Exporting rose geranium oil to Europe

European demand for rose geranium oil, especially the Bourbon variety, is growing. This is the result of a growing market for natural fragrance ingredients and a renewed interest in aromatherapy. This opens up the market for new producers.

1. Product description

Hundreds of varieties of rose geranium exist, but only a few are suitable for commercial essential oil distillation. On the European market, the most common type for essential oil production is Pelargonium graveolens. This species is likely a crossover of different rose geranium species. The plant is called a geranium because it is part of the Geraniaceae family. A number of other Pelagargonium species are listed in the CosIng database as sources of essential oils and other extracts. For example, Pelargonium capitatum, Pelargonium asperum and Pelagonium radens.

Rose geranium essential oil is mainly extracted from the leaves of the plant with steam distillation. The oil is a clear, colourless liquid and has a rose-like smell. For that reason, rose geranium oil was traditionally produced to replace the more expensive rose oil.

Currently, rose geranium oil is mostly used in cosmetics in fragrances and skin care products. The flavour and aromatherapy industries are smaller users of rose geranium oil.

Rose geranium is native to South Africa, Zimbabwe and Mozambique. The plant is also cultivated in other parts of Africa, Europe, Asia and North America.

Currently, most suppliers of rose geranium essential oil are found in

• China
• Egypt
• Algeria
• Morocco
• Madagascar
• South Africa
• Réunion Island (overseas department of France).

However, there are suppliers in other countries as well.

There are different grades of rose geranium oil. On the market, the Bourbon rose geranium oil from Réunion Island is seen as the highest quality. This variety was named after the island, which was formerly called Bourbon Island. Other countries that produce this same variety called Bourbon variety geranium oil include South Africa and Madagascar. Oils that have not been produced on Réunion Island may not be called Bourbon geranium oil.

There is also an ISO standard for geranium essential oils: ISO 4731:2012. This standard specifies certain characteristics of essential geranium oil (Pelargonium × spp.) from different Pelargonium species commonly known as Pelargonium graveolens, in order to facilitate assessment of its quality.

See Table 1 for the classification of rose geranium oil. These codes and ingredient names are used to identify product identification in documentation (as listed in COSING and with CAS number) and in trade (through Harmonised system codes).

Table 1: Classification of rose geranium oil

Source: European Chemicals Agency, CosIng, Trade Helpdesk  

2. What makes Europe an interesting market?

Growing European market for rose geranium oil and other essential oils

According to industry sources, demand for rose geranium oil is growing and currently outstripping the growth in supply. World market demand for the various geranium oils is estimated at 400 tonnes per year. Of that, the market for rose geranium oil is about 100 tonnes.

The market for organic rose geranium oil has also increased in recent years, now accounting for 10–12% of the total market. Demand for fair-trade certified rose geranium oil is limited.

European demand for rose geranium oil is met by imports. Historically, this oil has been produced in Europe. However, production is now considered too expensive as it is labour intensive. Moreover, the plants perform better in warmer climates.

Europe is the leading market for essential oils, accounting for 44% of global demand in 2015. Various market research organisations expect a strong growth in the global market for essential oils. In the coming years, demand is expected to grow between 8.4% and 11.3% annually until 2024–2025, reaching between $14.0 and $15.8 billion.

Western European countries (France, the UK, Spain, Italy and the Netherlands) as well as Russia are estimated to be the largest importers of rose geranium oil. Industry sources indicate that France is the largest importer. This country imports most of its rose geranium oil from Réunion Island.

Falling supplies of high-quality rose geranium oil

Industry sources indicate that supplies cannot keep up with the growing demand for rose geranium oil, offering opportunities for new producers. In particular, supplies from Réunion Island have been falling. This is the main supplier of Bourbon rose geranium oil, high-quality rose geranium oil. Réunion Island produces around 10 tonnes. To fill this gap, South African producers have increased their production of rose geranium in the last five years from a few tonnes to 20–25 tonnes.

Madagascar and the Comoros are smaller suppliers of Bourbon variety geranium oil, producing a few tonnes.

