The global isocyanates market is expected to witness substantial growth on account of increasing demand from construction and automotive industries. Isocyanate on reaction with alcohol (hydroxyl group) produces polyurethane polymers that are extensively used in various end-use industries. Isocyanates are manufactured by treating amines with phosgene. Increasing demand in construction industry owing to its highly reactive chemical property is anticipated to be a key factor driving the global market growth. They are utilized in the production of rigid foams, adhesives, elastomers and coatings. Potential application of these products in end-use industries such as automotive and electronics is anticipated to further complement its global demand over the forecast period. They are used as insulators in electronic industry and as vehicle exterior to reduce vehicle weight in automotive industry. Increasing polyurethane consumption in various consumer and industrial applications is expected to augment the global market over the foreseeable future. Bio based isocyanates development is anticipated to further drive the global market growth. The chief factor driving the global market is the growing end use segments for polyurethane industry. Isocyanates are extensively being used in paints & varnishes, flooring materials and decorations in housing industry. Additionally, increasing demand from furniture industry as carpet cushion and mattress padding is anticipated to exponentially boost isocyanate market over the forecast period.
On the basis of types the global market can be classified into methylene diphenyl diisocyanate (MDI), toluene diphenyl diisocyanate (TDI), and aliphatic isocyanates. MDI is the major isocyanates type segment. Aniline is treated with formaldehyde to produce diphenylmethanediamine (MDA). MDA on treatment with phosgene produces MDI. MDI is majorly used for producing rigid foams. MDI utility is predicted to grow at a rapid rate in the upcoming years owing to its use in refrigerators, freezers and for manufacturing seats & vehicle interiors. Major applications include flexible foams, rigid foams, paints & coatings, adhesives & sealers and elastomers & binders. Widespread flexible foams utility in cushions, beddings, furniture & packaging industry is expected to further complement isocyanates market growth. Coatings are used as protection against corrosion and UV radiations. Extensive adhesives and sealants usage as wood rocking glue in the construction industry is projected to foster the global market growth over the forecast horizon.
Highly volatile crude oil pricing is a major factor restraining the global market growth over the forecast period since crude oil is used to produce MDI and TDI. Highly toxic and hazardous nature coupled with heavy polyurethane dependency on fossil fuels can impede global isocyanates market growth. Moreover, use of certain polyurethanes coatings, adhesives and foams lead to occupational asthma, this factor is further anticipated to hinder the market growth over the forecast horizon.
Asia Pacific is expected to witness significant growth over the forecast period with majority of demand driven by China and India. Growing end-use industries such as construction, electronics and automotive in emerging markets of China and India is expected to further complement Asia Pacific market growth over the forecast period. North America is expected to register moderate demand over the forecast period primarily due to increasing regulatory intervention from agencies such as EPA regarding environmental and health effects associated with MDI and TDI. Europe is anticipated to grow at a sluggish rate on account of stringent environmental regulations and low growth in end-use industries.
Global isocyanates market is moderately consolidated with major companies vying for leadership position through capacity expansions in Asia Pacific. For instance, Vencronex started expansion of its aliphatic isocyanate plant in Thailand which is expected to be operational by 2016. Major companies are involved in R&D, innovation, capacity expansion and geographic expansion to penetrate existing markets and to enter new markets. Key participants operating in the global market include The Dow Chemical Company, Huntsman Corporation, Anderson Development Company, Yantai Sanjiang Chemical Industry Material Co., Ltd., BASF SE and Bayer MaterialScience.
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Demand across the organic chemicals sector shall register a slump in growth albeit increasing demand for certain chemicals that find end applications in healthcare and food. Furthermore, China, a major supplier of chemicals to the world, registered a considerable decline in manufacturing in the first quarter of 2020, following the trajectory unfolded by COVID-19's escalation to a pandemic. This has led to an imbalance in supply-demand dynamics, forcing manufacturers and customers alike to renegotiate supply agreements. The report will account for Covid19 as a key market contributor.