Global Sandalwood Oil Market to Reach US$162.1 Million by 2030

The global market for Sandalwood Oil estimated at US$122.7 Million in the year 2024, is expected to reach US$162.1 Million by 2030, growing at a CAGR of 4.7% over the analysis period 2024-2030. Natural, one of the segments analyzed in the report, is expected to record a 5.3% CAGR and reach US$119.2 Million by the end of the analysis period. Growth in the Lab-Created segment is estimated at 3.3% CAGR over the analysis period.

The U.S. Market is Estimated at US$32.2 Million While China is Forecast to Grow at 8.3% CAGR

The Sandalwood Oil market in the U.S. is estimated at US$32.2 Million in the year 2024. China, the world`s second largest economy, is forecast to reach a projected market size of US$37.2 Million by the year 2030 trailing a CAGR of 8.3% over the analysis period 2024-2030. Among the other noteworthy geographic markets are Japan and Canada, each forecast to grow at a CAGR of 1.7% and 5.0% respectively over the analysis period. Within Europe, Germany is forecast to grow at approximately 2.0% CAGR.

Global Sandalwood Oil Market - Key Trends and Drivers Summarized

Why Is Sandalwood Oil Gaining Popularity in Personal Care and Wellness?
Sandalwood oil, derived from the heartwood of sandalwood trees, is highly valued in the personal care, aromatherapy, and wellness industries for its calming fragrance, anti-inflammatory properties, and skin rejuvenation benefits. The rising consumer preference for natural and organic ingredients in skincare, haircare, and cosmetic products is driving the demand for sandalwood oil, particularly in premium and luxury segments. Its use in aromatherapy for relaxation, stress relief, and meditation is also expanding, supported by growing consumer interest in holistic wellness practices. Moreover, sandalwood oil is widely used in traditional medicine systems, such as Ayurveda and Traditional Chinese Medicine (TCM), for its therapeutic benefits in treating skin disorders, respiratory issues, and mental stress. The multifaceted applications of sandalwood oil across personal care, wellness, and traditional medicine are underpinning its strong market growth.

How Are Sustainable Practices and Ethical Sourcing Influencing the Sandalwood Oil Market?
The increasing focus on sustainability and ethical sourcing is significantly shaping the sandalwood oil market, as consumers and companies become more conscious of environmental impact and social responsibility. Over-harvesting and illegal logging have historically threatened natural sandalwood resources, prompting a shift towards sustainable and legally regulated cultivation practices. Cultivation of sandalwood plantations in countries like Australia, India, and Sri Lanka is gaining traction, ensuring a steady supply of high-quality sandalwood oil while promoting environmental conservation. The emergence of synthetic and lab-grown sandalwood oil is also offering an alternative to natural sandalwood, catering to the demand for sustainable and cost-effective ingredients. Companies are increasingly adopting transparent supply chain practices and certifications to validate the ethical sourcing and sustainability of their sandalwood oil products, which is enhancing consumer trust and brand loyalty.

What Market Trends Are Driving the Demand for Sandalwood Oil?
The sandalwood oil market is shaped by several key trends, including the growing popularity of natural and organic beauty products, the rising demand for aromatherapy and wellness solutions, and the increasing focus on sustainable and eco-friendly sourcing. The trend towards natural and organic skincare, driven by consumer concerns about synthetic chemicals and allergens, is propelling the demand for sandalwood oil in formulations that promise safety, efficacy, and luxury. The expansion of the aromatherapy and wellness industry, which emphasizes holistic health and self-care, is also boosting the demand for sandalwood oil in essential oil blends, diffusers, and massage oils. Additionally, the growing awareness of sustainable sourcing practices and the trend towards green packaging and branding are creating new opportunities for premium sandalwood oil products that cater to environmentally conscious consumers.

What Are the Key Drivers of Growth in the Sandalwood Oil Market?
The growth in the sandalwood oil market is driven by several factors, including the rising demand for natural and organic ingredients in personal care and wellness, the increasing focus on sustainable sourcing practices, and the expansion of aromatherapy and traditional medicine applications. The growing consumer preference for clean beauty products, free from synthetic chemicals and allergens, is driving the adoption of sandalwood oil in skincare, haircare, and cosmetic formulations. The focus on sustainable cultivation and ethical sourcing, supported by government regulations and certifications, is enhancing the supply chain integrity and market appeal of sandalwood oil. The rising popularity of aromatherapy, meditation, and holistic wellness is also contributing to the demand for sandalwood oil in essential oils and therapeutic products. Moreover, the growing application of sandalwood oil in Ayurvedic and traditional medicine practices for its therapeutic benefits is further supporting market growth.