The phosphoric acid market size is expected to advance at a CAGR of 4.1% during 2022–2030, to reach USD 63,186.8 million by 2030. This is ascribed to the rise in the fertilizer demand and increase in the consumption of this chemical in the food and beverage industry.
The rising application of phosphoric acid in the manufacturing of fertilizers and feed additives makes the chemical important in the agriculture sector. Moreover, it is used to acidify foods and beverages, especially cheese products, jams, and colas, to offer them a tangy and sour taste. Moreover, it is used to produce derivatives, many of which are widely used for removing rust from iron and steel.
According to the United Nations, with around 83 million people being added annually to the global population, the earth is projected to be home to 8.6 billion humans in 2030 and 9.8 billion in 2050. With this, the demand for food is expected to double in the coming years.
However, achieving a constant food supply for this escalating population has become a challenge, as owing to the rampant industrialization and urbanization, the arable land in several nations has started declining. According to the World Bank, the per capita arable land declined from 0.22 ha in 2000 to 0.18 ha in 2018.
Additionally, in many countries, the land owned by someone is divided equally among their children, which further creates a dent in the land area available to every offspring. This worsens the strain on farmers and impels them to use the existing arable land more efficiently and extensively, to raise the yield. This can be achieved if the soil remains fertile for longer periods, which prompts the usage of phosphate fertilizers.
North America and Europe are expected to register significant growth due to the booming demand for phosphoric acid for animal feed and for removing mineral deposits, cement smears, and hard water stains in the construction industry.
Moreover, the rising agricultural activities, government support to allow farmers to avail the compound at lower less prices, and the high-volume utilization of the chemical in the production of fertilizers in the developing countries of APAC, LATAM, and the MEA strengthen its consumption.
For instance, in June 2022, the United States Agency for International Development (USAID) approved around USD 331 million in funding in humanitarian and long-term development assistance, to tackle food security and resilience in LATAM and the Caribbean. This funding comprises more than USD 198 million for emergency food security programming and related assistance, including nutrition, health, and protection, as well as water, sanitation, and hygiene interventions.
Another USD 132 million has been sanctioned under the Feed the Future program, which, subject to Congressional approval, will be used to provide resources to help smallholder farmers in Colombia, Guatemala, Haiti, Honduras, and Peru ameliorate the productivity of high-value horticulture crops, augment incomes, and increase their capacity to handle shocks such as the high fertilizer prices and impacts of climate change. The resulting increase in the production of crops is projected to inflate phosphoric acid market sales revenue with a rise in the consumption of phosphate fertilizers.
The APAC phosphoric acid market outlook for 2030 is of approximately USD 28 billion, which would be a significant gain from its value in 2022. APAC is also expected to account for a sizeable portion of both the production and consumption of phosphoric acid worldwide. The decreasing arable land availability in rural areas will increase the need for fertilizers, which will, in turn, accelerate the expansion of the industry. Hence, due to their growing populations, China and India will dominate the production of phosphoric acid in the coming years.
The most-significant market players are PhosAgro Group, Nutrien Ltd., Indian Farmers Fertiliser Cooperative Limited, EuroChem Group AG, Prayon S.A., ICL Group Ltd., Yara International ASA, OCP Group, and Spectrum Chemical Mfg. Corp.