According to a new study by Allied market research, the specialty chemical products market is expected to grow into a $233.5 billion industry by 2020. The special chemicals industry operates in a target space full of new opportunities and challenges. In today’s world, the manufacturing of chemicals that meet the needs of customers and perform different tasks is not good enough. To gain a foothold in the chemical industry, manufacturers must stay ahead of the trend and keep up with changing industry demand, especially when the chemical industry becomes so sensitive to global forces such as Brexit and the strong US dollar.
What are special chemicals?
Also known as special or effect chemicals, special chemical products are special products that can provide a wide range of effects on which several industries rely. The use of these materials is based on their properties and functions. The physical and chemical properties of a single molecule or the composition of a mixture of chemical effects determine the performance of the final product. Specialty chemicals are used in various end-user industries around the world, including construction chemicals. The development of the global specialty chemicals industry has been promoted by the high attention paid to the research and development of special chemicals and the rise of commercialization and industrialization. In addition, the development of special chemicals for environmental protection has further supplemented the market growth. Going green is the biggest trend in this industry. About two-thirds of manufacturers of specialty chemicals are currently implementing sustainable initiatives, including biological alternatives and the use of energy-efficient separation methods, such as crystallization.
Development trend of bio-based special chemical products
Today, the demand for bio-based chemicals is increasing, and manufacturers of bio-based chemicals are competing with their fossil-based predecessors. Recently, a new biotechnology program has been proposed to convert waste gases into special chemicals. Genome and Phytonix, a non-profit organization in British Columbia, announced the establishment of a partnership to develop a manufacturing platform to convert carbon dioxide emitted from industrial facilities into specialty chemicals for the perfume industry. This project is called clean bc, which is British Columbia’s plan to reduce pollution and develop a low-carbon economy. Phytonix Corp. is an industrial biotechnology company that uses industrial-scale biotechnology to produce sustainable chemicals.
Expansion and new companies
Evonik Industries, a global leader in the production of specialized chemical products, has recently expanded its capacity to develop high-purity C13 alcohol giso tridecanol (itda). This will enable it to strengthen its position in the market and expand its customer base. Hinnerk g. Becker, market segmentation manager at Evonik performance intermediates, said: “it is a major petrochemical company and with this quality – almost 100% C13 alcohol – we can provide our customers with high-quality products.”
In addition, driven by the growing market demand at home and abroad, Indian professional companies are expected to invest in expanding production capacity in the next few years. According to the data compiled by sbicap securities, companies such as aarti industries, himandri specialty chemicals, bodal chemicals, and fine organic industries collected more than 92 billion rupees for FY20, and recommended capital expenditure of about 50 billion rupees for FY20 and 65 billion rupees for fy21. In addition, in the past few years, the demand for products of Indian professional companies has also increased by leaps and bounds.
Due to the growing market demand for specialty chemical products and increased competition from low-cost suppliers, major specialty chemicals companies have focused their investments on developing specific product lines. Prior to this, specialty chemical suppliers used to invest more in specialty products to increase demand for other product lines with similar functions. In this way, enterprises can produce and sell a variety of products at the same time, and increase sales and profits at the same time. However, times have changed and competition from low-cost suppliers has intensified. These suppliers provide special chemicals with higher efficiency, which makes large companies reconsider their marketing strategies to defeat low-cost suppliers. For most specialty chemicals, product performance, quality, and efficiency, as well as the production process, have become an important part of increasing revenue.
In addition, enterprises are now more willing to adopt new technologies and innovation models to better obtain new technological improvements. Professional chemical companies used to think that what they needed was to improve their technology internally to maintain their position in the market.