Various countries in Eastern Africa have also entered the market for rose geranium oil to fill the gap in supply. These include:

• Rwanda
• Malawi
• Botswana
• Zimbabwe
• Mozambique
• Swaziland
• Democratic Republic of the Congo.

According to industry sources, supplies of rose geranium oil from these countries have been inconsistent. Rose geranium cultivation is a labour-intensive process. Plants are prone to various diseases, are unable to cope with too much rain and usually do not live longer than 3–4 years.

Growing European market for natural fragrances

Europe is the largest market for natural fragrance ingredients and will continue to be an important driver for global demand for natural fragrances. The European market for natural fragrance ingredients is projected to grow even faster than the global market. Forecasts for Europe are a growth of 6.5% annually from 2016 to 2024, compared to 5.8% for the global market. This stronger growth in Europe is the result of rising consumption of natural cosmetics and the presence in Europe of global leaders in the natural flavour and fragrances industry.

Transparency Market Research estimates that in 2016, the European market for natural fragrance ingredients amounted to just over $1 billion. This is almost one third of the global market ($3.3 billion in 2015). The global market is expected to reach $5.3 billion in 2024.

Western Europe is a key player in growing global market for aromatherapy

Besides its main use in fragrances, rose geranium oil also has potential in the growing aromatherapy market. In aromatherapy, rose geranium oil is used for its balancing and relaxing scent.

Future Market Insights expects that the global aromatherapy market will grow by 7.7% annually from 2016 to 2026 to reach just over $8 billion in 2026 (€7 billion). North America and western Europe are the two dominant markets, accounting for more than half of the global market.

In Europe, there are strong markets for aromatherapy in France, Germany, Austria and Switzerland. In these countries, aromatherapy is also commonly used as a medicine.

The United Kingdom and the Netherlands are good markets as well. Here, aromatherapy is marketed under cosmetics legislation.

3. What requirements must rose geranium oil comply with to be allowed on the European market?

Requirements for cosmetic ingredients

You can only export your rose geranium oil to the European cosmetics market if you comply with the legal requirements for natural ingredients for cosmetics. These include:

• Relevant European cosmetics legislation (Regulation (EC) 1223/2009)
• Documentation: supplying your buyers with well-structured product and company documentation
• Registration Evaluation and Authorisation of Chemicals (REACH)
• Classification, Labelling and Packaging of chemicals (CLP), you can also discuss with the freight forwarder or transport company who will also advise

Fragrance allergen legislation for cosmetic products

The European Union Cosmetics Regulation lists 26 fragrance allergens with a well-recognised potential to cause allergies in susceptible individuals. Cosmetic products need to include these allergens in the list of ingredients when their concentration exceeds 0.001% in leave-on products and 0.01% in rinse-off products.

In 2012 the Scientific Committee on Consumer Safety (SCCS) published an opinion about perfume allergies. The SCCS concluded that the current regulations on fragrance allergens are insufficient. They identified more than 100 additional individual substances and natural extracts as likely contact allergens. The SCCS recommends that consumers need to know whether cosmetic products include these additional allergens as well.

As a result, European buyers expect new, stricter legislation on the testing and communication of fragrance allergens. This could include adding more allergens to the existing lists and the requirement to list all these allergens on packaging.

In particular, buyers expect that these new rules will have a negative effect on demand for essential oils for cosmetics. Cosmetic producers may use less of a particular oil or fewer essential oils in their products to avoid long lists of allergens on their final product. Alternatively, they may use synthetic ingredients instead of natural ones.

Access and Benefit Sharing

You also need to comply with requirements based on international treaties on using and trading plant resources.

The Nagoya Protocol contains terms and conditions for companies that want to carry out research and development on genetic resources or benefit from traditional knowledge. It aims to make sure the benefits of genetic resources and traditional knowledge are shared in a fair and equitable way. This is called Access and Benefit Sharing (ABS).

European companies are legally required to follow those laws that are in force in your country regarding access and benefit sharing. Gradually, countries are implementing legislation to govern access to genetic resources.

You will need to find out if the use of the genetic resources falls within the scope of the ABS legislation in the country of origin. If it does, European companies will need evidence that the entire upstream supply chain in the country of origin complies with those national laws.

