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Kava Root Extract Market Size, Share & COVID-19 Impact Analysis, By Product Type (Kava Root Powder Extract, Kava Root Liquid Extract), By End-User (Food & Beverages, Pharmaceutical, and Cosmetics & Personal Care Products), and Regional Forecast, 2022 – 2029

Region : Global | Format: PDF | Report ID: FBI103694

 

KEY MARKET INSIGHTS

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The global kava root extract market size was valued at USD 1.02 billion in 2021. The market is projected to grow from USD 1.18 billion in 2022 to USD 3.41 billion by 2029, exhibiting a CAGR of 16.29% during the forecast period. Based on our analysis, the global market exhibited an average growth of 15.26% in 2020 as compared to 2019. 


Kava or Piper methysticum is a plant belonging to the pepper family and is abundantly grown and consumed in and around the South Pacific islands. Kava is generally consumed in these countries as a ceremonial and traditional drink due to its mild to moderate sedative effects. In some traditions, kava consumption is often similar to that of alcoholic beverages as a socializing drink in other regions due to its kavalactones, dietary fiber, and mineral content.


The popularity of kava root extract, either in liquid or powdered form, is growing, mainly attributable to its relaxing properties and therapeutic effect, which has prompted its utilization in various pharmaceutical and personal care products. It is typically consumed among Western populations either in the form of a capsule or tablet containing ethanolic or acetonic extracts. Kava consumption has witnessed a significant surge in the past few years, especially in North America, owing to its mass consumer appeal as a dietary supplement. The market is anticipated to foresee greater penetration in the untapped markets such as India, Dubai, and China. Additionally, increasing awareness about kava root extract's medicinal and therapeutic benefits is providing a positive impetus to its utilization in various functional food and beverages.


COVID-19 IMPACT


Supply Chain Disruptions and Trade Barriers amid COVID-19 to Negatively Impact Market Growth


The outbreak of the COVID-19 pandemic has had a remarkable impact on the global economy, with its ripple effects being felt across various industries such as food and beverage, pharmaceutical, and agriculture. In response to the coronavirus outbreak, the border closures, security measures, and restrictions on public mobility continue to have prominent effects on the agricultural sector. The major kava-producing countries, such as Fiji and Vanuatu, experienced a rise in infected cases, and falling international demand due to trade barriers had a negative impact on the supply chain. According to the Fijian Competition and Consumer Commission CEO, kava margin prices were affected due to travel restrictions and recent damages from cyclone Harold. Similarly, the prominent kava export destinations, such as Australia and the U.S., could not be reached due to border closures, which led to dwindling local kava supplies and skyrocketing prices. According to the Fijian Uniting Church chairman in Brisbane, kava prices reached USD 500 a kilogram from USD 50 during the period. However, trade restrictions were eased for food and agricultural commodities, which positively impacted the market in the later quarters. The prominent manufacturers in the industry pondered upon unique solutions to cope with the losses by forming alliances with international players, which also contributed to generating higher revenues. For instance, the six-month sales of Fiji Kava Ltd. in 2020 recorded a revenue surge of 111% to reach USD 496,379. Thus, these factors serve as a growth opportunity for the company even post-pandemic. 


LATEST TRENDS


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Growing Popularity of Herbal Extracts-infused Non-Alcoholic Beverages to Aid Growth


Transparency and clean-label have emerged as the key points of consideration for developing new products. In addition, alcoholic beverages are witnessing a slump in their demand as consumers across the globe are gravitating toward non-to-low alcoholic beverages due to their rising health awareness. As individuals seek non-alcoholic beverages infused with health-benefiting ingredients that support their active lifestyles, it positively impacts the kava root extract consumption trends. Furthermore, to cater to the consumers evolving demands, the manufacturers are introducing non-alcoholic beverages infused with herbal extracts offering anxiety and stress relief. For instance, in October 2021, Branded Legacy, Inc., a manufacturer of hemp and cannabinoid-infused beverages, signed a distribution agreement with Sacred Leaf Shops to establish a kava bar serving kava-infused beverages. Kava root extract-infused beverages demand has also surged due to its relaxing and euphoric effect similar to alcohol, thereby rapidly emerging as an alternative to alcoholic beverages.


DRIVING FACTORS


Rising Incorporation of Kava Root Extract in Pharmaceutical Industry to Favor Market


Increasing health and wellness trends among consumers have prominently driven the kava root extract market growth. Due to numerous attributable health benefits of kava, its application across the pharmaceutical sector for manufacturing medicinal consumables is rising. The ingredient is largely viewed as a herbal supplement with calming effects that help individuals manage their stress and anxiety issues. There has been a worldwide shift toward traditional medicine from synthetic medicines as they are considered to be safer. Furthermore, herbal and traditional medicines are still the mainstay of nearly 75-80% of the global population, especially in developing countries, due to the general belief that herbal drugs have no side effects apart from being cheap and locally available. Thus, the product has been reported to be gaining popularity as a nutraceutical ingredient among pharmaceutical product manufacturers and health-conscious individuals.


