According to the Secretariat of the Convention on Biological Diversity, global sales of herbal products totalled an estimated US $ 60 billion in 2002 and it is expected to get higher at 6.4 per cent average growth rate. This figure represents the world market for all plant-derived chemicals – pharmaceuticals, industrial ancillary products, pesticides, fragrances, flavours and colour ingredients.

As per the 1982 International Trade Classification (ITC) report, pharmaceutical applications of medicinal plant-derived products represented less than 20% of the total market for botanical products. According to this report it is not possible to assess the volume of or value of trade in all botanicals that are used medicinally because trade statistics do not identify medicinal and other uses separately.

Assessing all aspects of medicinal plant trade with certainty on a global level is difficult due to a number of reasons.

• Wide diversity of plants involved.
• Non-availability of accurate trade-related data on medicinal plants.
• Individual trade statistics of several hundred medicinal plants in commerce cannot be estimated as these are not itemized in national trade data. Only plants entering a country in very large quantities are listed individually.
• Available trade data does not distinguish between medicinal and other uses.
• Medicinal plants like liquorice have multiple uses ranging from flavouring a variety of products to stabilizing foam in fire extinguishers. This is in addition to its being used as an expectorant and anti-inflammatory.
• Products reported as medicinal plants include gums, spices, teas, infusions, insecticides and cosmetics.
• Essential oils such as mint oil, eucalyptus oil, cinnamon leaf oil etc. are used both in flavouring and as medicine.
• Large part of domestic trade is poorly classified and/or improperly recorded.
• Rising worldwide demand for medicinal plants has created a sustained and largely ‘underground’ trade in plant materials, most of which are collected in an unregulated manner.

According to Lewington (1993) the situation in medicinal plant trade is rather more complicated because of various levels of secrecy maintained by the traders and the complexity of the trade structure itself. According to ITC, medicinal plants come under Non-Wood Forest Products (NWFP) which are a heterogeneous group. Thus trade data based on compilation of items coded Standard International Trade Classification (SITC) 292.4, 292.41, 292.42 and 292.49 (Table 3.1) are indicative of products not only used for medicinal purposes but also as cosmetics, paints, dyes, insecticides and detergents. Of the over 3,000 botanical raw material species in global commerce the ITC report covers the most important exported natural products. Measuring the size of the sector is thus a challenge as there is no comprehensive and exhaustive listing of Hormonized Tariff Codes (HTCs) for Medicinal and Aromatic Plants (MAPs) and their extracts. For e.g., products under the SITC Revision 3 are classified into 10 sections, 67 divisions, 261 groups, 1,033 sub-groups; 720 sub-groups are further divided into 2,805 items providing 3,118 basic sub-groups. The SITC Rev 3 follows a 5-digit coding. Many countries are struggling with the lack of specificity of their tariff schedules and are looking to add more specific 8- and 10-digit codes for their most important botanical imports and exports. Even when national schedules of tariff codes are referenced by an enterprise, these lack the specificity to differentiate down to the botanical species level (using Latin binomials) and furthermore to the various processed forms of a species. In addition, natural botanical ingredients are not cohesively grouped within the current HTCs. A botanical ingredient may be classified by some exporters as a dried root or tuber, by others as a spice and by yet others as a medicinal substance.

 

Table 3.1 Plant-derived industrial products

S.No	Plant-Derived Product	Industrial Use
1	Essential oils	Perfumery, cosmetics, food, pharmaceuticals
2	Resins and balsams	Pharmaceutical aids besides other non-pharmaceutical uses
3	Fixed oils	Medicinal/nutritive/pharmaceutical aid
4	Fatty acids	Nutraceutical/soap/detergent making
5	Gums	Medicinal/non-medicinal
6	Condensed tannins	Medicinal/tanning
7	Saponins and surfactants	Chemical/pharmaceutical aids
8	Natural rubber	Rubber industry, automobile, aircraft, consumer products
9	Waxes	Pharmaceutical aid/other
10	Dyes	Edible/non-edible
11	Pesticides	Insecticides/herbicides/rodenticides
12	Industrial organic acids	Fine chemicals, textile, pharmaceutical and others
13	Cotton and other vegetable fibres	Textile, paper, pharmaceutical and others
14	Industrial starch	Textile, food, cement, paper and others
15	Food or food additives	Food, beverage and others

Based on import statistics of medicinal plants for the period 1987–1991, world trade in medicinal plants on an average is US $853,000. Total value of world trade in medicinal plants during 1991 was around US $1.08 million.