Anyone who carries out R&D, including the buyer downstream in your supply chain, has ABS obligations under the Nagoya Protocol. They will be responsible for compliance with ABS, but might ask you for help. The national legislation of the country of origin also defines the specific meaning of R&D, or “utilisation” of genetic resources.

Additional buyer requirements

Many European buyers have requirements that can go beyond legislation and standards. These are established in buyer specifications and include the following requirements:

• Good and reliable level of quality, by following basic practices such as Hazard Analysis & Critical Control Points or Good Manufacturing Practices of the European Federation for Cosmetic Ingredients if you want to do more.
• Being a sustainable supplier, to ensure future availability of your ingredients. Provide living wage to your collectors and ensure you can deliver a stable quality and quantity of rose geranium oil. Certification of these sustainable practices is only a requirement for niche markets.
• Showing good Corporate Social Responsibility practices, such as developing code of conduct and improving your performance in key areas (for example child labour and limiting damage to the environment). For examples, check out the websites of L’Oréal (France) and Rituals (Netherlands).

Voluntary standards and certifications

Standards for cosmetic ingredients include:

• Natural cosmetics, the largest and most important niche market: NaTrue and Cosmos.
• Organic cosmetics: Soil Association (United Kingdom) and Ecocert (France) also certify according to Cosmos standard for natural and organic cosmetics. BDiH (Germany) also has their own standard.
• Fair production, small niche market in terms of certified cosmetic ingredients: Fairtrade.
• International Organisation for Standardisation (ISO) 16128 standard as an alternative minimum self-certifiable standard, which covers definitions and criteria for natural and organic cosmetic ingredients and products. Buyers of cosmetic ingredients expect that private sector standards will continue to remain the standard for natural and organic cosmetics in Europe, until Europe introduces legal standards. However, the ISO standards are an option for small producers for which certification according to a private standard is too expensive or not required.

Quality requirements

On the European market, Bourbon rose geranium oil from Réunion Island is most popular.

The International Organization for Standardization (ISO) has developed a standard for Pelargonium oils that are commonly known as Pelargonium graveolens. This standard, ISO 4731:2012, specifies certain characteristics of these essential oils to make quality assessment easier.

The aroma of rose geranium oil depends on the proportions of its main compounds:

• alcohols (55-65%): citronellol, geraniol and linalool
• esters (15%)
• ketones, such as isomenthone (1-8%).

The compounds citronellol and geraniol give the oil its rose-like odour. The European perfumery and fragrance industries prefer rose geranium oils where the ratio of those two compounds is close to 1:1.

Buyers want oils of a consistent quality. They need to be:

• 100% natural (not adulterated through the addition of chemicals)
• 100% pure (not mixed with, or infused in, any other oils that have similar characteristics).

Labelling and documentation requirements

You need to comply with the Globally Harmonised System for classification, labelling and packaging regulations, (which have been adopted under EU CLP legislation 1272/2008) for the labelling of your rose geranium oil:

• Set up a registration system to identify and trace individual batches of your rose geranium oil, whether they are blends or not, and mark them accordingly to ensure traceability.
• Label your products in English, unless your buyer wants you to use a different language.

Your labels must include:

• Product name/INCI name
• Batch code
• Place of origin
• Name and address of exporter
• Date of manufacture
• Best before date
• Net weight
• Recommended storage conditions.

For organic essential oils, include the name/code of the inspection body and the certification number.

You also need to give your buyer the following documentation:

• Technical data sheet (TDS) (check this example of a TDS for rose geranium oil)
• Certificates of analysis (check an example for rose geranium oil)
• Safety data sheet (SDS) (according to EU regulation 1272/2008)
• GMO certificate (if requested), see an example of a non-GMO declaration from Ecocert
• Certificate of origin
• Product information sheet
• 100% composition of the oil
• Allergen declaration, check examples of different geranium oils for more information.

Your buyer may also request other declarations such as a No Animal Testing Declaration

Rose geranium oil is classified as hazardous, such as tea tree oil or frankincense oil. For these oils, you need to include relevant hazard symbols (see Figure 1) to indicate that the oil may be fatal if swallowed and enters airways, is toxic to aquatic life with long lasting effects, causes serious eye damage, causes skin irritation and may cause an allergic skin reaction. You also need to include relevant risk and safety phrases.

