Editor’s Comment: Catalysts lead specialty chemical business

According to the latest market research reports, global specialty chemicals market is currently at over $700bn and is likely to cross the $1,000bn mark by 2023.

Martin Menachery is the editor of refining & Petrochemicals Middle East.
Martin Menachery is the editor of refining & Petrochemicals Middle East.

During the forecast period of 2018-2023, the worldwide specialty chemicals sector is expected to register a CAGR of 5.08%. As far as the GCC is concerned, according to the figures by GPCA, less than one percent of the region’s production capacity is estimated as specialty chemicals. Sadara chemical complex – as a transformational project – will help fill the gap of specialty chemical products supply, and thereby support the value-added downstream industry growth, and enhance its efficiency across the region.

Dominated historically by the North American, Western European and Japanese firms, the global specialty chemicals business is in a path of transition, with innovative products and transformational projects, including Sadara. North America, Western Europe and Japan still dominate the specialty chemicals business, but not to the same extent as earlier. The focus of the global specialty chemicals industry is currently shifting towards Asia-Pacific.

As explained in the Knowledge Partner column (pages 32-33) in this Special Report, Asia-Pacific is estimated to lead the market owing to its rapid economic and industrial growth, especially in the paints and coatings industry segment. The demand for these chemicals will come from various industrial verticals as specialty chemicals are known to improve product performance. The rise of manufacturing sector in the developing countries is also expected to boost the global specialty chemicals market.

In the Knowledge Partner column, detailing on the future role of the global specialty chemicals sector in the global chemical industry landscape, Madiha Naz, director, technical support and product development, DIA’33, says that 3D printing technology is a fast-emerging dynamic future trend. This transformational industry, ranging from prototype building to custom production, builds parts layer by layer via photo-reactive resin curing with UV laser, or other similar power sources. According to her, photo-curable resins in the following technologies are used like acrylates, cationic epoxies, thiols and reactive diluents. Demand for sustainable energy is witnessing an increase worldwide. The solar energy market is huge, and the recent growth has been many times more than before and it will continue to grow further.

In the Market Focus column (pages 30-31) in this Special Report, Valentin Kotlomin, director, strategic studies and downstream economics at Euro Petroleum Consultants, says that catalysts are amongst the most significant segments of specialty chemicals – the material that the end-user does not get to see, but that is indispensable to the process of producing fuels and chemical products, specialty chemicals included. According to him, one of the things that makes catalysts stand out as specialty chemicals is the high profitability of this segment – along with flavours and fragrances, high-performance thermoplastics and food additives, catalysts are amongst the leaders in the segment.

According to Kotlomin, the Middle East is also one of the biggest in the world by volume of refining and chemical production, and there are no signs of a downturn. Feedstock availability and strategic location midway between Europe and Asia are the two key drivers for the development of refining and chemical industry in the Middle East. The construction and expansion of refining capacities in the region, along with increasing process complexity, refining-to-chemical integration and growing output of chemical production create a firm basis for robust growth in demand for catalysts.

Reflecting strong optimism, Kotlomin predicts increasing catalyst production capacities in the Middle East both through expansion of the existing plants and construction of new facilities. According to him, the most likely scenario is that the new catalyst production facilities in the region would be either 100% subsidiaries of the existent global catalyst companies, or their joint ventures with the region’s energy companies.

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