The European market potential for aloe vera

European consumers are increasingly seeking nutritional supplements and health products. More consumers are turning to natural products and remedies for disease prevention and maintenance, as well as to improve their health and wellness. Health products companies are looking at natural ingredients when developing their products. Aloe vera-based health products are well known and established among European consumers.

1. Product description

With over 500 species of the Aloe genus, Aloe vera is the main commercially cultivated specie of the genus Aloe. It is widely cultivated in India, Mexico, the Dominican Republic, South Africa, China and Costa Rica. Aloe vera has many applications and is used by the cosmetics, food and toiletries and pharmaceutical industries. This study focuses on the use of Aloe vera in the European natural health products market.

Aloe vera has a number of health benefits; this is because Aloe vera has vitamins, minerals and amino acids; antibacterial, antiviral and antiseptic properties; the ability to accelerate wound healing, reduce dental plaque and help treat mouth ulcers; positive laxative effects; and the ability to improve skin and prevent wrinkles. It can also lower blood sugar levels.

Aloe vera is also known as (synonyms): Aloe barbadensis Mill; Aloe barbadensis var. chinensis Haw.; Aloe chinensis (Haw.) Baker; Aloe elongata Murray; Aloe flava Pers.; Aloe indica Royle; Aloe lanzae Tod; Aloe maculata Forssk. (Illegitimate); Aloe perfoliata var. barbadensis (Mill.) Aiton; Aloe perfoliata var. vera L.; Aloe rubescens DC.; Aloe variegata Forssk. (Illegitimate); Aloe vera var. chinensis (Steud. ex Baker) Baker; Aloe vera var. lanzae Baker; Aloe vera var. littoralis J.Koenig ex Baker; Aloe vulgaris Lam. Table 1 shows the application of Aloe vera in health products.

Table 1: Use of Aloe vera in health products, with its classification

Source: Various

The leaf processing and inner leaf processing method of processing Aloe vera to obtain its juice ingredient is the most commonly used in commercially available products according to the International Aloe Science Council (IASC):

1. Leaf processing method – with this method, Aloe vera leaf juice is obtained by grinding or macerating the entire Aloe vera leaf, followed by purification to remove the phenolic compounds found in the latex. This purification step is usually accomplished through activated carbon filtration in a process known as decolourisation.
2. Inner leaf processing method – with this method, Aloe vera leaf juice is obtained by stripping away the outer leaf rind, rinsing or washing away the latex and processing the remaining inner leaf material. Decolourisation is also sometimes employed in this method.

The processing of Aloe vera leaves provides gels and saps which are used by the health products, food and cosmetics industries. The processing of Aloe vera can be done in developing countries or in Europe. However, processing is usually done in developing countries, as this helps to retain most of Aloe vera’s beneficial properties.

Several types of Aloe vera gel extracts are present in the market. These include:
- Aloe vera gel extract;
- Aloe vera whole leaf extract/juice;
- Decolourised whole leaf extract/whole leaf Aloe vera gel;
- Dried Aloe vera latex.

Aloe vera is used in herbal medicinal products: it is only permitted as dried, concentrated leaf juice (for example, the latex). In food supplements, the use of Aloe vera gels, extract and latex is permitted, although its latex is only permitted with exceptions (see Specific requirements for food supplements). Dried Aloe vera latex is used for medicinal purposes and its composition is specified in several official pharmacopoeias.

Table 2: Example of Aloe vera products in the European health products market

Source: Various

2. What makes Europe an interesting market for aloe vera?

Europe has a prospective market for Aloe vera products because consumer demand for natural health products is growing. Aloe vera is used in supplements to promote digestive and overall immune well-being, which are in high demand. The ageing population in Europe as well as rising consumer interest in health and wellness products is stimulating demand. The European market offers good opportunities to Aloe vera suppliers in developing countries.

The European market for food supplements is expected to grow in the future. According to the Medical Nutrition Industry, 33 million people in Europe are affected by malnutrition. It is estimated that around EUR 170 billion a year is spent on malnutrition in European countries.

Moreover, European consumers are becoming more health conscious. Consumers are looking for ways to improve their health and well-being. Increasing life expectancy and the rise in chronic disease is stimulating demand for nutraceuticals and dietary supplements. According to the Fortune Business Insights, the European dietary supplements market is projected to reach USD 20.9 billion by 2026. The market is projected to grow at a compound annual growth rate of 4.9 percent between 2019 and 2026.

The global Aloe vera extracts market was worth USD 1.60 billion in 2018. The market is projected to grow at a compound annual growth rate of 7.6 percent between 2018 and 2025. Aloe vera is well known by European consumers. European buyers and health products manufacturers are familiar with the properties and applications of Aloe vera.

Aloe vera is used in nutritional supplements because it promotes digestive health and boosts immunity. There is growing demand for such products because of rising health consciousness among European consumers. The European digestive enzyme supplements market was valued at USD 205.3 million in 2018, according to Market Data Forecast. The market is expected to increase at a compound annual growth rate of 7.2 percent until 2023.

One of the major restraints to growth of the Aloe vera market is safety concerns about Aloe vera. In 2013, the European Food Safety Authority (EFSA) concluded that hydroxyanthracene derivatives (HADs) in food products can improve bowel function. However, EFSA advised against long-term consumption because of potential risks. Hydroxyanthracene derivatives are a class of compounds that is naturally present in botanicals, such as Aloe vera.

In November 2019, EFSA adopted the opinion that hydroxyanthracene derivatives in aloe extracts damage DNA and that whole-leaf aloe extracts are shown to cause cancer. EFSA was unable to determine a safe daily intake amount that would not give rise to health concerns. In March 2020, the European Commission issued a draft regulation that suggested a ban on aloe emodin, emodin, the leaves of Aloe species that contain HAD derivatives, danthron and all extracts that include these substances, citing “severe harmful effects on health”.

Aloe vera extracts that contain these substances should be added to Annex III, Part A of Regulation (EC) No 1925/2006, which is the list of prohibited vitamins, minerals and certain other substances in food. The potential ban could have a negative effect on Aloe vera raw material suppliers and producers of aloe products.

As the outcome of the regulation is not yet known, you should follow the development of this regulation. The adoption of this regulation could harm suppliers of Aloe vera and therefore affect the supply chain of Aloe vera to Europe.

Figure 1 shows imports data of vegetable saps and extracts with HS Code 130219 under which Aloe vera is traded. It shows that imports grew both in volume and in value. Note that many products fall under this HS code. However, the trends for this HS Code are applicable to Aloe vera, since there is increasing consumer demand for products containing Aloe vera in the European market.

Figure 1: Imports of vegetable saps and extracts with HS Code 130219 to the EU, 2015-2019

Source: Eurostat

The demand for Aloe vera from the health products sector in Europe is set to grow. Increasing health consciousness among consumers and growing expenditure on healthier food products and dietary supplements, as well as the ageing population in Europe, are driving demand for Aloe vera-based health products. The potential EU ban on certain substances that contain Aloe vera could dampen demand from the food supplements sector. However, this legislation does not apply to herbal and medicinal products. Moreover, the ban would not cover aloe extracts that have been processed to remove contentious substances for continued use in food.

There is also growing production of Aloe vera in European countries, such as Spain, Italy and Greece. The Mediterranean has suitable conditions for aloe cultivation. Although the production of Aloe vera in Europe is growing, it cannot meet demand in Europe. However, European processors prefer local supply because of the proximity and the freshness of leaves.

3. Which European countries offer most opportunities for aloe vera?

Western European countries offer Aloe vera suppliers in developing countries the most opportunities. The most prospective countries are France, the Netherlands, Italy, Germany, Spain and the UK. These countries have a robust natural health products industry and have some of the largest consumer markets in Europe. Southern European countries, such as Spain and Italy, are also producers of Aloe vera.

France

Table 3: Imports of vegetable saps and extracts with HS Code 130219 to France, 2015-2019

Source: Eurostat

France has one of the largest consumer markets in Europe. It is also an important trader of raw materials to Europe. The imports of vegetable saps and extracts with HS Code 130219 increased both in volume and in value from 2015 to 2019. However, most of the imports come from intra-EU trade, which accounted for 92 percent of all trade in 2019.

Sales of food supplements reached EUR 1.92 billion in France in 2018, according to Synadiet. This was an increase of 1.3 percent compared to the previous year. Almost half of these sales are from pharmacies (49.6 percent), followed by direct sales, such as e-commerce (18.7 percent), and then specialist retailers (15.5 percent), mainstream retailers (10.3 percent) and drugstores (5.9 percent). In the pharmacy channel, the best-selling products are those that improve digestion. The main market players in France include Ciel d’Azur Labs, Bioultime and Laboratoires Santé Verte.

Despite France being the largest importer of vegetable saps and extracts with HS Code 130219, the country relies heavily on imports from other European countries. However, France remains prospective, as it has a strong processing sector of health supplements. There is also high awareness of Aloe vera among French consumers.

In summary, France is a prospective market for suppliers of Aloe vera in developing countries. Demand for food supplements is increasing. There is also a growing market for organic products.

The Netherlands

Table 4: Imports of vegetable saps and extracts with HS Code 130219 to the Netherlands, 2015-2019

Source: Eurostat

The Netherlands is the leading importer of natural ingredients to Europe. Dutch imports of vegetable saps and extracts with HS Code 130219 increased in value and volume between 2015 and 2019. The USA is the main exporter of vegetable saps and extracts with HS Code 130219. Dutch companies that either import or produce aloe health products include Curaloe, Forward Farma BV and Beauty Pearl.

Dutch importers usually export to other European countries. Suppliers of Aloe vera in developing countries should target Dutch buyers, especially if they are capable of exporting large volumes of Aloe vera. The imports of vegetable saps and extracts with HS Code 130219 have grown significantly in recent years.

It is expected that demand for Aloe vera from the Netherlands will continue to increase in the coming years. The main driver is growing popularity of aloe-based health products in Europe.

Italy

Table 5: Imports of vegetable saps and extracts with HS Code 130219 to Italy, 2015-2019

Source: Eurostat

Italy has one of the largest consumer markets in Europe. It also has one of the most important markets for organic products. Figure 5 shows that imports of vegetable saps and extracts with HS Code 130219 increased by double-digit rates between 2015 and 2019. Most imports come from extra-EU trade, which accounted for 65 percent of all trade in 2019.

The Italian food supplements market was valued at EUR 3.5 billion in 2018. Around 83 percent of food supplements are sold in pharmacies. Important Italian market players are Optima Naturals, Prodotti Gianni, Zuccari, Vividus S.r.l. and ESI S.r.l. Domestic Aloe vera producers include Azienda Agricola Posenato Marco, Azienda Agricola Il Pucino, Desder Aloe and Ghigo Miranda.

VonDerWeid is a domestic producer of aloe health products. The company sources most of its Aloe arborescens or Aloe vera from Italy. ESI S.r.l. produces a wide range of aloe products, including health products. The company operates a production plant near Genova. Equilibira is one of the biggest Italian producers of health products. The company offers a wide range of health products based on Aloe vera. Syrio, part of Equilibira, is also a producer of pharmaceuticals and health products that contain Aloe vera.

Italy is a prospective country for exporters of Aloe vera in developing countries. Demand for organic products is also increasing in Italy. The market is growing because of rising consumer demand for natural products.

Germany

Table 6: Imports of vegetable saps and extracts with HS Code 130219 to Germany, 2015-2019

Source: Eurostat

Germany has the largest consumer market in Europe. It also has the largest market for organic foods. The market for organic foods has been increasing at a steady rate and is now the second largest in the world. Germany is the fourth leading importer of vegetable saps and extracts with HS Code 130219. It is shown that imports have been increasing at a double-digit rate between 2015 and 2019.

The nutritional supplements market in Germany was worth EUR 2.1 billion in 2018, according to IQVIA. Around 50 percent of the market comprises vitamins and minerals, while heart and cardiovascular supplements, supplements for pain-relief, muscles and joints and supplements that boost the immune system each make up 10 percent. The rest comprises probiotics and digestive system supplements, hair care, eye care and oral care supplements. This presents an opportunity for Aloe vera, because its properties are suitable for such products.

Ahlens-based LR Health & Beauty is a significant producer of Aloe vera products. The company uses Aloe vera in its natural and personal care products. LR Health & Beauty operates one of the largest processing facilities for Aloe vera in Germany. Other German importers include Hawlik BioImport GmbH, Denk Ingredients and VMP Chemiekontor.

Germany is a prospective market for Aloe vera suppliers in developing countries. There is high demand for high-quality and environmentally friendly products. German consumers are well aware of Aloe vera and its properties. You should target German buyers. Small and medium-sized buyers that focus on the natural sector, including health products and personal care products, may be more suitable for you as an exporter of Aloe vera in a developing country. Organic Aloe vera is also in demand on the German market. There is also a high demand for fresh Aloe vera leaves on the German market.

Spain

Table 7: Imports of vegetable saps and extracts with HS Code 130219 to Spain, 2015-2019

Source: Eurostat

Imports of vegetable saps and extracts with HS Code 130219 to Spain have been increasing between 2015 and 2019. Imports have increased most in terms of value. The imports of vegetable saps and extracts with HS Code 130219 do not represent only Aloe vera imports. Although the demand for aloe is growing on the Spanish market, there is also growing domestic production. However, most imports come from extra-EU trade, which accounted for 56 percent of all trade in 2019.

The Spanish nutritional supplements market was valued at EUR 920 million in 2018, according to the Association of Dietetic and Food Supplement Companies (AFEPADI). According to data from International Marketing Service (IMS) in Spain, the most-consumed food supplements in Spain in 2015 were:
- Vitamins and minerals: 24%;
- Supplements that regulate the nervous system, especially relaxants (plant extracts, melatonin, B vitamins): 9%;
- Digestive system supplements: 8%;
- Slimming or weight control supplements, such as herbal extracts: 6%;
- Laxatives, such as fibre and laxatives: 4%;
- Anti-inflammatories, such as collagen and magnesium: 4%;
- Diuretics: 1%;
- Hepatoprotective supplements: 1%;
- Supplements that regulate cholesterol, such as omega-3 acids, glucomannan, monacolin K: 1%;
- Others: 42 percent.

The Spanish digestive supplements market represents an opportunity for suppliers of Aloe vera in developing countries, as it is the third-largest segment in the Spanish food supplements market. Targeting this market is therefore worth considering, because Aloe vera has positive laxative properties.

There is also growing production of Aloe vera in Spain; important Spanish aloe producers include Uriach, Aloe Plus Lanzarote S.L. and 4Life Research. Domestic producers of aloe include NaturAspis Aloe Vera, Olaloe, Ibizaloe, Aloe Vera Farm Mallorca SL and Finca Canarias. Spanish production of Aloe vera is growing, and domestic producers generally do not source Aloe vera from developing countries.

Spain has a prospective market for suppliers of Aloe vera. However, you should ensure that you are able to compete with domestic suppliers. Exporters in developing countries should make sure the quality of their Aloe vera is comparable to Spanish Aloe vera. Spanish producers focus on organic aloe production. This is because most Aloe vera produced in Spain is for exports and processing in countries like Germany, France and the UK. Spanish Aloe vera producers usually sell Aloe vera leaves, as processing is done in other European countries.

Exporting processed Aloe vera extracts may be an opportunity for suppliers in developing countries. Spanish buyers that have clients across Europe are the prospective target group.

United Kingdom

Table 8: Imports of vegetable saps and extracts with HS Code 130219 to the UK, 2015-2019

Source: Eurostat

Figure 8 shows that the imports of vegetable saps and extracts with HS Code 130219 to the UK have increased at a double-digit rate between 2015 and 2019. The UK is an important consumer market in Europe. It also has one of the largest markets for organic products.

The UK supplements market was worth GBP 421 million in 2016, according to Mintel. Around 46 percent of British consumers take supplements on a daily basis. There is a growing demand for organic products in the UK. Pukka Herbs and Simplee Aloe are important users of organic Aloe vera. The leading health food chain, Holland & Barret, markets Aloe vera health products under its private label.

There are opportunities for Aloe vera juice and Aloe vera powder on the UK market for natural health products. Aloe vera juice is considered of higher quality in terms of nutritional content. The production of supplements, as well as the processing of aloe, takes place in the UK.

While the UK is one of the leading importers, Brexit (Britain’s exit from the European Union) may disrupt demand for raw materials, such as Aloe vera for health products – especially in the case of a no-deal scenario, where it may take some time to re-negotiate trade deals with countries. This is because supply chains are likely to be disrupted whilst trade negotiations take place, especially in the case of a no-deal scenario.

4. Which trends offer opportunities on the European aloe vera market?

There are several trends in the European health products market for natural ingredients such as Aloe vera. Perceptions of European consumers are changing and they are moving towards natural products when it comes to their health and well-being. There is also increasing European production of Aloe vera, which creates competition for suppliers in developing countries. Growing demand for high-quality ingredients and products generates demand for certified organic Aloe vera.

Changing perception of health and convenience

European consumers are increasingly looking at getting nutrients and vitamins via nutritional supplements, because of their convenience. Consumers are seeking natural ingredients such as Aloe vera because of their many health benefits; such ingredients are also perceived as a healthier and natural alternative to synthetic chemicals.

Thus, Aloe vera-based health products meet consumer demand for convenience. In addition, across Europe, food supplements have been in high demand since the COVID-19 outbreak, as they provide vital minerals and vitamins that can help protect the body from viruses. This demand for food supplements, healthy foods and natural products is likely to continue in the coming years.

Therefore, you should capitalise on this opportunity by targeting the European food supplements sector. Specifically, you should do this by approaching buyers of natural ingredients for food supplements and designing your marketing materials for this sector, for example by listing Aloe vera’s health benefits on your company website and marketing materials. However, do not make medicinal claims when approaching buyers in the European supplements industry.

Increasing production of aloe vera in Europe

Production of Aloe vera is increasing in Europe, and this is likely to continue in the coming years. For example, the International Aloe Science Council (IASC) reported receiving requests for assistance in setting up greater commercial cultivation and processing operations in European countries such as Spain, Italy and Greece. Thus, growing production of Aloe vera in Europe poses a threat to producers of Aloe vera in developing countries.

Several parts of Europe, such as the Mediterranean coast, Balearic Islands and Canary Islands have the ideal conditions for Aloe vera cultivation. European countries such as Spain have associations supporting the Aloe vera industry; they include the Canary Islands Aloe Vera Product Manufacturers Association and the Asocialoe, which groups together producers, processors and distributors in the Aloe vera sector.

Although they are far from self-sufficient in terms of their Aloe vera supply, European countries can offer a lot of advantages to buyers and processors in Europe. They can supply fresh leaves produced locally compared to developing countries that export processed products, such as aloe powder.

Exporters of Aloe vera in developing countries should therefore prepare by ensuring their Aloe vera is of high quality so they can compete with European producers. Ways to do this include joining IASC and its certification programme and meeting its requirements for the IASC Aloe Vera Quality Standard.

Growing demand for organic aloe vera

Quality and contamination are two major issues for European buyers, leading buyers to ask for high-quality and consistently uncontaminated Aloe vera. Thus, buyers are increasingly demanding certified organic products, because they are a sign of quality. At the same time, there is a growing market for organic products in the European market, a trend that is expected to continue.

Key factors driving increasing consumer demand for organic products on the European market include consumers seeing organic products as being of higher quality, safer and free of synthetic chemicals. Sales of organic products in Europe have been increasing since the COVID-19 outbreak; this trend is likely to continue. Consumers are buying organic products, as they look to boost their personal immunity.

Some industry experts suggest producers in developing countries should capitalise on this opportunity by getting EU organic certification for their Aloe vera. According to the feedback from the industry, there is a growing demand for organic Aloe vera on the European market. Natural & Organic Farms Mexico is an example of a company exporting both EU Organic and Ecocert-certified Aloe vera to the European market.

Figure 2: EU organic certification logo

Source: ec.europa.eu

Coronavirus Challenges

The COVID-19 pandemic poses several challenges to exporters who are seeking to enter the European market. Challenges exporters face are likely to remain for the foreseeable future, as different states and governments around the world attempt to tackle COVID-19 with emergency measures. Thus, COVID-19 poses a threat to exporters in developing countries looking to access the European market, as it disrupts global supply chains, making it more difficult to enter the European market.

Import and export restrictions on goods and quarantine and lockdown measures imposed by states and governments pose key challenges for exporters, as they have disrupted global supply chains. For example, some port authorities have forced ships carrying goods to observe 14-day quarantine periods. Lockdown measures have also limited economic activity, especially in the processing and packaging of agricultural products. The cost of exporting goods has also increased, and the cost of air freight has increased due to flight cancellations.

It is too early to state how long the coronavirus crisis will impact supply chains for agricultural products, including Aloe vera. However, business risks can be mitigated. You should check with government/trade ministries to request information on emergency measures in place because of COVID-19, as well as guidance on exporting. Exporters should also look at government websites of export countries to check their latest guidance and rules on imports. Freight and logistics companies should be contacted to check transportation and freight procedures. Finally, exporters should also stay in regular contact with their customers to inform them of possible delays and delivery times.

This study was carried out on behalf of CBI by Ecovia Intelligence.

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