Growing Demand From Rubber Industry And Increased Usage of HPIB In Fuel And Lubricant Additives is Driving the Growth of India High Purity Isobutylene Market

Increasing demand for Butyl Rubber Especially in Automotive Sector will promote High Purity Isobutylene growth in India. India High Purity Isobutylene Market Size is Forecast to Reach $222.6 Million By 2026, After Growing At A CAGR Of 8.4% During 2021-2026. 

The demand for High Purity Isobutylene (HPIB) is increasing as a result of increased use in butyl rubber, which is then utilized to make rubber products. The rise of end-use sectors such as rubber manufacture and gasoline additives is responsible for the majority of the increase in HPIB demand.

The increasing usage of High Purity Isobutylene in chemical sector is driving the market in India. In North India, the High Purity Isobutylene sector is yet to optimally utilize R&D for process intensification and to achieve environment friendly processing. The specialty and knowledge intensive chemical sectors require R&D for product improvement as well as allow scope for process innovations for cost savings.  In order to promote the quantity and quality of petrochemical sector, several steps and schemes has been taken by the Government of India. These schemes comprise tax relaxation of up to 200% to petrochemical sector if it outsources projects to academic institutions. However, such steps have not proved much fruitful, as the impact of these schemes on Indian petrochemical sector has been marginal. Butyl rubber industry in Eastern India is characterized by the co-existence of a well-established rubber production sector and a fast-growing rubber products manufacturing and consuming sector. The Rubber Industry value chain begins from butyl rubber plantations and ends with a huge range of dry rubber and latex based products. Industry experts expect production to streamline by July-August 2020 and demand normalcy on replacement side would be seen by September 2020 only. Higher demand for truck tires would continue, followed by tractors, while demand for private vehicles and two wheelers would remain dull due to limited movement and ongoing work from home trend. 

The emergence of COVID-19, which is declared a pandemic by the World Health Organization, is having a noticeable impact on global economic growth. According to the International Monetary Fund, the global GDP is expected to decline by 0.3% in 2020. Whereas India’s growth estimates for 2021 declined to 1.9% from 5.8%, estimated in January by IMF. According to the Society of India Automobile Manufacturers (SIAM), passenger vehicle sales declined 51% to 143,014 units in March 2020 in India. Also, sales of commercial vehicles declined 88% to 13,027 units, those of two-wheelers fell 40% to 866,849 units. The pandemic is affecting operations of various industries including automotive, tyre, aerospace and others. After re-starting operations, it would take another six months for the market to stabilize. So the impact of COVID-19 will be felt for the entire financial year. As high purity isobutylene is extensively used in tyre manufacturing the decline in its production is affecting the growth of high purity isobutylene market in India. Thus, the COVID-19 pandemic outlook of the India High Purity Isobutylene market in 2021 is set to gradually gain momentum. 

South India holds a major share of the India High Purity Isobutylene market owing to the followed by Western India and North India that held key share of the India High Purity Isobutylene Market in 2019. High-purity isobutylene is utilized in the production of butyl rubber which is further used in manufacturing of tyres. South India is the major hub for automotive and its components. Moreover, In Jan 2018, Apollo tyres laid foundation for their fifth Indian facility in Andhra Pradesh which they will manufacture passenger vehicle tyres. Other regions like West India is also expected to grow at a significant CAGR during the forecast period. Sibur, Russia’s largest petrochemical company, formed a joint venture with Reliance Industries Ltd that has invested $ 450 million to construct the butyl rubber plant at Jamnagar, India. Whereas, PIB is a widely used dispersant in lubricant industry. For instance, in 2017, Petronas planned to invest $150 Million to set up a plant with 110 million litre capacity in Patalganga in India, to expand its presence in the lubricant market. Whereas, presence of major players in automotive lubricants like BP Castrol, Shell, Elf Auto, BPCL, HPCL, IOCL, and Lubrizol across India also contribute to the demand of PIB, which in turn drive the growth of India HPIB market.

High purity isobutylene (HPIB) exhibits excellent chemical and mechanical properties such as exceptional inertness, excellent flexibility, elasticity, and so on. Elastomers made of high purity isobutylene exhibit unique properties such as minimal permeability in gases and liquids, chemical resistance, and superior damping. These elastomers, when halogenated, improvise on their thermal performance as well. These properties give the material a distinct advantage in various applications, which include automotive dynamic parts, hoses, and inner liners of tires. Furthermore, the enhanced chemical properties obtained by using HPIB have been a major factor in its usage as an anti-knocking agent in automotive fuel. Polyisobutylene based on high purity isobutylene have low glass transition temperature and are therefore have enhanced flexibility at low temperature.

HPIB based poly(isobutylene) and butyl rubber have high impermeability to air and moisture transfer, making these materials more suitable for sealant formulation. Therefore, the demand for high purity isobutylene is increasing as the addition of it enhances the chemical and mechanical properties of various elastomers and polymers.

India’s investment in R&D has shown a consistently increasing trend over the years. It has tripled in the last decade in nominal terms from Rs.24,117 crores in 2004-05 to Rs.1,04,864 crores in 2016-17. The Government of India is supporting research and development activities by providing mega facilities for basic research, providing substantial grants to potential scientists through extramural research funding, and scaling up funding in the new areas. This support has motivated various major players to expand their business in India and further continue research and innovation in the country. With rising support from the Indian government, various industry including HPIB is continuously focusing on the development of isobutylene with more purity. Thus, the continuous increase in isobutylene purity level is influencing high purity isobutylene market growth.

The major companies in the India High Purity Isobutylene market include Vinati Organics Limited, RX Marine International, and Reliance Industries Ltd. The key focus of the companies has shifted towards partnership and product launch.