Rapidly Expanding Supplements Industry to Augment Growth


A healthy lifestyle has proven to be associated with having an ideal amount of sleep, exercise, and food choices. This also helps keep the risk of life-threatening diseases at bay, thus influencing the consumers' worldwide demand for dietary supplements to support their overall wellbeing. Supplement manufacturers are eyeing regions with a growing geriatric population with heightened adult usage of dietary supplements to cater to their nutritional needs. Furthermore, the rising functional food consumption trends have nudged the industry players to incorporate kava in functional foods and beverages. For instance, Whole Foods Market IP, Inc., a multinational supermarket chain, 2017 listed kava in the top 10 trending ingredients to look out for due to its soothing benefits. Thus, these factors cumulatively aid in fueling market performance.


RESTRAINING FACTORS


Low Market Penetration and Fluctuations in Raw Material Trade and Price to Hinder Market Performance


Kava root extract-based products are widely popular across the Pacific Islands region and gaining traction among the consumers in developed economies such as the U.S., Canada, Australia, and New Zealand, but not so much in developing economies of the Middle East and Asia. The psychoactive properties of kava have gained it a negative reputation as a drug, hindering its market performance. Furthermore, at times its consumption is often associated with liver ailments, which further hampers its trade regulations. For instance, in March 2002, the U.S. Food and Drug Administration (FDA) warned health professionals and consumers about the liver damage risk associated with kava consumption. Moreover, kava cultivation is affected by various climatic aberrations such as a cyclone or flood, which directly impacts the raw material trade and prices. For instance, in 2020, Cyclone Harold hit Vanuatu, which disrupted the kava crop cultivation and exports, leading its main export destinations, such as Australia, to experience a price surge.


SEGMENTATION


By Product Type Analysis


Kava Root Powder Extract to Account for Larger Share due to its Wide Availability


By product type, the market is divided into kava root extract liquid and powder.


Kava root powder extract held the major kava root extract market share owing to wide availability and ease of utilization. It’s often consumed in the form of tea by steeping it for some time in hot water. Its popularity is growing among individuals as an alternative to regular tea due to its euphoric effects and lack of caffeine which helps them cope with stressful conditions. Wider use of the powder variant in the personal care and dietary supplements sector influences the segment’s growth.


Meanwhile, the liquid extract segment is anticipated to witness growth, owing to its growing incorporation in beverages and food products to enhance its nutritional value. Even small doses of liquid extract or tincture are sufficient for maintaining homeostasis in various systems in the body.


By End-User Analysis


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Food and Beverage Segment to Dominate Owing to its Consumption as Ceremonial Drink


By end-user, the market is bifurcated into food & beverages, pharmaceutical, cosmetics & personal care, with the food and beverage segment accounting for the lion’s share. The food and beverage industry focuses on continuous improvement and development of unique, clean-label, plant-based extracts that also support their overall health. Botanical extracts have increasingly been incorporated across all major segments, such as beverages, bakery products, and condiments. As consumers incline toward flavored or infused water that offers unique sensory appealing characteristics and provides natural declaration, it contributes to driving the segment’s growth. Additionally, the extensively growing research for effective and prompt extraction of kava extracts from the roots supports the market performance. For instance, researchers at MIT have figured out a cutting-edge technology for synthesizing the feel-good molecules from kava by engineering the clone key genes in bacteria, which speeds-up the mass production.


The pharmaceuticals sector is likely to observe tremendous growth opportunities in the upcoming years due to the rising consumer demand for herbal medicines. Further, there has been a substantial rise in research on the effectiveness of kava in treating various health ailments ranging from neurological disorders and cancer. Historically, kava has been used to treat urinary tract infections and asthma, which showcases the huge growth potential of this market in the pharmaceutical sector.


REGIONAL INSIGHTS


The market has been categorized into Fiji, Vanuatu, U.S., Tonga, Australia, New Zealand, and the Rest of the World in terms of geography.


Fiji dominated the market in terms of sales and stood at USD 560.85 million in 2021. The country is one of the prominent producers and consumers of kava root extract and other products. It has been traditionally consumed as a ceremonial drink and during social gatherings in Fiji. The country is also amongst the largest exporters of kava roots globally and is regarded as one of the most important cash crops. According to the Pacific Horticultural and Agricultural Market Access Plus Program (PHAMA), an organization that provides targeted and practical solutions to Pacific Island countries for exporting commodities mentioned in 2020, Fiji kava exports stood at 478 metric tonnes. However, a large proportion of the kava produced in Fiji is domestically consumed and traded in domestic markets. Furthermore, besides the kava drinks being served across the bars in the country, the private sector is pondering upon kava anti-anxiety medicines and kava nurseries to promote its consumption and plantation in Fiji. These initiatives directly involve the rural populations that attract established farmers and unemployed rural individuals, which is further projected to boost the regional outlook of this market.


