Paraformaldehyde Market - Forecast(2023 - 2028)

Paraformaldehyde Market Overview

The paraformaldehyde market size is forecast to reach US$2.6 billion by 2027 after growing at a CAGR of 5.6% during 2022-2027. Paraformaldehyde is a polymer form that is slowly formed by formaldehyde polymerization with a typical degree of polymerization of 8-100 units. This polymer comes with properties such as low acid content, good solubility, easy storage, stability, and high productivity. These robust properties enable the use of paraformaldehyde in a wide range of applications such as agrochemicals, resin production, adhesives, disinfectant, organic chemical synthesis, and cleaning products. The agriculture sector is one of the largest markets for paraformaldehyde where it is extensively used in the production of several agrochemicals such as fungicide, pesticide, and herbicides. The agriculture sector is expanding globally with increasing production and investments and this is expected to drive the market’s growth during the forecast period. For instance, according to the stats by Invest India, exports in India’s agriculture sector registered a surge of 17.37% during 2020-21 compared to exports during 2019-20. Furthermore, the use of paraformaldehyde is gaining traction in the automobile sector. This polymer is used in the synthesis of high-grade paints for use in automobiles. The automotive sector is showing tremendous growth and this is anticipated to drive the growth of the market during the forecast period. According to the October 2021 stats by the European Automobile Manufacturers Association, the battery electric vehicle segment made up 9.8% market share in the third quarter of 2021 compared to 4.9% in the same quarter the previous year. The strict regulations regarding the use of paraformaldehyde might affect the market’s growth during the forecast period.

COVID-19 Impact 

The paraformaldehyde market was badly impacted due to the COVID-19 pandemic. Disturbances in the market such as disruption in the supply chain and idling of factories affected the market’s growth amid the pandemic. The market players had to implement several measures to withstand the severity of the pandemic and maintain a standard business operation. Furthermore, the stagnant growth in the automotive sector slowed down the growth of the market. According to the report by The International Organization of Motor Vehicle Manufacturers (OICA), vehicle production went down 16% globally due to the COVID-19 pandemic. However, the market witnessed significant growth towards the end of 2020. Going forward, the market is expected to have robust growth due to the massive expansion of the agriculture and automotive sector. 

Report Coverage 

The report: “Paraformaldehyde Market Report - Forecast (2022-2027)”, by IndustryARC, covers an in-depth analysis of the following segments of the Paraformaldehyde Industry.

Key Takeaways: 

•  The agriculture sector is dominating the market. According to the stats by the United States Department of Agriculture, agricultural imports in the US recorded at US$ 143.42 billion dollars in 2020 compared to US$ 141.44 billion dollars in 2019. 
• The automotive sector is expected to influence the market’s growth during the forecast period. As per the report by the European Automobile Manufacturers Association, in June 2021, the registrations in the passenger cars segment grew up by 10.4% compared to the registrations in June 2020.
• The Asia-Pacific region is anticipated to witness the highest demand for paraformaldehyde owing to the expanding agriculture sector in the region. For instance, according to the stats by InvestIndia, Agri commodities exports exhibited a growth of 23.24% during March-June 2020 witnessing an export of US$ 341.91 against the export of US$ 277.45 during the same period in 2019. 

Figure: Asia Pacific Paraformaldehyde Market Revenue, 2021-2027 (US$ Billion)

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Paraformaldehyde Market Segment Analysis - By Application 

Agrochemicals application dominated the paraformaldehyde market in 2021 and is growing at a CAGR of 5.9% during the forecast period. Paraformaldehyde is used in an array of applications ranging from resin production to disinfectant, and organic chemical synthesis. However, the polymer is used massively in agrochemical applications. Paraformaldehyde is used in the synthesis processes of several agrochemicals such as fungicides, pesticides, and herbicides. Paraformaldehyde’s use in agrochemicals ensures high yield rates and efficient production in the agriculture sector. Accordingly, market players and research organizations are engaging in the higher usage of paraformaldehyde. As per the May 2020 journal by the University of Minho Documentation Services (SDUM), glyphosate herbicide along with the presence of paraformaldehyde was used for the photosynthesis of solanum lycopersicum leaves. The test result suggests a rise in photosynthetic activity in the leaves. Such growing use of paraformaldehyde in agrochemicals applications is expected to increase the demand for paraformaldehyde during the forecast period. 

