GCC Flavours and Fragrances Market Report and Forecast 2024-2032

GCC Flavours and Fragrances Market Outlook

The GCC flavours and fragrances market size attained about USD 560.6 million in 2023. The market is further expected to grow at a CAGR of 4.3% during the forecast period of 2024-2032 to reach approximately USD 805.6 million by 2032.

Key Takeaways

• Global fast-food chains, such as McDonald's Corporation, Herfy, and Kentucky Fried Chicken are widely popular in the region.

• The region boasts an array of high-end, luxury perfume boutiques.

• Natural flavours and fragrances are demanded as healthier alternatives to artificial ingredients.

The incorporation of techniques such as mass spectrometry, gas chromatography, and sensory evaluation helps flavourists and perfumers conduct efficient fragrance and flavour analysis. The analysis of the flavour and fragrance profiles of end products helps manufacturers meet the changing consumer demand.

The GCC flavours and fragrances market development is driven by various factors, such as demand for luxury perfumes, natural ingredients in food and cosmetic products, an expanding foodservice sector, and the presence of numerous perfume manufacturers.

Some of the key trends are consumer demand for cruelty-free products and sustainable ingredients, a growing market for fast food products, rising per capita income, busy consumer schedules, and rising tourist footfall. These factors are collectively influencing the GCC flavours and fragrances market growth.

Key Trends and Developments

Rising demand for food flavourings food, increased adoption of natural cosmetic products, and growing interest in luxury fragrances are creating several opportunities in the GCC flavours and fragrances market

Figure: Retail Value of Top 5 Cosmetics and Personal Care Categories in GCC (2022); USD Billion

Key Insights:

• The majority of beauty categories are dominated by female consumers, who spend 55% more on an average than male consumers. Makeup and fragrances account for the largest portion of spending.

• In the fragrance segment, men often spend 12% more than women. On an average, women spend USD 74 per month on fragrance, while men spend USD 83 per month.

• A major trend in the GCC beauty sector is the growing demand for sustainability. The demand for clean and environmentally friendly beauty products in the GCC is rising. By 2025, the region’s clean beauty market is expected to be worth USD 2.6 billion.

• Gen Z, who make up about 15% of the Middle Eastern population is driving the sustainability trend owing to the influence of social media and rising environmental and health awareness.

• The growing consumer demand for environmental responsibility and personal well-being has resulted in vegan and cruelty-free cosmetics produced using natural plant-based ingredients.

Figure: Trends in Food Service Sector in the GCC region

• In 2022, the estimated revenue from the food service sector in Saudi Arabia was close to USD 25 billion. This revenue is projected to grow by over USD 45 billion by 2030.

• The GCC food sector has enormous potential for expansion and innovation. The region is witnessing growing demand for healthier and sustainable options.

• GCC’s food retail sector is expected to grow at a CAGR of 3.8% between 2020 and 2025. The growth is driven by growing tourist footfalls and population growth.

• With the rise of online reservations and meal delivery applications, the food service sector is experiencing positive growth. Augmented reality-based dining experiences, and customised AI-driven menus are influencing the flavours and fragrances market in GCC.

• The younger population in the GCC region has a significantly higher frequency of fast-food consumption. Due to significant economic development and changing dietary patterns, fast food has increasingly been incorporated into the Arabian diet. Global fast-food chains, such as McDonald's Corporation, Herfy, and Kentucky Fried Chicken are widely popular in the region.

GCC Flavours and Fragrances Market Trends

The younger working-class population in GCC is willing to spend a substantial amount on luxury personal care products, including personalised perfumes that match their personalities and preferences. Further, the cultural diversity in the region is augmenting the demand for varied cuisines. Rising per capita income, busy consumer schedules, and the rising tourism sector are further expanding the food service sector.

As per the GCC flavours and fragrances market analysis, GCC countries are also witnessing the trend of natural and organic beauty and personal care products. Further, the changing consumer preferences are increasing the demand for better-quality and healthier food products. Consequently, the demand for natural flavours and fragrances is rising.

