Specialty Chemicals Market Size, Share, Industry, Forecast and outlook (2024-2031)

Global Specialty Chemicals Market is segmented By Type (Adhesives & Sealants, Cosmetic Chemicals, Dyes, Inks, & Pigments, Construction Chemicals, Food Additives, Industrial Manufacturing & Institutional Cleaners, Foundry Chemicals, Electronic Chemicals, Lubricants & Oil Additives, Oilfield Chemicals, Rubber Processing Chemicals, Textile Chemicals, Water Treatment Chemicals, Specialty Polymers, Plastic Additives, Paints & Coatings, Mining Chemicals, Flavors & Fragrances, Pharmaceutical Chemicals), By End-user (Automotive & Transportation, Building & Construction, Aerospace & Defense, Agriculture, Industrial Manufacturing, Food & Beverage, Electrical & Electronics, Consumer Goods, Others) and By Region (North America, Latin America, Europe, Asia Pacific, Middle East, and Africa) – Share, Size, Outlook, and Opportunity Analysis 2024 - 2031

Specialty Chemicals Market Size

Global Specialty Chemicals Market reached US$ 682.7 billion in 2023 and is expected to reach US$ 1,008.7 billion by 2031, growing with a CAGR of 5.0% during the forecast period 2024-2031.

Ongoing efforts to expand the range of applications for specialty chemicals will be the key to unlocking future growth opportunities for the global market. Many companies are looking to venture into the specialty chemicals sector. In March 2023, Murugappa Group, received board approval to venture into the production of specialized agrochemicals for crop protection applications. 

Volatility in supply of precursor materials is likely to become a major factor in hindering global market growth during the forecast period. With multinational companies increasingly pulling out investments from China, there could be a brief period when the global market is deprived of China’s low costs and high production capacity. A steep increase in prices would be a highly undesired outcome for many chemical producers.

Market Summary

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Market Dynamics

Growing Global Demand for Agrochemicals

Due to the growing population and rise in food consumption, agrochemicals are becoming increasingly necessary for enhanced crop protection and production, causing the market to expand over the forecasted years. Farmers' growing awareness regarding the usage of agrochemicals in farming is causing the market to grow.

A loss in agricultural land due to higher urbanization and industrialization leads to a growing need for agrochemicals to raise crop yield per acre of land, driving the market growth throughout the forecast period. Government incentives for farmers, including the institution of subsidies for purchasing agrochemicals will also become a major factor in raising market demand. 

Diversification of Applications in Emerging Economies

To give items or substances the intended effect, specialty chemicals are added. Therefore, specialty chemicals find employment across various end-use sectors, including consumer products, packaging, food processing, automotive and pharmaceuticals, due to their numerous properties and compatibility with many other chemicals and substances. For instance, specialty chemicals are widely utilized as fuel additives to improve the quality of gasoline in the automotive industry. 

Similarly, many lotions and creams use specialized compounds, such as methyl oleate, as active medicinal ingredients. Due to these countries' rapid industrialization and urbanization rates, specialty chemicals are predicted to have a strong market in emerging economies like India, Brazil and China. Additionally, urbanization has significantly increased people's living standards and purchasing power in these nations.

Difficulty in Procurement of Raw Materials

After the COVID-19 pandemic, one of the main obstacles for manufacturers of specialized chemicals is acquiring raw materials. Before the start of the pandemic, the majority of producers in the specialty chemicals market relied on China for the supply of raw materials. Manufacturers are reducing their reliance on China as a source of raw materials because of concerns about future uncertainty from the country since it is where the virus originated.

To procure raw materials, manufacturers are expected to use the ‘China+1’ hypothesis (different sourcing techniques). However, as viral transmission spread to many countries throughout the world, it has become crucial for producers to pinpoint alternative supply possibilities. There is a possibility of scarcity in the production of raw materials after COVID-19.

Market Segment Analysis

The global specialty chemicals market is segmented based on type, end-user and region.

New Pharmaceutical Breakthroughts Will Augment Market Growth

The majority of the market share is anticipated to belong to pharmaceutical chemicals. The wide range of the pharmaceutical industry explains its uses, including the creation of medications for Hughes syndrome, skin conditions and cardiovascular ailments. Pharmaceutical ingredients are essentially the active components found in pharmaceuticals.

