Latin America Flavours and Fragrances Market Report and Forecast 2024-2032

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The region, which represents just over a tenth of the global industry, is expected to grow faster than mature markets like North America and Western Europe. Currently, the Flavours and Fragrances industry is dominated by Europe and North America with the Asia Pacific emerging as a significant market. Within Europe, the Eastern European countries are projected to witness a more rapid growth in the coming years than the more mature Western Europe. Currently, Germany leads the industry, driven by its thriving food and beverage and beauty sectors. The North American market is led by the US, while in the Asia Pacific, the industry is led by emerging economies like China and India along with mature markets like Japan. The industry, globally, is being driven by the diversification and innovation in the products as well as the growth in their application sectors.

In the Latin America, Brazil is the major player, accounting for over 40% of the market share. Brazil is the largest economy in the Latin America region. With a growing middle-class population and rising urbanisation, the industry in the region is expected to grow due to the consequent change in consumption pattern. In 2017, over 85% of the Brazilian population lived in urban areas with the urbanisation projected to grow at an annual rate of nearly 1%. Argentina, another leading Latin America economy, is the second largest market for flavour and fragrance. The industry in both these Latin America nations is being driven by the change in consumption patterns as defined by the rising middle-class population. The rising applications of flavours and fragrances, despite the relative instability of the economies in the countries, is further aiding the industry growth in these countries as well as the region, as a whole.

Properties and Applications

Flavours are perceived by the tongue and are introduced to products like foods and beverages to augment the taste of the substance. Fragrances, on the other hand, are felt through the olfactory senses and impart a pleasant odour to products.

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By the type of flavouring agent, the industry can be divided as nature identical, artificial, and natural flavouring substance. They are found in either liquid or dry forms, with the dry form dominating the global industry. Fragrances, on the other hand, can be bifurcated into synthetic and natural. Natural fragrances can be further subdivided into:

• Flowers
• Fruits
• Musk
• Wood
• Spice
• Others

While flavours find their applications in sectors like beverage, dairy and frozen desserts, savouries and snacks, and bakery and confectionery products, among others, fragrances find their uses in sectors like:

• Soap and Detergents  
• Cosmetics and Toiletries
• Fine Fragrances
• Household Cleaners and Air Fresheners 
• Others

The report by EMR also gives an in-depth insight into the regional markets of Latin America like Brazil, Argentina, and others.

Market Analysis

The Latin America Flavours and Fragrances market is being driven by the extensive use of the products in their application sectors. The growth in food and beverage, and beauty industries, especially in countries like Argentina and Brazil, is aiding the market growth in the region. Brazil is the largest beauty market in the region, with the industry accounting for 1.8% of the country’s GDP. The industry is aiding the growth of the fragrance sector in particular with increased purchases of deodorant and fragrances. Being a hygiene conscious country, it is aiding the growth of the soaps and detergents application sector of fragrances. Brazilians are also increasingly seeking out natural flavours and fragrances along with premium products like fine fragrances.

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In Argentina, consumers are seeking tier-2 and 3 brands over premium products with companies attracting consumers with offers and discounts on products purchased through supermarkets and direct sellers. The affordable prices offered by the key players in the cosmetics industry is propelling the increased growth of the bath and beauty products, with fragrances witnessing a comparatively higher demand.  The fragrance sector in the country is being driven by the expansion of the sector into specialised men’s fragrances and growth in gift-based purchases around holidays and special occasions.

The thriving food and beverage industry in the Latin America region is aiding the flavour industry growth. Flavours, globally, find their leading use in the beverage segment, and is thus, aided by the robustly growing beverage industry in Latin America. Latin America and the Caribbean, as a whole, account for nearly 17.5% of the global beverage industry. The Flavours and Fragrances industry is also being aided by the rise in the number of people seeking out healthier food products while unwilling to compromise on taste. Thus, these healthier food products are imbibed with additional flavours. The growth in the consumption of processed products is also driving the market in the region.

Competitive Landscape

The report gives a detailed look into the following key players in the Latin America flavour and fragrances market, covering their market share, capacity, and latest developments like plant turnarounds, mergers and acquisitions, and capacity expansions:

• Givaudan SA
• Firmenich SA
• Geroma Do Brasil Industria E Comercio Ltda
• Frutarom Industries Ltd.
• Giannone & Cia. Ltda.

The EMR report assesses the market based on the Porter’s Five Forces model. A SWOT analysis has also been provided.