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Market Segmentation

GCC Flavours and Fragrances Market Report and Forecast 2024-2032 offers a detailed analysis of the market based on the following segments:

Artificial flavours segment is expected to hold a significant GCC flavours and fragrances market share due to the cost-effective pricing of artificial flavourings

The artificial segment is benefitted by the ease of producing artificial flavours. Artificial flavours require less processing, less energy and a significantly shorter production schedule, making it a preferred option. The lowered pricing of artificial flavours is also a key factor in its greater adoption. Prominent companies offering artificial flavours in GCC include Global Flavours and Fragrances, and Bell Flavors & Fragrances.

The natural segment, on the other hand, is driven by the trend of sustainability in the GCC region. Chefs use natural seasoning blends made from peppers, coriander, cumin, and garlic that provide foods with a variety of flavours. Further, natural fruit-flavoured beverages are popular in GCC as consumers demand refreshing and clean-label drinks.

The nature-identical segment of the GCC flavours and fragrances market report refers to the flavours purified from an aromatic source or synthesised and consist of the same chemical composition as natural products. The use of nature-identical flavours is considered a sustainable alternative, where certain natural sources are scarce or expensive.

Soaps and detergents hold a significant market share due to rising hygiene consciousness in the region

Soaps and detergents account for a significant share in the GCC flavours and fragrances market. It is driven by the increasing demand for hygiene products. Detergent producers integrate perfumes that adhere to stringent safety guidelines, following the standards established by the International Fragrance Association (IFRA) and the Research Institute for Fragrance Materials (RIFM). Prominent soap and detergent manufacturers in the GCC include Knooz Al-Ardh Detergent Manufacturing CO. LLC, Fayfa Chemicals Factory LLC, Procter & Gamble Co., and The Camel Soap Factory.

The GCC flavours and fragrances market forecasts that the cosmetics and toiletries segment will also likely account for a significant market share. Changing social and cultural norms in society are increasing the acceptance of beauty and cosmetic products in the region. With around 50% of the Saudi Arabian population below 30 years of age, spending on beauty products is on the rise.

The fine fragrances segment is expected to grow at a high rate during the forecast period.  The presence of several perfume manufacturers aids the consumption of fragrances. For instance, Dubai in the UAE is a manufacturing hub of perfumes. It is home to prominent Arabic-style fragrance houses, including Ajmal, Rasasi, Lattafa, Swiss Arabian, and Samawa. Non-alcoholic perfume oils are popular among the Arabs. These are made from pure fragrance oils. This is propelling the GCC flavours and fragrances market growth.

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Competitive Landscape

The market players are increasing their collaboration, partnership, and research and development activities to gain a competitive edge in the market

Other key players in the GCC flavours and fragrances market include DSM-Firmenich AG, RFF International, Senovia, Gulf Flavours & Food Ingredients FZCO, and Global Flavours and Fragrances, among others.

GCC Flavours and Fragrances Market Analysis by Region

Saudi Arabia is one of the prominent regions due to the expanding food processing and soap and detergent sector

According to the flavours and fragrances market in GCC, Saudi Arabia boasts a developing food manufacturing and processing sector, supported by a growth in income, and significant economic alliance. The food sector of Saudi Arabia is set for a USD 20 billion boost by 2035, driven by increasing investments. Further, individuals aged 15-44, comprising about 53% of the population are significant consumers of flavourful fast foods, contributing to the growth of the flavours and fragrances market in the GCC. The market for detergents in the Kingdom is growing steadily driven by the growth in complementary markets, such as textiles. In 2022, the Kingdom’s textiles and fabrics sector recorded over USD 1 billion worth of investment.

The United Arab Emirates UAE is a prominent perfume producer in the GCC. Fragrances are consumed by local perfume producers, including Rasasi Perfumes Industry LLC, Yas Perfumes, and Ajmal Perfumes. The country is expected to significantly contribute to the GCC flavours and fragrances market development during the forecast period.

Further, the expanding fast food sector in Kuwait is increasing the demand for flavours in the region. The average monthly expenditure on food and drinks by Kuwaitis accounts for USD 1,200, while expats spend about USD 520 per month. Kuwait has the presence of 12,000 restaurants, of which 5,500 come under the dessert segment, while 3,000 are cafes.

Key Highlights of the Report

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GCC Flavours and Fragrances Market Report Snapshots

GCC Flavours and Fragrances Market Size

GCC Flavours and Fragrances Market Trends

GCC Flavours and Fragrances Market Regional Analysis

GCC Flavours and Fragrances Companies