It is created from fundamental chemical compounds in sizable reactors at various manufacturing facilities. Currently scientists are pursuing new breakthrough drugs for treating Alzheimer’s, leukemia and other chronic diseases. The base or chemical compound is transformed following intermediary processing and thus creates the medicinal ingredient in the end. 

Market Geographical Share

Asia-Pacific Will Have the Largest Market Share During the Forecast Period

Due to important emerging economies like China, India and Japan in this region, which recorded the greatest market share in the specialty chemicals industry, Asia-Pacific is predicted to have the largest market share overall. For international investors, the region offers significant investment options. Due to China's position as one of the top manufacturing hubs for most industries, including pharmaceuticals & nutraceuticals, personal care & cosmetics, automotive and electrical & electronics, Asia-Pacific has emerged as one of the world's fastest-growing markets for specialty chemicals.

Furthermore, the market for specialty chemicals is anticipated to offer attractive prospects due to the economies of Singapore, Malaysia, Thailand and India's increasing industrialization & diversification. Another factor driving the expansion of the specialized chemicals sector in India is the unprecedented use of chemicals for water treatment. Trade liberalization, rising demand for electronics, improvements in process technology and rising standards of living in most developing nations all contribute to the specialty chemical industry's expansion. 

COVID-19 Impact Analysis

The COVID-19 epidemic in 2020 had a detrimental effect on the market. The pandemic caused numerous countries to go into lockdown, which caused supply chains to get disrupted, work stoppages and a labor shortage. Construction, mining, automotive, cosmetics, food & beverage and other businesses were badly impacted. OICA data estimated that in the first in 2020, globally automotive output was around 17.9 million units, 31.1 million units and 52.1 units, respectively, down about 23.1%, 32.4 percent and 22.9 percent from the same period the previous year. 

Recovery in the global markets was pretty swift in the aftermath of the pandemic. The emerging markets of Asia-Pacific saw the quickest rebound in industrial activity, which aided market growth. However, the war in Ukraine has injected fresh volatility in the global market, which might hamper recovery in the long term.

Russia-Ukraine War Impact Analysis

The immediate impact of the war on was felt in the Russian market, as western specialty chemical manufacturers exited the country following the imposition of stringent economic sanctions by U.S. and EU. It led to an immediate shortage of specialty chemicals in the domestic market, as Russian chemical companies did not have the capability of producing the entire range of chemicals. Russian distributors began relying on Chinese producers to fulfill domestic demand.

Russian chemical producers are also undertaking R&D work for critical specialty chemicals used in aerospace and defense applications. The global market experienced some volatility since Russia was a key producer of many precursor materials. However, the volatility has markedly reduced over the past year. 

Key Developments

• In April 2024, Atomgrid, a new startup looking to revolutionize specialty chemical manufacturing, raised nearly US$ 1 million from venture capital firms Merak Ventures. 
• In December 2023, Kemira, a Finnish chemical manufacturer, announced that it had reached an agreement to sell oil and gas chemicals business to Sterling Specialty Chemicals. 

Market Competitive Landscape

The major global players in the market include BASF SE, Evonik Industries AG, Henkel AG & Co. KGaA, Solvay SA, Albemarle Corporation, PPG Industries, Inc., Akzo Nobel N.V., H.B. Fuller Company, Uniseal Inc. and Ashland.

Why Purchase the Report?

• To visualize the global specialty chemicals market segmentation based on type, end-user and region, as well as understand key commercial assets and players.
• Identify commercial opportunities by analyzing trends and co-development. 
• Excel data sheet with numerous data points of pouch tapes market-level with all segments.
• PDF report consists of a comprehensive analysis after exhaustive qualitative interviews and an in-depth study.
• Product mapping available as excel consisting of key products of all the major players.

The global specialty chemicals market report would provide approximately 53 tables, 65 figures and 215 Pages.

Target Audience 2024

• Footwear Manufacturers
• Medical Equipment Manufacturers
• Automotive Manufacturers
• Petrochemical Companies
• Industry Investors/Investment Bankers
• Research Professionals