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Fatty Alcohols Market Overview
Fatty Alcohols Market - Emergence
of COVID-19
The outbreak of COVID-19 has hampered the growth of the fatty alcohol market due to factory closures, supply chain disruptions, movement restrictions, and social distancing requirements. Disruption of supply chain and decrease in purchasing capital has directly impacted the automotive, construction, and textile industries. According to the Society of India Automobile Manufacturers (SIAM), passenger vehicle sales declined by 51% to 143,014 units in March 2020 whereas the sales of commercial vehicles crashed by 88%. Decrease in automotive sales lowers the demand for fatty alcohols for fuel additives, brake fluids, grease, and lubricating oil. Also, 40% of construction firms have had to lay off staff due to the Covid-19 outbreak, according to data from the Associated General Contractors of America. Thus, the decline in the growth of the automotive and construction sector negatively affects the Fatty Alcohols Market.
Report Coverage
The report: “Fatty Alcohols Market – Forecast (2021-2026)”, by IndustryARC, covers an in-depth analysis of the following segments of the Fatty Alcohols Market.
By Source: Animal Fats,
Tropical Oils (Palm Kernel Oil, Coconut Oil, and Palm Oil), Soft Oil (Sunflower
Oil, Soya Oil, and Others), and Others
By Manufacturing Process:
Sodium Reduction, Hydrogenation, and Others
By Application: Lubricants
and Fuel Additives, Disinfectant, Plasticizers, Paint and Coatings, Cosmetics
(Shampoos, Lotions & Creams and Others), Pharmaceuticals, Food &
Beverages, Textile and Leather Processing, Soap and Detergents, and Others.
By Geography: North
America (U.S., Canada, and Mexico), Europe (U.K, Germany, France, Italy,
Netherland, Spain, Russia, Belgium, and Rest of Europe), Asia-Pacific (China,
Japan, India, South Korea, Australia, and New Zealand, Indonesia, Taiwan,
Malaysia and the Rest of APAC), South America (Brazil, Argentina, Colombia, Chile,
and Rest of South America), Rest of the World (Middle East, and Africa)
Key Takeaways
- Stringent government regulations and ill effects of petrochemical-based fatty alcohols on the environment raises are projected to fuel the demand for natural fatty alcohols during the forecast period.
- Rise in demand of oleyl alcohol, catalytic hydrogenation, octadecenoic, fatty acids, and Echolocation from pharmaceutical industries also contribute to market growth.
- Lockdown and disruption of supply chain due to coronavirus pandemic slowed the growth of Fatty Alcohols Market.
Fatty Alcohols Market Segment Analysis – By Source
Tropical oils segment
held the largest share of more than 35% in the Fatty Alcohols Market in 2019. Tropical
oils such as coconut oil, palm oil, or palm kernel oil contain a great deal of
saturated fatty acids and are widely used for the formulation of fatty
alcohols. The demand for tropical oil-based Fatty Alcohols Market is driven by an increase in demand for naturally derived ingredients like echolocation, and natural
emulsifiers to manufacture detergents & soaps, and personal care products. An increase in environmental and health concerns globally with respect to the use
of petrochemical-based fatty alcohols boosts the demand for tropical oil-based
fatty alcohols.
Fatty Alcohols Market Segment Analysis – By Chain Length
Based on the
chain length, C11-C14 segment held the largest share of more than 25% in the Fatty Alcohols Market. C11-C14 fatty alcohols are also used as co-emulsifiers,
emollients, and thickeners in cosmetics and food industries. C11-C14 fatty
alcohols are used for sodium Laureth ether sulfate (SLES), an inexpensive and
very effective foaming agent that finds application in a wide range of cosmetics
including shampoo, body washes, etc. The rise in disposable income of the middle
class and growing aspirations of people to live a good life and look good proliferates
the growth of the cosmetic industries, which in turn boosts the fatty alcohol
market.
Fatty Alcohols Market Segment Analysis – By Manufacturing
Process
Hydrogenation segment held the largest share of more than 30% in the Fatty Alcohols Market in 2019. Oils and fats can be converted directly to alcohol by hydrogenolysis. In hydrogenolysis process the triglycerides are hydrogenated at high temperature and pressure in the presence of specific catalysts such as nickel, palladium or platinum that further results in a mixture of fatty alcohols and glycerine. Mixture is then separated from glycerine to obtain pure fatty alcohol.
Cost
effectiveness and ease of extraction as compared to sodium reduction are the
major factors driving the use of the hydrogenation process. On the downside, the
catalyst and hydrogen consumptions are higher in this process because
by-product glycerin will be simultaneously hydrogenated to produce propylene
glycols and propanol.
