Formalin Market - Forecast(2023 - 2028)

Formalin Market Overview

The Formalin Market size is estimated to reach US$9.5 billion by 2027 after growing at a CAGR of around 4.7% from 2022 to 2027. Formalin is water-based saturated solution of formaldehyde which is simplest of the aldehydes and is also known as methanal. The solution is majorly used as industrial disinfectant to prevent formation of paraformaldehyde a highly toxic compound, and also it is used as preservatives in cosmetics and medicine sector. Hence due to such unique applicability, formalin is majorly used in sectors like agriculture, healthcare, cosmetics and pharmaceuticals. Factors like growing production of food items, increase in healthcare investments and growing consumption of cosmetics like skincare are driving the growth of  formalin market. However, formaldehyde the active ingredient in formalin is considered hazardous and exposure to it, can cause damage to lungs & gastrointestinal tract. Hence, regulation imposed by government on formaldehyde can restrict formalin production, which can hamper growth of global formalin industry.

COVID-19 Impact

In order to curb COVID-19 impact, the necessary measure like implementing lockdown all across the world had a negative impact on major end use industries of formalin like agriculture, cosmetics and healthcare. The lack of availability of labors decreased productivity of these sectors which impacted the consumption of their goods and investment made in the sectors. For instance, according to Food Industry Asia report, in 2020, the agri-food sector of Philippines contracted by 4% while Thailand’s agri-food sector shrank by 6%. Also, according to L’Oréal, in 2020, the Q1 cosmetics sale of the company declined by 8%. Further, according to US Census Bureau, in November 2020, construction spending on healthcare was US$46.7 million compared to US$48.7 million in 2019 same month, showing 4% decrease. Formalin is majorly used as preservative in cosmetics, while in healthcare and agriculture it is used as disinfectant. The decrease in productivity in these sectors, negatively impacted the demand of formalin in them, which decreased the growth of global formalin industry.

Report Coverage

The “Formalin Market Report – Forecast (2022 – 2027)”, by IndustryARC covers an in-depth analysis of the following segments of the global formalin Industry.

By Grade – Technical Grade and Commercial Grade
By Packaging – Plastic Cans, Drums, and Others
By Application – Industrial Disinfectant (Air Disinfectant, Water Disinfectant, and Surface Disinfectant), Preservatives (Cosmetics, Medicine, and Others), and Others
By End Users – Agriculture, Pharmaceutical, Cosmetics and Personal Care, healthcare, Automotive, and Others
By Geography – North America (USA, Canada, Mexico), Europe (UK, Germany, France, Italy, Netherland, Spain, Russia, Belgium, Rest of Europe), Asia-Pacific (China, India, Japan, South Korea, Australia and New Zealand, Indonesia, Taiwan, Malaysia, Rest of APAC), South America (Brazil, Argentina, Colombia, Chile, Rest of South America), Rest of the World (Middle East, Africa)

Key Takeaways

• Asia-Pacific dominates the global formalin industry as the region consists of end user of formalin like agriculture and cosmetics in major economies like China & India which leading producers of agriculture crops and have largest cosmetics market.
• Formalin as disinfectant has high applicability in healthcare facilities like hospitals and clinics where it is used to prevent formation of disease-causing bacteria, fungi and other contaminants.
• Growing desire for cosmetics and self-care products such as lotions, sunscreen and skincare has increased the scale of production of cosmetic sector, thereby positively impacting the usage of formalin as preservatives in cosmetic sector.

Formalin Market Segment Analysis – By Grade

Technical grade held a significant share in formalin market in 2021, with a share of over 62%. Technical grade of formalin is majorly used as disinfectant in healthcare & agriculture, and as preservative in cosmetics and pharmaceuticals. The rapid development in these sectors has increased their scale of productivity which has positively impacted the usage of formalin-based preservative and disinfectants in them. For instance, according to Eurostat, in 2019, healthcare expenditure in major economies like Germany & France increased to 11.7% and 11.1%. Also, according to Food and Agriculture Organization, the production of primary crops was 9.4 billion tones in 2019 which was 53% more than 2000. Further, according to statements by Shiseido, in first half of 2021, the company’s cosmetics sales was US$61.9 million showing 21.1% increase compared to US$51.1 million in 2020 first half. Such increase in sales and productivity of these sectors will create more demand for formalin-based preservatives in cosmetic sector and disinfectants in healthcare & agriculture sector. This will boost growth of global formalin industry.