Figure 1: Hazard labels for rose geranium oil

Packaging requirements for rose geranium oil

Packaging requirements differ per buyer. However, there are some general requirements you have to take into account to preserve the quality of the product. See the tips below.

4. What competition do you face?

Market entry barriers

Rose geranium cultivation, hand weeding and harvesting is labour intensive. The plants are unable to cope with too much rain and are prone to various diseases, such as leaf rust. This disease is difficult to treat, especially in organic production. Moreover, plants usually will not live longer than 3–4 years before requiring replanting.

To access the European market, you need to supply stable quantities of oils at a consistent quality. Be aware that steam distillation could require substantial investments.

You need to show good practices in terms of your supply chain:

• harvesting of raw materials
• processing
• use
• availability
• traceability.

It is very important to have documented processes to show your buyers how you manage risks on all of those above points. Ideally, you would certify all of those processes.

Product competition

Product competition is limited for rose geranium oil. Its fragrance and especially its aromatherapy benefits in cosmetics are the result of the oil’s specific chemical composition.

Some cosmetic manufacturers use synthetic versions of rose geranium oil components. For example, industry sources indicate that low-priced cosmetic products use synthetic geraniol. However, it is unlikely that manufacturers using rose geranium oil would switch to such synthetic ingredients. Many use the whole oil for its fragrance, reducing the risk or substitutions as the subtle aromas of its various compounds are more difficult to replicate with synthetic ingredients.

Substitution with new ingredients is not attractive to manufacturers once they have included a particular essential oil in a cosmetic product (range) and have built up its market, in particular if the oil features strongly in the products story.

Cosmetic manufacturers will not commonly switch suppliers or include new ingredients once they have included a particular oil in a cosmetic product (range) and have built up its market. Manufacturers are also more interested in new ingredients when they develop new products or product ranges

Company competition

You will find most competition for rose geranium oil from companies in Southern and Eastern Africa, such as:

• South Africa
• Madagascar
• Rwanda
• Comoros
• Réunion Island (overseas department of France).

Producers in Réunion Island have an advantage over producers in other countries. As an overseas department of France, this country is part of the European Union and has no limitations on exports. However, the country has not made significant increases in production volumes.

Upcoming suppliers in South Africa may be a stronger source of competition. South Africa especially is a fast-growing supplier of Bourbon variety rose geranium oil, the variety in highest demand on international markets.

Smaller countries in Eastern Africa have also started or increased production to fill this gap. Although supplies of these countries are inconsistent, they could become future competitors (see falling supplies of Bourbon rose geranium oil).

China and Egypt produce significant quantities of geranium oil, but these are a different variety from rose geranium oil. In general, these varieties are in lower demand on the European market than (Bourbon) rose geranium oils and prices are lower, for example of oils from Egypt.

At the same time, buyers are increasingly turning to Chinese suppliers of geranium oils. As a result, prices for these oils have increased to a similar level as Bourbon rose geranium oil.

To differentiate your rose geranium from rivals on the market, you need to find your unique selling point. This will also help improve your negotiation position towards buyers. You can do this by:

• producing a Bourbon variety rose geranium oil
• developing interesting marketing stories
• certifying your rose geranium oil, especially as organic; these certifications can help you to target high-end and organic cosmetic brands
• excelling in corporate social responsibility (CSR), although since buyers today always expect a certain degree of CSR it is difficult to get a better price for this; this is becoming a basic market requirement
• improving access to resources and sustainability of the resource.

Along with finding a unique selling point for your product, you should also build your company reputation to stand out from your rivals. Industry stakeholders indicate that companies increasingly use their reputation to stand out from the competition, instead of focusing on the individual products they produce.

Having a strong company reputation based on trust may make it easier to stand out from the competition and improve your negotiating position. Buyers are less likely to switch to another supplier if they trust your company. This also means that if you damage the relationship you have with your buyers, they will be more susceptible to new suppliers.

5. Through what channels can you get rose geranium oil on the European market?

Which market segments should you target?

