Cyclohexanone Market Bolstered by the Growing Demand from the Pharmaceutical and Fertilizer Industries

The global chemical industry has witnessed a dire dearth of nylon 6, 6 during this decade, which in turn, has produced enormous opportunities for the manufacturers of the material. Cyclohexanone market companies are experiencing the shortage in the nylon industry as a blessing in disguise as the increasing production of nylon 6, 6, and other nylon polymers are generating revenue sources for them. For instance, in September 2018, Invista announced that the company is adding a nylon 6, 6 capacity in Shanghai, China, to fulfill the demand for the material in APAC. This is increasing the cyclohexanone market demand in the region as the organic chemical is used as an intermediate for the production of nylon.

Furthermore, cyclohexanone market players are reinventing their manufacturing strategies and coming with the latest developments. In early 2016, Ube Industries, Ltd. announced a project of incorporating a new manufacturing process for cyclohexanone at their Ube chemical factory in Ube City, Yamaguchi. The newly developed manufacturing process was envisioned to fulfill the demand for caprolactam as cyclohexanone is the intermediate material used for producing the chemical. The increasing innovation activities in the cyclohexanone market is quite evident with the fact that 2662 patents were registered during the last 5 years.

Cyclohexanone also plays a vital role in the synthesis of cycloamines, rubber chemicals, plasticizers, and adipic acid, a chemical that is produced from ketone-alcohol oil - a mixture of cyclohexanol and cyclohexanon. In addition to the demand from the industries that produce these chemicals, the growing influx from the paints & coatings market, which is booming due to an augmented requirement from the construction and automotive industry, is creating opportunities galore for the cyclohexanone market players. Furthermore, cyclohexanone is also used as a homogenizer for soap and detergent emulsions, which creates cyclohexanone market revenue sources for the companies.

As of 2018, the cyclohexanone market was evaluated at $9.23 billion. Owing to the influx from the various end-use industries, the forecast period 2019-2025 is poised to observe a growth in the cyclohexanone market demand at a CAGR of 3.57%.

APAC Cyclohexanone Market Growth in APAC:

APAC had the maximum cyclohexanone market share with 52% of the global revenues in 2018. The growing demand for cyclohexanone in APAC is quite evident in the fact the Gujarat State Fertilizers & Chemicals Ltd. (GSFC) commissioned India’s first film grade nylon 6 plant, and this new unit is directly making a positive impact on the cyclohexanone market demand. Furthermore, the industry leader is also taking initiatives for the improvement in the quality of caprolactam, which will also create prospects for the cyclohexanone market players. The cyclohexanone market demand in APAC can be further understood by the growing import value corresponding to the parent market.

Table 1 – The Import Value Corresponding to the Parent Market of Cyclohexanone

Import Value Data Source – International Trade Centre

The conspicuous rise in the import value of the products in the parent market substantially signifies the surging requirement for the cyclohexanone in the mentioned markets of APAC, and this increasing demand is attributable to the following factors –

· The Growth of the Paint Industry in APAC Driving the APAC Cyclohexanone Market –

In 2018, APAC had the maximum paints and coatings market share with 44% from the global revenues. Now, cyclohexanone, which is made from cyclohexane - a six-carbon cyclic molecule, is prevalently used as a solvent in paints and varnishes, and the growth prospects in the APAC paint industry are creating revenue sources for the cyclohexanone market players in the region. The prospects in the paint industry are also evident in Asian Paint’s largest capacity expansion of 500 thousand KL per annum, which was announced on June 2018. This is going to make a positive impact on the associated industries, and the APAC cyclohexanone market is going to be benefitted by the same.

Moreover, in July 2016, Nippon Paints had announced that the company would invest $284 million in China to boost paint production capacity in the next three years. Such capacity expansion projects in the APAC paints industry are supporting the cyclohexanone market.

· The Pharmaceutical Industry Upsurge in APAC Creating a Demand Influx in the Cyclohexanone Market –

According to the latest findings by the International Trade Administration, Chinese pharmaceutical market is one of the most profitable ones with a projection of $167 billion revenues by 2020 with an annual growth of 9.1% between 2015 and 2020. Furthermore, the India Brand Equity Foundation projects that in the FY 2019, Indian pharma exports will reach a value of $17.15 billion, and Government of India’s “Pharma Vision 2020” strives to make India the leader in the global pharmaceutical industry. This is leading to increased manufacturing of pharmaceutical products in the countries, which is creating prospects for the cyclohexanone market companies as cyclohexanone is used in the synthesis of pharmaceutical products.

Global Cyclohexanone Market Growth Drivers:

· Cyclohexanone Market Key Application: Nylon Industry –

The most lucrative application segment of the cyclohexanone market is found to be in the nylon industry, and the market size in this segment will increase at a CAGR of 3.46% through to 2025. As mentioned earlier, this is attributable to the growing trend of nylon plants expansion across the globe, which is creating an augmented cyclohexanone market demand. In March 2018, Evonik planned nylon 12 expansion in Germany. The company announced an investment of $494.5 million, which will boost the production of nylon 12 by 50%.

Furthermore, in April 2018, US-based Company named Ascend Performance Materials initiated Nylon 6, 6 capacity expansion with a vision of investing more money through 2021-2022. The trend of capacity expansions in the nylon industry is going to increase the cyclohexanone market value.

· The Global Pharmaceutical Industry Poised to Create Possibilities for the Cyclohexanone Market Companies –

The pharmaceutical industry is poised to expand as the International Federation of Pharmaceutical Manufacturers Association (IFPMA) projects that the global industry will reach a valuation of $1.43 trillion by 2020 wherein pharmerging countries will have 25% share in the total spending on pharmaceuticals. Discernibly, this is going to increase the manufacturing of pharmaceutical products across the globe, which will drive the cyclohexanone market.

· The Global Fertilizers Industry Generating Cyclohexanone Market Revenue Avenue –

According to the International Fertilizers Association, the global consumption of three main fertilizers of nitrogen (N), phosphate (P2O5), and potash (K2O) was estimated to be 186.67 million in 2016 with a forecast of an increase in demand by growth rates of 1.5%, 2.2%, and 2.5% respectively. The fertilizer industry players will be leveraging the demand influx, and Koch Industries Limited had already assigned a $1.3 billion capacity expansion project to Black & Veatch, a leading engineering and construction company. The upcoming years will witness an increased production of fertilizers across the world, which will increase cyclohexanone market demand because the organic chemical is used as a solvent in the synthesis of fertilizers.

Cyclohexanone Market – Competitive Landscape:

The major cyclohexanone players striving to expand geographically and leveraging the demand influx from the end-user industries are DOMO Caproleuna GmbH, Fibrant B.V., UBE Industries Limited, Versalis S.p.A, Dow DuPont, Inc., Grupa Azoty S.A., ExxonMobil Corporation, Qingdao Hisea Chem Co. Ltd, and BASF S.E.

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