Formalin Market Segment Analysis – By End Use Industry

Healthcare sector held a significant share in formalin market in 2021, with a share of over 22%. Formalin made from aldehyde like methanal is majorly used as disinfectant in healthcare facilities and hospital as it kills more germs and bacteria than normal sanitizer. The increase in expenditure in healthcare sector has positively impacted the usage of disinfectants. For instance, according to World Health Organization, in 2019, the expenditure on healthcare in East-Asia & Pacific increased to 6.6% from 6.4% in 2017. Further, according to US Census Bureau, in January 2022, total construction spending on healthcare was US$51.1 million compared to US$48.7 million in 2021 same month. Such increase in healthcare expenditure and constriction of healthcare buildings will increase demand of disinfectant to be used in them. This will provide a positive impact on the growth of global formalin industry. 

Formalin Market Segment Analysis – By Geography

Asia-Pacific held the largest share in formalin market in 2021, with a share of over 32%. The region consists of major economies like China, India and Japan which consist of major end user of formalin like agriculture and cosmetics sector. Rapid urbanization and growing economic development have led to increase in productivity of these sectors. For instance, according to comprehensive report of US Food and Agriculture Organization, in 2021, China with 554 million tons of vegetable production was the largest producer followed by India with 127 million tons. Also, China and India shared the first two ranks in fruit production with China's fruit production being 262 million tons and India's 92 million tons. Further, according to quarterly statement of Shiseido, in 2021, cosmetic sales of company increase majorly in Asia-Pacific with Japan having 31% share followed by China with 28%. Formalin is used as disinfectant to protect stock of fruit and vegetable crops from unwanted micro-organisms, while in cosmetics it is used as preservative to prevent contamination during formulation, shipment and storage. The increase in productivity in agriculture and cosmetic sector will lead to more usage formalin made from methanal, which will boost global formalin industry growth.

Formalin Market Drivers

Growing Production Level of Food Items

The rapid population increase & adoption of healthy and sustainable diet has led to increase in demand for food items, thereby increasing the global production level of food items. For instance, according to US Food and Agriculture Organization, in 2019, global fruit production went up to 883 million tones, showing 54% increase and global vegetable production was 1128 million tones showing 65% increase compared to 2000. Formalin made from aldehydes like methanal, is majorly used in agriculture sector as disinfectant so as to prevent formation of unwanted and harmful microorganism on stocks of fruits & vegetables. The increase in production level of food crops, the demand for formalin-based disinfectant will also increase, which will boost growth of global formalin industry.

Increase in Investment in Healthcare Infrastructure

Formalin which is made from methanal, as disinfectant it is used in healthcare buildings like hospitals to kill bacteria, fungi and other contaminants that could infect other patients. The increase in spending on healthcare infrastructure has positively impacted the usage of disinfectant like formalin. For instance, according to US Census Bureau, in November 2021, construction spending on healthcare was US$51.3 million showing 9% increase, compared to US$46.7 million in 2020 same month. Hence, such increase in healthcare construction will create more demand for disinfectants to be used in these buildings, resulting in more usage of formalin in them. This will boost global formalin industry growth in major economy like US.

Formalin Market Challenges

Regulation on Formaldehyde

Formalin made from aldehyde like formaldehyde must be kept in sealed container as exposure to it can cause eye irritation, headaches, and increased exposure can cause damage to respiratory tract and lungs. Hence, certain regulations are imposed by government organization on formaldehyde usage. For instance, the Toxic Substance Control Act by US Environment protection Agency has restrictions relating to usage of chemical substance or mixtures like formaldehyde. Such restrictions on formaldehyde can hamper the production of formalin as formaldehyde is active ingredient of it. This can hamper the growth of global formalin industry.

Global Formalin Industry Outlook

The companies to develop a strong regional presence and strengthen their market position, continuously engage in mergers and acquisitions. In formalin market report, the global formalin top 10 companies are:

1. DuPont
2. Huntsman International LLC
3. Celanese Corporation
4. Georgia-Pacific Chemicals
5. Sumitomo Chemicals
6. Shiny Chemicals Industrial Co.
7. Balaji Formalin Private Limited
8. Mirus Bio LLC
9. MarketLab Inc.
10. Merck KGaA

Recent Developments

• In 2022, Reckitt Benckiser collaborated with Diversey Holding Ltd. through this collaboration, leading disinfection brand of Reckitt like Dettol & Lysol along with other brands like Pine O Clean & Airwick will be distributed by Diversey in the B2B channel in the Middle East, Asia Pacific, thereby expanding their market.
• In 2020, Ecolab launched Disinfectant 1 Spray which is multi-purpose cleaner and disinfectant created for sensitive healthcare settings and can be used healthcare facilities including COVID-19 testing and vaccination sites.
• In 2020, Evonik Industries launched PERACLEAN®15 which is an environment friendly surface disinfectant which can be used to disinfect human coronavirus strain on surfaces like door knobs or hand rail.

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