To determine which market segment you should target with your rose geranium oil, you need to answer the following questions.

1.What does your essential oil do?

You need to consider how your oil relates to the general properties of rose geranium oil. In COSING, the oil is registered with perfuming and masking properties. Rose geranium oil is mostly used for its scent, as a middle note fragrance. It is used in different ratios in fragrances, but rarely as the sole fragrance. Rather, it is supported by other scents.

In aromatherapy cosmetics, rose geranium is also used for its relaxing and balancing scent.

Different extracts of rose geranium might have additional properties. For example, rose geranium extract is also registered with skin conditioning properties.

2.For which industry segment is your essential oil useful?

Rose geranium oil is used as a fragrance in almost all industry segments.

• Perfumes and fragrances: for example, in perfumes and eau de toilette
• Skin care: in products such as face creams, body care, moisturiser, and skin care products with an aromatherapy benefit
• Hair care: for example, in shampoos
• Toiletries: in high-end toiletries, such as luxury soaps or bath essences

The oil has most potential in perfumes and skin care products. Consumers tend to be more willing to pay a higher price for these products.

3.For which kind of player is your essential oil interesting?

Both natural and conventional cosmetic brands are interesting for rose geranium oil. This oil is already used in a wide range of products.

If you can ensure stable quantities and qualities, big cosmetic brands offer good opportunities. If you produce a low volume, high value speciality essential oil, natural cosmetic brands can be a good choice.

4.What is your unique selling point?

Your unique selling point for rose geranium can be based on its market appeal, or composition. You need to find out how your product stands out from its competition. What makes it different or special? For example:

• Does the composition of your rose geranium oil interest buyers?
• Do you offer an oil with an interesting marketing story?

6. Which channels can you use to put rose geranium oil on the European market?

Rose geranium oil generally does not require further refining or processing before it can be used in cosmetics. Compared to other ingredients, essential oils can more easily be sold to cosmetic manufacturers directly. However, the most common practice is still to export essential oils to European importers. These importers have a wider assortment of essential oils and natural ingredients. Trading through importers reduces risk for cosmetic manufacturers.

7. What are the end-market prices for rose geranium oil?

The origin and resulting composition of geranium oils are the main determinant of its price. Prices are rather volatile and differ considerably per origin and variety of geranium oil.

Quality also impacts the price, but it is a subjective factor. You need to comply with legal requirements as a minimum quality. Beyond that, your buyer will decide how they define “high quality”. For example, buyers prefer Bourbon rose geranium oil over other varieties and are willing to pay more for this variety.

As supplies of Bourbon rose geranium oil are insufficient, importers are increasingly buying Chinese geranium oils as an alternative. Although these are of a lower quality than the Bourbon rose geranium oils, they currently fetch a similar price: €230 per kg.

As demand for Bourbon rose geranium oil increases faster than supplies, the price for non-organic certified oils increased to a level similar to organic Bourbon rose geranium oils: €230 per kg. Organic Bourbon rose geranium oils are still priced higher than organic geranium oils (not rose geranium): at €170–180 per kg.

Geranium oil from Egypt are currently sold at around €90 per kg. This oil is less popular compared to rose geranium oils as it has a different, sharper scent.

The yield of rose geranium oil is around 0.30–0.50%. This means that for 1 kg of rose geranium oil, you need around 300–500 kg of plant material. Oil yield is about 30–50 kg per year per hectare of cultivated rose geranium. If you can increase your yield, you could increase your margins or offer a more competitive price. Options to optimise the yield of rose geranium cultivation include:

• Cutting plants at 15 cm above the ground to allow new leaves to grow. As such, you can harvest plants 3–4 times per year. Ensure that the first harvest is 6–8 months after planting to allow the plant to grow to the right size.
• Harvesting the leaves and young shoots of the plant, which contain the most oil.
• Harvesting plants in the summer, when the oil content is higher.
• Only harvesting plants when they are dry, as humidity during harvesting can lower the oil yield. Stop irrigation before harvesting and do not harvest for 1 or 2 days after rainfall.
• Packing your distillation unit tightly to increase oil recovery.

Please review our market information disclaimer.