Paraformaldehyde Market Segment Analysis - By End Use 

The agriculture sector dominated the market in 2021 and is growing at a CAGR of 6.4% during the forecast period. The demand for paraformaldehyde in the agriculture sector has been on the rise in the last few years owing to its robust property of enhancing the plant and crop protection capabilities of agrochemicals such as fungicide, pesticides, and herbicides. Paraformaldehyde use in agrochemicals also ensures high yield rates. The agriculture sector is displaying tremendous growth globally with increasing investment and production and this is expected to propel the market’s growth during the forecast period. For instance, according to the 2021 stats by trade.gov, USA’s agricultural exports to Vietnam jumped by 40% in value in the last five years. Similarly, according to the stats by the European Commission, the values of the agricultural sector in Poland (+1.9%) and Spain (+1.1%) increased in 2020. Such growth in the agriculture sector globally is expected to increase the high use of paraformaldehyde, thereby driving the growth of the market during the forecast period. 

Paraformaldehyde Market Segment Analysis - By Geography 

The Asia-Pacific held the largest share in the paraformaldehyde market in 2021, up to 34%. The high demand for paraformaldehyde is attributed to the expanding agriculture sector in the region. Paraformaldehyde which is obtained by formaldehyde polymerization is used in the synthesis of agrochemical products such as herbicides and pesticides. The agriculture sector is exhibiting outstanding growth in the region with increasing production and processing of food products and this is anticipated to stimulate the demand for paraformaldehyde during the forecast period. For instance, according to the March 2021 data by eastasiaforum.org, the Japanese government announced the plan to expand agricultural exports from USD 8.5 billion in 2020 to USD 18.5 billion by 2025. Similarly, according to the stats by India Brand Equity Foundation, India’s total food grain production stood at 296.65 million tonnes in FY20, up by 11.44 million tonnes compared with 285.21 million tonnes in FY19. Such a huge growth in the region’s agriculture sector is expected to bolster the demand for paraformaldehyde during the forecast period.

Paraformaldehyde Market Drivers 

Booming automotive sector will drive the market’s growth 

The automotive sector is one of the important markets for paraformaldehyde where this polymer is used for the synthesis of paints and topcoats for high grade automotive finishes. The automobile sector globally is booming with increasing vehicle production and sales and this is expected to catapult the market’s growth during the forecast period. For instance, according to the data by India Brand Equity Foundation data, in 2020, India became the world’s fifth-largest automobile sector with 3.49 million units of automobiles sold combinedly in the commercial and passenger vehicles segment. Similarly, as per the stats by European Automobile Manufacturers Association, in 2020, hybrid electric vehicles accounted for 11.9% of total cars sold which was 5.7% in 2019. Such massive growth in the automotive sector globally is expected to increase the use of paraformaldehyde, in turn driving the growth of the market during the forecast period. 

Expanding agriculture sector will drive the market’s growth 

Paraformaldehyde finds its highest use in the agriculture sector where it is utilized in the synthesis processes of multiple agriculture chemicals that include fungicide, pesticide, and herbicides. The agriculture sector is rising globally with increasing production and this is expected to augment the market’s growth during the forecast period. For instance, as per the stats by India Brand Equity Foundation, India’s horticulture crop production touched a record 331.05 million metric tonnes in 2020-21, a jump of 10.5 million metric tonnes over the FY20. Similarly, according to the stats by Agriculture and Agri Food Canada, the revenue of farmers from the sale of agricultural commodities stood at a record US$ 68.7 billion. Such massive growth in the agriculture sector is expected to amplify the use of paraformaldehyde, which in turn will influence the market’s growth during the forecast period. 

Paraformaldehyde Market Challenges 

The strict regulations regarding the use of paraformaldehyde might hamper the market’s growth 

Paraformaldehyde is associated with several adverse effects on human health owing to which the material is strictly monitored and this might affect the market’s growth during the forecast period. As per the September 2021 report by InterAtlas Chemical Inc., prolonged exposure to paraformaldehyde leads to skin irritation and throat inflammation. The European Chemicals Agency regulates the use of paraformaldehyde owing to its adverse effect on human health. Such regulations regarding the use of paraformaldehyde might hamper the market’s growth during the forecast period. 

Paraformaldehyde Industry Outlook 

Investment in R&D activities, acquisitions, product and technology launches are key strategies adopted by players in the Paraformaldehyde Market. Global Paraformaldehyde top 10 companies include: 

1. Caldic B.V.
2. Celanese
3. Alpha Chemika
4. Merck
5. Ercros
6. Ekta International
7. Metafrax Chemicals
8. GFS Chemicals
9. Parchem
10. Alfa Aesar 

Recent Developments 

• In May 2021, Metafrax announced the construction of its new plant in Gubakha for the production of paraformaldehyde. This plant will produce 30 thousand tons of paraformaldehyde per year, making Metafrax the only manufacturer of paraformaldehyde in Russia.
• In January 2020, Caldic B.V announced the acquisition of Malaysia-based specialty chemicals distributor, DCM Asia. Through this acquisition, Caldic strengthened its specialty chemicals portfolio including paraformaldehyde in Southeast Asia. 

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