The global oud wood chips market (also known as agarwood chips) is a rapidly growing industry, projected to reach between US$ 75.6 billion and US$ 91.3 billion by 2034, driven by demand in luxury fragrances, traditional medicine, and e-commerce.
Market size and growth projections
2024 Market Size: Approximately $40 billion to $44 billion.
2034 Market Size: Projected to be between $84.91 billion and $91.3 billion.
CAGR (2025-2034): Estimated to be between 7.51% and 7.6%.
Market drivers and scope
Perfumes and fragrances: Increasing demand for natural and luxury fragrances is a major driver.
Spiritual and cultural use: Agarwood is used in religious ceremonies and rituals, particularly in the Middle East, East Asia, and Southeast Asia.
Wellness and aromatherapy: Growing interest in natural, therapeutic ingredients for aromatherapy and traditional medicine fuels market growth.
Premium and high-end products: The market is shifting towards higher-grade, premium agarwood chips, driven by growing consumer awareness in regions like China.
Regional analysis
North America: Holds the largest market share, driven by demand for premium fragrances and supportive regulations.
Asia-Pacific: The fastest-growing region, fueled by a large consumer base, traditional cultural practices, and a rising middle class.
Europe: Shows steady growth due to increasing interest in aromatherapy, perfumery, and sustainable products.
Middle East and Africa: A promising market with high-end demand for oud-based luxury products and incense due to cultural significance.
Distribution and applications
Application: The “oil production” segment held the largest share in 2024, driven by the demand for agarwood oil in perfumes and wellness.
Distribution Channel: “Indirect channels” (retail and online networks) dominated the market in 2024.
