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The global specialty chemicals market generated a revenue of $582.3 billion in 2017, and is projected to reach $782.2 billion by 2023, progressing at a CAGR of 5.1% during the forecast period (2018–2023).
APAC is expected to witness the fastest growth in the industry during the forecast period. This can be mainly attributed to the rapidly growing population in the region, owing to which there is increasing demand of construction chemicals, lubricant and oilfield chemicals, and electronic chemicals. There is increase in demand of smooth functioning lubricants to prevent equipment failure, where, the lubricant and oilfield chemicals category is expected to hold 10.9% revenue share in 2023.
Factors Governing Specialty Chemicals Market
The major trend observed in the specialty chemicals market is the shifting of production base to the APAC region. This can be ascribed to the stringent environment norms in Europe, North America and other regions, expensive labour cost, and reducing profit margins. Whereas, APAC is a hub of agricultural activities, moreover, a hub of chemical manufacturing units, and comparatively a low-cost location. For instance, in 2016, Akzo Nobel N.V. opened a new specialty chemical plant in China. The company invested more than $442.7 million. Considering all these factors, various companies are shifting their manufacturing bases to APAC.
The middle-class population is growing rapidly in emerging economies namely, China, India, and Brazil coupled with increased disposable income there is rise in demand of food, agriculture, cosmetics, electronics, textile and many other products which is creating the demand of specialty chemicals in end use industries. For instance, in 2014, India launched ‘Make in India’ initiative, that has enhanced the competitiveness of the chemicals sector in the country, by permitting 100% foreign direct investment (FDI) and de-licensing the manufacturing of most chemicals. Consequently, all these factors are driving the growth of the specialty chemicals market in emerging economies.
Specialty chemicals play an important role in the development of bio-degradable and eco-friendly products. Green chemicals such as 1-Arabinose, 1-heptacosanol, 1-nonacosanol and many others, are developed to reduce the harmful environmental impact of chemicals. They are used in various applications including the production of fabrics which require less water to wash, paints with low volatile organic component (VOC) content, and chemical additives that help in enhancing the physical properties of products. Owing to all these factors, there is ample opportunities for the market players operating in the specialty chemicals market.
Segmentation Analysis of Specialty Chemicals Market
Agrochemicals category held the largest specialty chemicals type in the global market, generating a revenue worth $82.1 billion in 2017. This can be attributed to the increasing food consumption worldwide owing to the increasing population, and increasing need of crop protection, in order to meet the ever-increasing demand of food products.
Geographical Analysis of Specialty Chemicals Market
APAC was the largest market for specialty chemicals during the historical period and is expected to maintain the trend during the forecast period as well. This can be mainly attributed to the increasing demand of specialty chemicals in the region to fulfil the growing demand from end use industries.
Besides, APAC is expected to witness the fastest growth during the forecasted period, mainly on account of increasing demand for residential, and commercial buildings coupled with growing urban population is accelerating the growth of construction chemicals in the region.
During the forecast period, China is expected to lead the APAC region, generating revenue worth $198.1 billion in 2023.
Competitive Landscape of Specialty Chemicals Market
Some of the key players operating in the specialty chemicals are Ashland Global Holdings Inc., DowDuPont Inc., Evonik Industries AG, Akzo Nobel N.V., Eastman Chemical Company, LOTTE Fine Chemical, Mitsui Chemicals Inc., China Petrochemical Corporation, Saudi Basic Industries Corporation (SABIC), and Mitsubishi Chemical Corporation.
Recent Strategic Developments of Major Specialty Chemicals Market Players
In recent years, key players in the specialty chemicals market have taken several strategic measures such as product launches and geographical expansions to gain a competitive edge in the industry. For instance, in April 2018, DowDuPont Inc. announced to invest $100 million in the expansion of manufacturing facility at Sabine River Works plant in Orange County, Texas (U.S.) to meet the growing demand in specialty chemicals. The specialty materials produced at the plant include product lines Surlyn, Nucrel, Fusabond, and Vamac (used in consumer goods and transportation).
Moreover, in October 2017, Huntsman International (India), the subsidiary of Huntsman Corporation, announced plans to manufacture more types of specialty chemicals in India, which will be consumed locally as well as exported to the markets of the Middle East and Africa. This will help the company in expanding its customer base.
Market Size Breakdown by Segment
The Specialty Chemicals Market report offers comprehensive market segmentation analysis along with market estimation for the period 2013–2023.
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Key Questions Addressed/Answered in the Report