Specialty And Fine Chemicals

Specialty and Fine Chemicals

Specialty and fine chemicals are products that are sold on the basis of their function or performance, over composition. These chemicals can either be single entity chemicals or specially composed formulations, which increases the performance of the end product.

According to Insights and Reports, China is the largest consumer of specialty and fine chemicals, accounting for more than 30% of the global consumption. However, the global consumption of specialty and fine chemicals witnessed a slowdown in 2016, compared to the previous year due to the economic slowdown in China, recession in several countries in Latin America, and the slowdown in the oil and gas and mining industries. Post a meager 1% growth in 2012, the specialty and fine chemicals industry made a rebound during the period of 2014-2015, with industry growing at 4% annually during that period. China, India and Japan are expected to record a significant growth in the coming years maintaining a growth of 7%-9% annually.

Construction chemicals, electronic chemicals, specialty polymers and surfactants captured more than 40% of the market in 2016. Further, food and beverages, personal care, electronics and construction are the key application areas of specialty and fine chemicals, capturing more than 60% of the market in 2016. The growth of the specialty and fine chemicals industry witnessed a shift in focus from the developed economies such as North America and Europe to the developing economies in Asia Pacific and, primarily due to strengthening economic conditions, transition in the standard of living and low labor costs. Further, the demand for specialty and fine chemicals look favorably optimistic in the Middle East due to cheap availability of petrochemical feed stocks.

The specialty and fine chemicals industry is expected to maintain a positive growth trajectory in the coming years due to the expanding automotive and electronics industry. These industries are shifting their focus to the developing nations such as India and China on account of raw material abundance, and cheap labor costs among others, which in turn is expected to show a positive impact on the specialty and fine chemicals industry in the coming years.

According to Insights and Reports, global volume consumption of specialty and fine chemicals is expected to maintain a steady growth of 3.5% annually till 2022. The developed nations are expected to witness growth of 2.5% annually till 2022 due to debt constraints, and stringent fiscal policies. However, volume consumption of specialty and fine chemicals in the developing nations is expected to record a higher growth in the coming years. For instance, China is expected to grow at an excess 6% annually in the coming years due to rising industrialization.

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