually rare and considered reserved for life-threatening disorders. In developing countries, herbs used for medicinal purposes are unprocessed herbs--plants or plant parts, dried and used in whole or cut form. Herbs are prepared as teas (sometimes as pills or capsules) for internal use and as salves and poultices for external use. As a majority of the developing countries have minimal regulation related to the use of herbs as medicines, the expansion of the industry in developing countries is expected to prove as one of the driving factors for the herbal medicine market analysis.  

RESTRAINING FACTORS

Strict Guidelines Related to Use of Herbal Medicines as Raw Material in Cosmetic Industry to Restrain Market Growth

There are different guidelines and regulations for herbal and natural products’ imports and their use in every country. According to WHO, many countries have a lack of political will, a legal framework, capacity to monitor the safety of the product and their practice, referral mechanisms between herbal and conventional medical practitioners, information systems, and analysis of herbal ingredients, and integration of herbal products into health systems. Owing to the above mentioned reasons, herbal products suppliers and manufacturers face obstacles when they try to gain access to different markets of the product. The manufacturers or suppliers are also need to follow various legislations and accept different requirements and diverse standards.

Similarly, for the same products, pharmaceutical companies have to develop different dossiers to present them to different national authorities. International communication within the scientific community and regulators is necessary to develop appropriate regulatory environments for herbal and traditional medicines. This factor may prove as a major restraining factor for the global market growth.

SEGMENTATION

By Application Analysis

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Pharmaceutical & Nutraceutical Segment Holds the Major Market Share Owing to Increasing Demand for Herbal Products

By application, the pharmaceutical & nutraceutical segment holds the largest herbal medicine market share. This is attributed to the high demand for herbal raw materials from dietary supplement manufacturers and the alternative medicines industry. Consumers are shifting their focus from synthetic medicines to herbal medicines after knowing the long-term benefits offered by herbal products. Dietary supplements such as herbal protein powders and anti-aging products are popular product categories in the nutraceutical industry. Increasing demand for herbal products from these industries is expected to sustain for the long term and this factor will keep the dominance of the pharmaceutical & nutraceutical segment in the global market during the forecast period. The personal care & beauty products segment holds the second highest market share of the market. A major reason for the increased demand for herbal raw materials in the cosmetic industry is their long-term benefits for hair, face, and skin. As the awareness about the prolonged benefits related to the product is increasing, the sales volume of herbal cosmetic products is also increasing. The food & beverage industry is a comparatively new industry that is adapting to the product. Key food manufacturers are entering the market with herbal flavored drinks, juices, milk products to give customers alternatives to the conventional drinks. With innovative product launches in upcoming years, this segment is expected to grow with the highest CAGR during the forecast period.

By Form Analysis

Tablets & Capsules Market to Hold Major Share Owing to its Wide Availability in Global Pharmaceutical Industry

The tablets & capsules segment holds the major market share of the global market based on form. Several such medicines are available in the form of capsules and tablets in the market. Also, there is an increasing number of prescriptions mentioning the consumption of herbal capsules and tablets. With an increasing number of herbal products in the pharmaceutical industry, this segment is expected to remain dominant on the global market during the forecast period.

The liquid & gel segment accounts for the second-highest market share of the market based on form. Liquid and gel products are present in the pharmaceutical, nutraceutical, and food & beverages industries. Several market players are launching herbal drinks, turmeric drinks, in the liquid category. Moreover, several syrups are made by herbal products and can be used to cure cough and normal colds. With the presence of several products in this category, this segment is expected to grow with a considerable CAGR. Powder form products are usually the protein powders that fall in the nutraceutical industry. With the growing demand for herbal protein powders from the millennial population to aging population, this segment is expected to grow with the highest CAGR during the forecast period.  