• China is the biggest producer as well as exporter of medicinal plants, accounting for 30% of total world trade (by value) in 1991, followed by Korea, the United States, India and Chile.
• China with exports of over 12,000 tonnes per annum and India with some 32,000 tonnes per annum dominate the international markets. Singapore and Hong Kong are the main re-exporters of medicinal plants in Asia. Japan, the United States, Germany, France, Italy, Malaysia and Spain are the major markets.
• Hamburg is the world trading centre in medicinal plants.
• About 53 countries supply medicinal plants to Germany of which important ones are India, Argentina, former Yugoslavia, Greece, China, Poland, Egypt, Hungary, Czechoslovakia, Zaire, Albania, Netherlands and France.
• 400,000 tonnes of medicinal plants with an average market value of US $1 billion are imported into Europe from Africa and Asia.
• According to IUCN/WWF (IUCN-WWF, 1988) sources, the annual turnover of plant-derived pharmaceuticals industry in the United States is US $10 billion.
• North America is an important region for medicinal plant trade with retail sales of herbal medicine industry in 1994 at an estimated US $1.6 billion.
• There is a significant demand for medicinal plant material in North America which is a fast growing market. Eastern Europe and Asia supply most of its needs and in the last five years, demand in North America for Chinese medicine, Indian herbs and Latin American crude drugs is also significant.
• Traditional medicine is an important part of African culture and 80% of Africans rely on plant-based medicine.
• About 70% to 90% of the population in South Africa, Zambia, Nigeria, Mozambique, Ethiopia and Democratic Republic of Congo among others rely on traditional medicine for their health care.
• In South Africa on a national level 20,000 tonnes of medicinal plant materials are traded, corresponding in value to US $60 million.
• In Zambia, trade in traditional medicine is worth US $43 million per annum. Medicinal plant-based therapies also play a significant role in most Latin American countries. 70–80% of the population rely on such therapies and there is a lack of access to modern drugs in a significant part of Latin America.
• Developing countries with a long tradition of use of medicinal plants such as China, India, Republic of Korea, Thailand, Brazil and Chile are major exporting countries of plant raw materials.
• China and India are two of the world’s largest markets for medicinal plants, but are not the largest traders. This is because markets in developed countries, especially Europe and the United States, are highly regulated and difficult to penetrate because of stringent test requirements for plant material by the pharmaceutical manufacturers of developed countries.
• As a result developing countries tend to export unprocessed or slightly processed materials, while developed countries undertake mass production of finished products thus becoming dominant exporters of finished products.
• Thus in absolute terms, developing and developed countries import similar values of medicinal plants. For e.g. 80% of Indian exports constitute raw materials, including dried plants, extracts and isolated ingredients, while finished herbal products mostly homeopathic and Ayurvedic medicines account for only 20%.
• Chief herbal drug importing countries by value are China, Hong Kong, United States, Japan and Germany. Germany is a leading importer and its pharmaceutical companies are major players in the world market.

Out of the global market of US $60 billion a year, as per an estimate in 1991, the herbal product market in European countries was about $ 6 billion, with Germany accounting for $ 3 billion, France $ 1.6 billion and Italy 0.6 billion while in other countries it was 0.8 billion. In 1996, the herbal product market in European countries was about $ 10 billion, in the United States $ 4 million, in India about $ 1.0 billion and in other countries $ 5 billion. In 1997 the European market alone reached $ 7 billion. The German market corresponds to about 50% of the European market, about $ 3.5 billion. This market is followed by France, $1.8 billion; Italy $ 700 million; the United Kingdom, $ 400 million; Spain 4 300 million; the Netherlands, about $ 100 million.

According to a 2009 study by BCC Research, the global market for botanical and plant derived drugs is expected to increase from $ 19.5 billion in 2008 to $32.9 billion in 2013, an annual growth rate of 11%. In terms of volume global exports and imports of medicinal plants has been increasing, although the total value has been declining, suggesting falling average unit prices.