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The market for chlorine is expected to register a CAGR of more than 4.5%, during the forecast period. Major factors driving the market studied are the rising demand from the pharmaceutical and agrochemical industries. However, stringent government regulations in Europe is expected to hinder the growth of the market studied.
- EDC/PVC segment dominated the market, and is expected to grow during the forecast period, owing to the increasing usage in various end-user industries.
- Increasing demand from the wastewater industry is likely to act as an opportunity in the future.
- Asia-Pacific dominated the market across the world, with the largest consumption coming from countries, such as China and India.
Key Market Trends
Increasing Demand for EDC/PVC
- Ethylene and chlorine are the major raw materials for VCM (vinyl chloride monomer). Therefore, VCM is affected by the supply and demand conditions of both ethylene and chlorine. It is expected that the maximum demand for chlorine shall arise from the PVC segment.
- A large amount of chlorine is required as a raw material in the manufacturing process of EDC and PVC. There are two types of PVC, namely, rigid resins and flexible resins.
- Rigid resins provide most of the growth opportunities, with major end uses being fittings, pipe and fittings, windows, fencing, roof tiles, and automobile parts. Flexible PVC finds outlets in film and sheets, flooring, wire and cable coating, synthetic leather products, and shower curtains.
- EDC is being used as a solvent in the metal cleaning, textile, and adhesives industries.
- In Europe, PVC has been one of the slowest growing commodity polymers, with usage becoming more concentrated in certain segments, such as pipes and fittings, and window profiles. In other areas, such as packaging, bottles, and short-lived consumer groups, the PVC share has been shrinking, with its replacement by polyethylene terephthalate (PET) and polyolefins.
- However, the demand for PVC and EDC has been growing from regions, such as Asia-Pacific, South America, and the Middle East & Africa. Asia-Pacific is anticipated to be the largest market for PVC, during the forecast period, as the region has been experiencing massive constructional activities and increasing popularity of consumer goods. Additionally, the increasing population, coupled with changing lifestyle, has raised the demand for residential construction and automotive sales in this region.
- The rising demand for polyvinyl chloride is expected to boost the demand for chlorine. This, in turn, shall benefit the market for chlorine during the forecast period.
Asia-Pacific Region to Dominate the Market
- The Asia-Pacific region dominated the global market share. With growing urbanization and increasing need for fresh water in countries, such as China and India, the usage of chlorine is increasing in the region.
- With 2.4% land resource and 4% water resource, India supports nearly 18% of the world’s population. Lately, the dwindling quality of agricultural products has raised serious questions on the sustainability of the agricultural practice. To counter the problem, efforts have been made to improve the productivity of the land and increasing the efficiency of the supply chain (while reducing the carbon footprint), by implementing PVC pipes in field irrigation systems.
- The packaging industry in India is one of the fastest growing industries, with direct or indirect influence on all industries. The spending on packaged foods is increasing due to urbanization, increase in per capita income, and the growing number of workforces.
- There is great growth potential, since India’s per capita consumption of packaging is only 4.3 kg, whereas, in neighboring Asian countries, such as China and Taiwan, it is about 6 kg and 19 kg, respectively. This clearly indicates that the market is underpenetrated and offers a great business opportunity for the Indian plastics industry.
- All such factors are expected to drive the market in the region, during the forecast period.
The chlorine market is partially fragmented and dominated by very few players. Some of these major players include Nouryon, BASF SE, Ercros SA, OLIN Corporation, and Tata Chemicals Ltd.
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