REGIONAL INSIGHTS

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Europe has the largest cosmetics market in the world and is expected to present good opportunities for new entrants in the market from developing countries. Demand for natural ingredients used in the personal care and beauty products segment is growing simultaneously and this trend is expected to continue. Adhering to this demand from European countries, Europe is expected to contribute to the growth of market considerably in the future. Turmeric is becoming a popular ingredient in the European health products market. It is known for its antioxidant and anti-inflammatory properties and hence, it is used as a supplement and in medical products to boost the immune and digestive systems and overall health. Most turmeric imported into the EU comes from India, but other source countries include Thailand, Madagascar, Peru, and Sri Lanka. A major driver for the demand for turmeric is the increasing lifespan of the European population. Rising health consciousness among the European population will drive the regional growth. The popularity of ethnic cuisine in the region makes turmeric a popular spice.

In North America, there is a growing awareness among consumers mainly in the U.S. about health and there is a shift in the attitude of the people towards nature care products due to a powerful green wave. This is because of the perceived pernicious effects on the health of individuals of the alternative medicines. This factor has helped the product to make an impact in the U.S market.

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The cosmetics markets in Asia and Latin America are also showing significant growth. With increasing internet usage, consumers are getting aware of the prolonged benefits related to herbal products and are keen on using natural & herbal products. Moreover, increasing disposable income in developing countries, such as India, China, Brazil, and countries in Southeast Asia, has been sustaining growth in these markets. South Africa, UAE, Qatar, Saudi Arabia, Kenya, and Nigeria are some of the developing countries in the Middle East & Africa region and are among some of the major emerging economies in the world. With the increasing financial stability of the families in these countries, they are expected to spend more on cosmetic products and this factor is expected to play a vital role in the growth of the herbal medicines industry in this region.

KEY INDUSTRY PLAYERS

Patanjali Ayurved Taking Notable Efforts to Capture Indian Herbal Medicine Market

Patanjali Ayurved is one of India’s major players in this Market. The majority of its products are made from naturally sourced herbal raw materials. It is trying very hard to capture the Indian market and is expected to do so in the coming years. Patanjali’s sales volumes grew 7% in October-March 2018 and 22% in April-September 2017. Patanjali has been the biggest disruptor in the FMCG space. As the brand is established and consistently growing, in terms of both shares and retail shelves. Patanjali’s exponential growth is mainly driven by the novelty factor. In the initial years, toothpaste and honey were the only two categories in which Patanjali mainly expanded its market share, later it started to expand in herbal soaps and edible oil categories. With such expansion plans, Patanjali is looking forward to making its mark in the Indian industry.

LIST OF KEY COMPANIES PROFILED:

• KPC Products Inc. (California, U.S.)


• NEXIRA (Normandy, France)


• HISHIMO PHARMACEUTICALS (Rajasthan, India)


• Schaper & Brümmer GmbH & Co. KG (Salzgitter, Germany)


• Sydler Group of Companies (India)


• 21^ST Century HealthCare, Inc. (Arizona, U.S.)


• Zoic Pharmaceuticals (Punjab, India)


• Herbally Yours, Inc. (Arizona, U.S.)


• Pharma Nord B.V. (Vejle, Denmark)


• NATURLAND (Gräfelfing, Germany)

KEY INDUSTRY DEVELOPMENTS:

• November 2020 –Kunnath Pharmaceuticals, the maker of an Herbal product from India launched antiviral immunity booster capsules under the brand name 'Viromune' across India. Through this launch, the company is looking to achieve a turnover of USD 266 Million in the next three years.


• March 2021 –Lotus which is one of India's popular beauty companies launched the Lotus Botanicals brand. Through this e-commerce brand, consumers will be able to order Lotus Botanicals' range of skin and hair care products only through Lotus Botanicals and other third-party eCom channels.

REPORT COVERAGE

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The global market research report provides a detailed analysis of the market and focuses on key aspects such as leading companies, types, and leading forms of the product. Besides this, the report offers insights into the market trends and highlights key industry developments. In addition to the aforementioned factors, the report encompasses several factors that have contributed to the growth of the market over recent years.

Report Scope & Segmentation: