Essential oils for cosmetics in the Netherlands Dutch imports from developing countries are large, in comparison to other EU countries. Due to large imports and re-exports, the market for essential oils is likely to continue its upward momentum, despite a small local production and more difficult period, due to the current economic downturn.

The Netherlands – A key trader of essential oils Although the cosmetics market in The Netherlands is quite mature, the size of the

cosmetics industry is limited. It accounts for only 4% of the total EU cosmetics market (€ 107 million), and was ranked 10th on the list of EU cosmetics producers.

The Dutch cosmetics industry decreased in size in the last few years, with a large part of cosmetics is imported into The Netherlands from production facilities of multinational companies in other EU countries. Except for Unilever, there are no large cosmetics manufacturers active in The Netherlands.

In the coming years, the Dutch market for natural and organic certified cosmetics is likely to increase. Therefore, the industrial demand for natural ingredients, including essential oils, is expected to continue to increase. However, compared to other north-western European countries, the market is small.

In 2008, The Netherlands was the third largest importer of essential oils and oleoresins, accounting for 9.2% of total EU imports. Between 2004 and 2008, imports increased by 5.1 (value) and -5.1% (volume), amounting to €75 million or 11 thousand tonnes.

Dutch imports from DCs are large in comparison to other EU countries (69% of total imports). Brazil, Indonesia, Argentina, India and China are among the largest supplying countries to The Netherlands.

In terms of specific products, The Netherlands mainly imports orange oil (€ 14 million / 6.4 thousand tonnes) and lemon oil (€ 11 million, 0.5 thousand tonnes).

The Netherlands is a main (re-)exporter of essential oils in the EU, accounting for 19% of total EU exports in 2008. Exports amounted to € 49 million or 8.0 thousand tonnes in that same year. The main destinations are Germany, Spain, Ireland, Italy and the UK.

Buyer requirements for essential oils are provided in the module on ‘Compliance with EU buyer requirements’.

Understanding the Dutch market The Netherlands is the third leading importer of essential oils and is a large re-exporter of essential oils,

is therefore an important point of entry for suppliers in DCs. The size of the cosmetics industry in The Netherlands is limited. In fact, a large part of cosmetics is imported into The Netherlands from production facilities of multinational

Essential oils for cosmetics in the Netherlands

companies in other EU countries. Industry sources state that, except for Unilever, there are no large cosmetics manufacturers active in The Netherlands. Several processors and traders are located in the country, adding to domestic demand for essential oils. A large part of imported essential oils are re-exported to other EU countries. The Netherlands has become a major trade centre for essential oils in the EU, having the port of Rotterdam and its advanced facilities as a hub for incoming and out coming supplies. Demand of other EU countries will affect the demand of Dutch traders, therefore, higher demand for natural, organic, fair-traded essential oils from outside the country, will lead to an increase in the Dutch demand for these oils. Market entry The recommended market entry strategy depends on the offered essential oil, whether being an existing

oil in the market or a new oil. The two strategies can of course overlap. Trade channels for new essential oils The most interesting trade channel for exporters in DCs dealing with existing essential oils, meaning oil already known to the market, will be importers/ traders and processors. Dutch importers/traders supply cosmetics manufacturers and perfume houses. As they have strong ties to the cosmetics producers they can promote and support your products. Manufacturers of final products tend to purchase from intermediaries rather than purchase directly from suppliers in DCs, although due to the fact that essential oils can be sold in small volumes some manufacturers may be interested in direct purchasing. Please note that big companies like IFF or Givaudan have their own sources. Processing companies add value to essential oils before selling them to the end-product manufacturers. Current tendency shows that EU buyers, particularly perfumery manufacturers, are also increasingly looking for fractions of essential oils, in which the required properties are isolated. Exporters in DCs must compete on quality, price and reliability. Chances of successful market entry are larger, if the exporter offers a product that can be distinguished from other products that already are available on the market. Factors like availability of the oil, price, history of use in the country of origin (story telling) and quality (purity, no adulteration!) are of major importance. However, meeting standards such as ISO, IFRA, organic, FSC, Fair Trade and FairWild is an added value and will strengthen the position of the exporter, especially with considerations about the sustainability of the plants. Essential oils are commonly sold on the basis of their origin. However for some downstream users the origin is not critical. Hence exporters could consider opportunities to develop an alternative origin for an essential oil, taking account of legislation on access to plant species and the quality, price and reliability of the final essential oils. Trade channel for new essential oils Exporters in DCs, who are interested in launching new essential oil in the market, are recommended primarily to trade in existing oils in order to build up a reliable relationship with the Dutch importer and to gain experience of the industry. There are considerable challenges to introduce a new essential oil that should not be under estimated. New essential oils are primarily of interest if they offer a new fragrance and hence is of particular relevance to the perfume sector. An importer may be able to guide the exporter in introducing a new oil to the market, which is a difficult process, due to complications concerning strict EU regulations, especially if volumes exceed certain minimum thresholds. It is estimated that the whole process can take about 1 to 2 years before a new essential oil can be traded in the market; Exporters need to pay attention to the sustainability of the

Essential oils for cosmetics in the Netherlands

plant species when developing new essential oils as well as ensuring that sufficient quantities are available for a viable business. The following channels are especially relevant for producers of new essential oils: Large companies with screening programmes sub-contract brokers, research

institutions, and other intermediaries. These intermediaries collect samples in a similar way as for the pharmaceutical industry, but with greater emphasis on traditional use, and an eye towards raw material sourcing strategies, which are of immediate concern to companies in the personal care and cosmetics industry.

Specific research and training centres specialised in extraction and purification processes, offering services to companies involved in the food industry, pharmaceuticals and cosmetics.

Since quality demands for cosmetic ingredients are very high, joint ventures or other forms of partnership are popular and increasingly necessary to be able to surmount issues, such as costly safety tests.

Interesting contacts Dutch importers search for new suppliers in DCs by visiting the country of interest, through recommendations, and a limited number also through trade fairs. The most common ways for developing country exporters to approach Dutch customers are through direct (e)mail, personal visits (as follow-up), inviting potential Dutch customers to visit them in their country, building your network and visiting international trade fairs. Interesting companies focusing essential oils for cosmetics are: Budelpack - http://www.budelpack.com - the EU’s leading personal care contract

manufacturer CHI - http://www.chi.nl natural cosmetics De Ambachtelijk - http://www.deambachtelijke.nl - oldest Dutch natural cosmetics

producer De Cruydhof - http://www.cruydhof.nl plant extracts and natural cosmetics

products Dr. van der Hoog - http://www.dr-vanderhoog.nl - cosmeceuticals and natural

cosmetics IFF - http://www.iff.com fragrance producer J. B. de Lange - http://www.grondstoffenkruidenier.nl - cosmetic ingredients

wholesaler Jan Dekker International - http://www.jandekker.com - cosmetics ingredients Van Nature Beter - http://www.vannaturebeter.nl - natural and organic cosmetics Other alternative points of departure in searching for more information and trading opportunities on the British market for essential oils is the International Federation of Essential Oils and Aroma Trade (IFEAT) - http://www.ifeat.org. An excellent reference for the trade of essential oils is the European Federation for Essential Oils (EFEO) - http://www.efeo-org.org/ export market. Also, the International Fragrance Association (IFRA) - http://www.ifraorg.org/- is useful to find information. Other interesting sites to visit for additional information, especially current trade leads and companies, are the following market places or buyer guides: http://www.ingridnet.com and http://www.herbworld.com. Greentrade - http://www.greentrade.net, an online marketplace serving as an important reference point for organic products is of interest.

Essential oils for cosmetics in the Netherlands

Assistance with market entry can also be sought through local business support organisations, import promotion organisations such as CBI and branch organisations focusing on the cosmetics, natural cosmetics and natural ingredients sectors. Netherlands trade associations which could be of interest are NOFOTA; Netherlands

Oils, Fats & Oilseeds Trade Association (http://www.nofota.com), the Dutch Cosmetics Organisation (http://www.ncv-cosmetica.nl) and the Club of Oils and Fats (http://www.oilsfats.nl). BDIH organises some of specialised natural cosmetics producers (http://www.bdih.nl).

Interesting trade press in The Netherlands is only published in Dutch. Kosmetiek (http://www.kosmetiek.nl) is of interest.

No trade fair of interest is held in The Netherlands.