Fatty Alcohols Market Segment Analysis – By Application
Soap & detergents segment held the largest share of more than 25% in the Fatty Alcohols Market in 2019. Fatty alcohol behaves as a non-ionic surfactant, due to its amphipathic nature. Lauryl alcohols, a type of fatty alcohol are widely used to manufacture detergents and soaps due to their solubility and wetting properties. The increasing demand for detergents and soaps from industrial and household sectors for the removal of dirt and grease is augmenting the growth of the market. According to the International Trade Centre, United States import value of soaps or organic surface-active products used as soap increased from $ 985.17 million in 2018 to $ 1,022.27 million in 2019. Rising health concerns among people also fuel the demand for soaps and detergents which in turn drives the growth of the fatty alcohol market.
Fatty Alcohols Market Segment Analysis – By Geography
Asia-Pacific has dominated the Fatty Alcohols Market with a share of more than 45% in 2019 followed by North America and Europe. The growing infrastructural development, rising per capita income of the individuals, increasing birthrate, higher domestic demand along the availability of low-cost labor is expected to drive the demand for fatty alcohols in the region. Fatty alcohol functions as an emulsion stabilizer, opacifier, emollient, and surfactant in the formulation of pharmaceuticals such as Amoxicillin and Clavulanate Potassium, Budesonide, Metadate ER etc. for the treatment of bacterial infection, bronchiectasis, inflammatory bowel disease, and Attention-deficit hyperactivity disorder (ADHD).
In May 2020, Indian pharmaceutical sales grew 9 percent y-o-y to US$ 1.47 billion, according to India Brand Equity Foundation. In 2019, the government of Malaysia allocated a sum of US$ 7 billion to the public health sector, an increase of 7.8 percent from 2018. Also, the Australian Government announced a $5 billion, 10-year investment plan for the Medical Research Future Fund (MRFF) as a part of its 2019–20 budgets to support Australian health and medical research. The increasing healthcare investments in various regions of APAC will lead to increased demand for pharmaceuticals, which will further increase the demand for fatty alcohols in the market.
Figure: Asia-Pacific Fatty Alcohols Market Revenue, 2020-2026 (US$ Billion)
Fatty Alcohols Market Drivers
Growing demand from textile processing industries
Fatty Alcohols are used in the formulation of fatty alcohol ethoxylates which are used for scouring and emulsifying in the textile industry. They are also used in dye leveling and as wetting agents. The thriving textile industry across the globe and vast technological advances may boost the global demand for fatty alcohol. According to Indian Brand Equity Foundation (IBEF), India’s textile and apparel exports accounted for US$ 38.70 billion in 2019 and is expected to increase to US$ 82.00 billion by 2021.
Also, In March 2016, a consortium of over 50 companies
and universities were awarded the grant to form a new manufacturing hub focused
on revolutionary fibers and textiles technologies that will bring over $300
million in public-private investment to develop futuristic fabrics and textiles
helping to accelerate the revival of textile manufacturing in the United States
which in turn expected to increase the demand for fatty alcohols.
Increasing usage of fatty alcohols in plasticizers formulation
Fatty alcohols
with glycerol fatty esters are used as plasticizers in plastic and its
co-polymer compositions to improve the processability and physical-mechanical
properties. Surging use of plasticizer for increasing the overall elasticity of
material to make it bendable accelerates the demand for fatty alcohols. Plastics
are light weighted, hence increasing demand for plastic as an alternative for
heavy metals and glass from the automotive and construction industries fuel the
growth of the fatty alcohol market. According to the PlasticsEurope, global
plastics production almost reached 360 million tonnes in 2018 whereas plastics
production almost reached 62 million tonnes in Europe. Thus increasing plastic
demand raises the demand for plasticizers which in turn aids the fatty alcohol
market growth.
Fatty Alcohols Market Challenges
Volatile prices of raw materials and stringent regulations on plastic
Volatility in prices of raw
materials such as palm oil, petrochemicals, etc. is a major challenge for the
growth of Fatty Alcohols Market. According to the International Monetary Fund,
price of palm oil increased from $ 498.48 per metric tons in May 2020 to $
610.49 per metric ton in July 2020. Also, BP Statistical Review of World
Energy, estimated that in the recent year there is been an increase in the
price volatility of crude oil, such as the crude oil price decreased from
$98.95 in 2014 to $52.39 in 2015 and increased from $43.73 in 2016 to $71.31 in
2018, restraining the growth of the fatty alcohol market. Furthermore,
government restrictions on the use of plastics also hamper market growth. For
instance California has introduced a regulation known as SB270 in July 2015 for
prohibiting the use of plastic bags at groceries, pharmacies, and other stores. In
Africa, in May 2019, United Nations Environmental Programme (UNEP), Tanzania
banned the importation, production, sale, and use of plastic bags.
Fatty Alcohol Market Landscape
Technology launches,
acquisitions and R&D activities are key strategies adopted by players in
the Fatty Alcohols Market report. Major players in the Fatty Alcohols Market are
Wilmar International Ltd., Kao Corporation, Kuala Lumpur Kepong
Berhad, Musim Mas Holdings, Godrej Industries Limited, Procter &
Gamble, VVF L.L.C., Sasol, Emery Oleo Chemicals, Eastman Chemical Company,
Royal Dutch Shell Plc. SABO S.p.A, among others.