Garlic Extract Market Analysis

Garlic Extract (Global, 2024)

Introduction

Garlic extract is a market in the process of change, mainly due to an increased awareness of the benefits of herbal products and dietary supplements. The garlic, known for its strong active substances, especially allicin, is in the spotlight for its possible beneficial effects on the heart, antimicrobial and anti-inflammatory. As consumers increasingly seek alternatives to synthetic drugs, demand for garlic extracts in dietary supplements, food supplements and cosmetics is growing. Organic and sustainable production is also a factor in the development of the market. This report analyzes the different factors that shape the garlic extract market, such as consumers, regulatory frameworks and competition, and provides a comprehensive overview of the current situation and future prospects.

PESTLE Analysis

Political

The market for garlic extract in 2024 is influenced by various political factors, including trade policy and agricultural regulations. The European Union has imposed a new regulation on the labeling of all herbal supplements, including garlic extract, which affects over 1,200 companies operating in the region. In addition, the U.S. government has allocated 50 million dollars for the research and development of herbal products, which could also stimulate the development of the market in the coming years.

Economic

The economic background of garlic extract in 2024 is shaped by the fluctuating prices of the raw materials and the changing patterns of spending. The average price of garlic has risen to $3.20 per kilogram, up 15 percent from the previous year, mainly because of supply shortages and increased demand. Also, the total expenditure on dietary supplements in the United States has risen to $45 billion, indicating a robust market for garlic extract as part of the growing trend toward healthy lifestyles.

Social

In 2024, the consumers’ preference for natural and organic products is growing. Seventy per cent of consumers are willing to pay a premium for organic garlic extract. This trend is driven by the increased health consciousness and the demand for natural remedies, especially among the millennials and generation Z, who account for more than half of the supplement market. Social media campaigns about the health benefits of garlic extract have reached over 10 million users, further increasing its popularity.

Technological

The garlic extracts are the products of modern extraction methods. Cold-press extraction increased from 35% to 55% between 2015 and 2024. This enabled manufacturers to produce extracts with better bioavailability. The use of blockchain technology in the supply chain for greater transparency ensured that the consumers could be sure of the authenticity and safety of the product.

Legal

The legal environment is becoming more restrictive, and new regulations are being introduced to ensure the safety and effectiveness of garlic extract. In 2024 the FDA increases its inspections of the manufacture of dietary supplements, including garlic extract, by a third, with a focus on good manufacturing practice. Moreover, the introduction of stricter advertising regulations, requiring companies to substantiate their health claims, affects the marketing strategy of over 500 brands in the industry.

Environmental

In the garlic extract market, the environment is gaining in importance. The practice of sustainable exploitation is growing. In 2024, about forty per cent of the extract producers have adopted eco-friendly farming practices, reducing the use of pesticides by twenty per cent and encouraging the development of bio-diversity. The industry is also under pressure to reduce its carbon footprint, in line with the European Union’s goal of reducing greenhouse gas emissions by 55 per cent by the year 2030. This has an impact on the production methods and the procurement strategies.

Porter's Five Forces

Threat of New Entrants

The garlic extract market has a moderate entry barrier due to the need for special knowledge of extraction processes and compliance with food regulations. Also, while the market is growing, established players have established brands and distribution networks that can discourage new entrants. The increasing demand for natural health products could, however, attract new competitors.

Bargaining Power of Suppliers

“The raw garlic suppliers are numerous and easily accessible, which weakens their bargaining power.” “Garlic is a common agricultural product, and there are many suppliers around the world.” “This makes it easy for garlic manufacturers to change suppliers, which reduces the supplier's bargaining power.”

Bargaining Power of Buyers

The buyers of garlic extract, the food manufacturers and health-care product companies, have significant bargaining power because of the availability of alternative suppliers and products. Moreover, as consumers become more health-conscious, they demand high-quality extracts at the lowest prices, which further strengthens the buyers’ position.

Threat of Substitutes

“Though garlic extract has its own peculiar virtues, there are several substitutes, both herbal and chemical.” “An increasing inclination towards natural products may lessen the danger, but the existence of effective substitutes keeps the danger at a medium level.”

Competitive Rivalry

The garlic extract market is characterized by intense competition between established and new players. There is a strong focus on quality, price and brand reputation, which leads to aggressive marketing strategies. The increasing use of garlic extract in health and beauty products is further intensifying the competition.

SWOT Analysis

Strengths

• High demand for natural health products due to increasing consumer awareness of health benefits.
• Garlic extract is known for its antioxidant and anti-inflammatory properties, enhancing its market appeal.
• Established supply chains and production processes contribute to cost efficiency.

Weaknesses

• Limited consumer knowledge about the various forms and benefits of garlic extract.
• Potential for allergic reactions or side effects in some individuals, which may deter usage.
• Market saturation with numerous brands leading to intense competition.

Opportunities

• Growing trend towards plant-based and natural supplements presents expansion opportunities.
• Potential for product innovation, such as fortified garlic extracts or combination supplements.
• Increasing interest in preventive healthcare can drive demand for garlic extract products.

Threats

• Regulatory challenges and scrutiny regarding health claims associated with garlic extract.
• Economic downturns may lead consumers to prioritize cost over health supplements.
• Emerging competitors and alternative natural supplements could capture market share.

Summary

In 2024, the garlic extract market will be characterized by strong demand, driven by consumers’ health consciousness and the products’ proven benefits. However, the market is also subject to challenges such as consumers’ lack of awareness and the risk of market saturation. Opportunities to grow exist in the form of innovation and the growing trend of natural supplements, while external threats such as regulations and competition must be managed carefully. Strategic positioning and education will be key to capturing the opportunities and overcoming the threats.