Trade uncertainty caused by geopolitical conflict and tariffs is disrupting the supply of natural ingredients into the American cosmetics industry. Ecovia Intelligence finds operators are responding by diversifying their supply bases and reformulating products. The adoption rate of sustainable ingredients made using new technologies is also expected to rise.
The natural cosmetics industry has been disproportionately affected due to its intricate supply networks, which provide a diverse range of raw materials. Some natural ingredients are grown in regions with highly concentrated or unique production. Many of these raw materials are not produced in the US. For instance, almost all natural essential oils are imported, often from developing countries. Essential oils and plant extracts from India and China have been particularly affected by American tariffs.
The current Gulf conflict is affecting the supply of gum arabic, frankincense, myrrh, and other aromatic chemicals sourced from the Middle East and North Africa. Importers are reporting disruptions, including longer transportation times and higher costs. A continuation of the conflict is likely to impact harvests, processing, export capacity, and shipping costs.
Since last April, when Trump-era tariffs were first introduced, operators have reported higher prices for raw materials and packaging. In addition to natural ingredients, many specialty chemicals and packaging materials are sourced from Asia.
Tariffs were introduced to encourage companies to reshore production. However, the natural cosmetics market is characterised by a large number of small- and medium-sized brands. Non-American brands, such as Jurlique and Dr. Hauschka, are often unwilling to establish additional manufacturing facilities for the US market, while many American indie brands struggle to find domestic contract manufacturers willing to handle small order quantities.
Trade uncertainty driven by tariffs and the Iran conflict is having unintended consequences. It is stifling innovation, as some cosmetic companies are reluctant to experiment with natural ingredients that carry supply chain risks. New product development is also being affected, with brands relying on a narrower range of raw materials. Some companies are already reformulating by replacing imported ingredients with those that can be sourced regionally.
Transparency is becoming increasingly important in ingredient supply chains. Importers are demanding more information from suppliers, including origin traceability, Certificates of Analysis (COA), and safety data. Sustainability certifications such as RSPO are also becoming more sought after. Additionally, new regulations—such as the EU Deforestation Regulation and the EU Corporate Sustainability Due Diligence Directive—are playing a role.
Ecovia Intelligence predicts that trade uncertainty will continue to affect the supply of natural ingredients in the coming years. Importers are expected to diversify their sources so they are less dependent on concentrated supply. There will likely be a greater emphasis on regional sourcing to protect against global supply and transportation shocks.
Adoption of sustainable ingredients made using new technologies is expected to increase. Companies such as Melt & Marble and ÄIO are using precision fermentation to produce vegetable oils and butters in bioreactors. Other firms are utilising biotechnology to create animal-free ingredients such as squalene, collagen, and peptides for the cosmetics industry. Plant cell technology is also being used to develop natural actives. Adoption rates of these sustainable ingredients are expected to rise as brands seek to reduce supply chain risks and mitigate price volatility.
Sustainable Cosmetics Summit
We shall discuss the impact of trade uncertainty on ingredient supply chains, as well as emerging sustainable materials, at the Sustainable Cosmetics Summit. The 17th North American edition will take place in New York on 21-22 May.
Speakers are from Responsible Sourcing Partnership, Innersense Organic Beauty, Croda Beauty, Melt & Marble, Lubrizol, ÄIO, Custom Essence, Wholechain, Lenzing, AAK, KKT Innovation Labs, Inolex, Kensing Solutions, L’Occitane en Provence, BioTara, Hairstory, Bansk Beauty, Sonsie Skin, etc. More details are on the website
Posted: April 13th 2026
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