Niche market for natural ingredients

06 Sep, 2020 - 00:09 0 Views
Niche market for natural ingredients

The Sunday Mail

Trade Focus Allan Majuru

Export growth depends on inclusive participation by all, including rural communities that are usually marginalised.

While previous export development initiatives often focused on established industries and small businesses, there is a realisation that even rural communities can actively participate in export markets.

The inclusion of rural communities, particularly women and youths, is undoubtedly crucial in growing exports.

This can only be possible if they leverage on competitive advantages such as natural resource endowments.

There are opportunities to increase exports by focusing on products that do not require sophisticated machinery to process.

For example, rural communities could easily venture into exporting natural ingredients used for cosmetics.

The word “natural” has been trending in international markets over the past few years, with countries that are quick to adapt realising increased revenues in the shortest possible time.

From food to clothing, people are increasingly becoming interested in how the products they buy are produced, with a special focus on products that are produced from natural and organic raw materials.

This interest has resulted in a boom for cosmetics that are made from natural ingredients, instead of artificial or lab-grown raw materials.

Natural ingredients for cosmetics are usually raw materials extracted from plants or animals.

Demand for natural ingredients used in cosmetics continues to grow as consumers consider them safer and environmentally friendly.

Demand is being driven by growing consumer awareness for natural cosmetics and the desire of cosmetic companies to replace synthetic ingredients with natural variants.

The trend is shifting from products that enhance beauty superficially to cosmeceuticals that might, for example, repair damaged skin, repair damaged tissues, smoothen skin and protect from the sun and moisturise.

This has led to increased use of new active ingredients, including natural products with defined and specific biological effects.

This includes product groups such as vegetable- and animal-derived fats and waxes, vegetable saps and extracts, essential oils, raw plant material, colouring matter of vegetable or animal origin.

Export opportunities

The global import bill for these natural ingredients stood at approximately US$68 billion in 2019 and demand is estimated to have grown by 62 percent in the past five years.

Zimbabwean farmers can leverage on this growth by increasing production of products such as ximenia, moringa, turmeric, ginger, tea tree and aloe.

The major importers are United States of America, United Kingdom, Germany, France, Netherlands and Belgium.

In most countries, especially in Europe, there is increasing consumer sophistication and interest in all things natural, and consumers are now calling for healthier and more natural products.

In Europe, the personal care and cosmetics industry is becoming important and large multinational companies have recently entered the natural cosmetics space, which used to be dominated by small, alternative manufacturing and marketing companies.

Although many of these mass and prestige products contain small and sometimes insignificant amounts of natural ingredients, the message they send to the consumers that ‘natural is better’ is gaining traction.

Thus, the European cosmetics market presents good opportunities for exporters of natural ingredients in developing countries.

Local producers have the capacity to grow some raw materials used in various cosmetic brands that have the potential to contribute to exports.

For example, the tea tree plant that is used for various skin care products and even healing oil.

In 2019, the share of natural ingredients for cosmetics from developing countries into the EU was estimated at over 50 percent.

The main players in Europe are Germany, France, the United Kingdom and Italy.

Growth in the natural personal care and cosmetics market is not being experienced in the EU countries alone, but across the world.

For example, in South East Asia several local manufacturers have successfully introduced new products with plant extracts like cucumber, apricot, ginseng, iris and aloe.

The development of skin care products is moving towards highly refined raw materials of natural origin with defined constituents that have a specific biological effect to benefit healthy skin.

Significant new growth ingredients include enzymes, antioxidants, Vitamin A, C and E.  Classes of natural products of interest to the EU market include bio-saponins(steroids and triterpenoids), flavonoids, amino acids, non-protein bio-complexes, proteins and phytoamins, anti-oxidants, alpha and beta hydroxy acids, formulation acids, formulation aides and vitamins.

Products containing ingredients which yield these compounds include green tea, moringa, ximenia, ginger and aloe, most of which can be grown in Zimbabwe.

All these plants are mostly suited for dry regions and can flourish under rainwater only, as well as sandy or loamy soils which can withstand different weather conditions.

Zimbabwe is a country rich in plant biodiversity, which has traditionally been used for various purposes, be it for medical, beauty or cooking.

Local cosmetic and pharmaceutical companies can claim a significant market share if they follow global trends and reformulate their products to address the needs of niche markets, incorporate new ingredients and improve the performance of their products.

Natural ingredients, which have often been used traditionally, are now being developed and used not only for anti-aging effects but also for dermatological disorders.

Currently, women in rural areas such as communities around Binga are value adding plants like ximenia, moringa, turmeric, aloe and ginger, and are contributing to the cosmetics sector as producers, entrepreneurs, employees and consumers.

For example, Zubo Women Trust is producing the Jatropha soap, which has become very popular in areas around the Zambezi valley.

However, for them to expand their businesses, become more productive and innovative, they need capacity building to enable them to access domestic, regional and international markets.

ZimTrade, the national trade development and promotion agency, provides these capacity-building opportunities and market intelligence that are useful to local producers who would like to seize this opportunity. Local manufacturers can also use natural ingredients to build strong relations between industries and communities, as well as between communities and learning or development centres.

This can help in establishing sustainable supply chains as well as established quality assurance procedures and services.

Ethical sourcing is also likely to become more important in the cosmetics industry in the future.

Suppliers of natural ingredients from Zimbabwe should ensure that they are traceable.

  • Allan Majuru is ZimTrade’s chief executive officer.

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