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Vanuatu is likely to exhibit significant growth opportunities for the market due to the growing demand for nutritional supplements to support overall health. Further, the kava industry is arguably one of the prominent industries in the country due to its huge contribution to the country’s GDP as a cash crop. The consumption of kava drinks in the country has gradually surged over the years due to rising population, urbanization, and rise in women kava drinkers. In addition, the utilization of these extract in traditional medicines due to its anti-inflammatory and sedative effects is expected to further drive the market growth. Moreover, according to the latest trade statistics published by the National Population & Housing Census, 2020, the total kava export value stood at around USD 26.28, and its export values increased by 98% between the years 2017-18, attributable to the price increase, lower supply, and increased global demands. The rise in demand for these extract-based products is mostly based on evolving consumption patterns in developed countries such as the U.S., along with new and relaxed guidelines on trade policies and dietary guidelines related to the kava industry.


KEY INDUSTRY PLAYERS


Extensive Focus of Prominent Players on Introducing Innovative Products to Drive Growth


The significant rise in lifestyle problems faced by individuals worldwide due to their hectic and busy schedules is probable to increase the demand for high-quality and potent herbal extracts at a robust pace. The changing preferences of the consumers have influenced the manufacturers to come up with unique products to diversify their product range and, at the same time, cater to the shifting demands. The market appears to be highly fragmented due to the presence of numerous small and large players. Development of new products, coupled with partnerships are some of the key strategies espoused by the players to compete in the global market. For instance, in August 2020, Fiji Kava, an Australian-Fijian medicinal kava health and wellness company partnered with Pumate Shanghai as its distributor of kava extracts to effectively penetrate the Chinese vitamins and supplements market. Some other key players in the industry are Botanic Healthcare, NOW Health Group, Inc., Gaia Herbs, Inc., Root of Happiness, and LifeSeasons, Inc.


LIST OF KEY COMPANIES PROFILED:



KEY INDUSTRY DEVELOPMENTS:



  • March 2022 – Urban Outfitters, Inc., a lifestyle retail corporation based in the U.S. and Psychedelic Water Inc., established a partnership and launched a visionary brand called the Psychedelic Water across 130 stores in the U.S. The product is formulated using organic and sustainably sourced kava root, green tea leaf, and damiana leaf extracts, offering euphoria with a hangover-free experience.

  • March 2021 - Ohana Kava Bar, a Colorado-based kava bar, started selling its products online for the large number of individuals to have access to this health-promoting herbal extract. The product is available in instant kava, liquid kava extract, and kava extract capsule variants.


Report Coverage


An Infographic Representation of Kava Root Extract market

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The global kava root extract market report provides qualitative and quantitative insights into the market. It also offers a detailed analysis of its product type and end-users, market size, and growth rate for all segments in the market. In addition, the report provides an elaborative analysis of the competitive landscape and market dynamics. Different key insights presented in the research report are an overview of related markets, market segmentation, research methodology, company profiles, and recent industry developments. Along with this, information about mergers & acquisitions, the regulatory scenario in critical countries, and key industry trends are also provided in the report.


Report Scope & Segmentation














































  ATTRIBUTE



  DETAILS



Study Period



2018-2029



Base Year



2021



Estimated Year



2022



Forecast Period



2022-2029



Historical Period



2018-2020



Unit



Value (USD million)



By Product Type




  • Kava Root Powder Extract

  • Kava Root Liquid Extract



By End-User




  • Food & Beverage

  • Pharmaceuticals

  • Cosmetics and Personal Care Products



By Country




  • Fiji (By Product Type and End-User)

  • Vanuatu (By Product Type and End-User)

  • U.S. (By Product Type and End-User)

  • Tonga (By Product Type and End-User)

  • Australia (By Product Type and End-User)

  • New Zealand (By Product Type and End-User)

  • Rest of the World (By Product Type and End-User)



Frequently Asked Questions

Fortune Business Insights says that the market was valued at USD 1.02 billion in 2021 and is probable to reach USD 3.41 billion by 2029.

Growing at a CAGR of 16.29% the market will exhibit significant growth in the forecast period (2022-2029).

Kava root powder extract segment is expected to be leading among the product types in the global market during the forecast period.

The growing incorporation of the product in various cosmetics and pharmaceutical products due to its health benefits is fueling the market growth.

Botanic Healthcare, NOW Health Group, Inc., Gaia Herbs, Inc., and Root of Happiness are a few of the key players in the market.

Fiji is expected to hold the highest market share.

The food & beverage segment is anticipated to grow at the fastest pace during the forecast period.

The rising product adoption in the pharmaceutical sector is becoming increasingly popular across the globe.

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