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The chemical distribution market size is forecast to increase by USD 94.8 billion at a CAGR of 5.97% between 2023 and 2028. The market is experiencing significant growth due to several key drivers. One notable trend is the increasing adoption of digital technologies and digitization to enhance the distribution of commodity and specialty chemicals. This includes the use of advanced logistics systems and supply chain management tools to streamline operations and improve efficiency. Another trend is the growing emphasis on the development and distribution of sustainable and eco-friendly chemicals, as consumers and regulatory bodies demand more environmentally-friendly solutions. Strict regulations on chemical distribution activities also continue to shape the market, with a focus on ensuring safety and compliance. In specific industries, such as acne treatment, sun protection, male grooming, industrial manufacturing, adhesives, sealants, water treatment, and petrochemical facilities, the demand for chemicals is on the rise.
Furthermore, key market segments include North America, Europe, and Asia-Pacific, with each region presenting unique opportunities and challenges. Overall, the market is expected to grow steadily in the coming years, driven by these key trends and factors.
The market is a critical component of various industries, including construction, automotive and transport, electronics, agriculture, consumer goods, textiles, and electrical and electronics. This market plays a pivotal role in supplying essential chemicals, polymers and resins, and bulk chemicals to these sectors. In the construction industry, chemical consumption is significant due to the extensive use of cement, concrete, and other building materials. The industrial sectors, particularly the petroleum industry, rely heavily on chemical distribution for process treatment and fuel additives. In the electronics sector, the demand for green chemicals, such as bioacetone, is increasing due to the growing focus on sustainability and eco-friendly manufacturing processes.
Furthermore, outsourcing of chemical distribution services is a growing trend, allowing companies to focus on their core competencies while experts manage their chemical supply chain. Value-added services, such as blending, mixing, and formulating, are increasingly popular as they help reduce production costs and improve product quality. Logistics plays a crucial role in the market, ensuring timely and efficient delivery of chemicals to various industries. The use of advanced technologies, such as real-time tracking and automated inventory management systems, enhances logistics efficiency and reduces the risk of supply chain disruptions. The automotive and transport sector is another significant consumer of chemicals, particularly in the production of hybrid and electric vehicles.
In addition, the demand for fuel additives and process treatment chemicals is expected to increase as the adoption of these vehicles grows. Celtic renewables and crowdfunding are emerging trends in the market. The use of renewable resources to produce chemicals is gaining popularity due to environmental concerns and the need for sustainable manufacturing processes. Crowdfunding platforms provide an alternative financing option for startups and small businesses in the chemical industry. The market also caters to the needs of various industries, such as agriculture, consumer goods, textiles, and electrical and electronics. These industries rely on a steady supply of chemicals for their manufacturing processes, and chemical distribution companies play a vital role in ensuring their requirements are met.
In conclusion, the market is a dynamic and essential component of various industries. The trends in this market include the increasing demand for green chemicals, outsourcing of chemical distribution services, and the use of advanced logistics technologies. The market caters to the needs of various industries, including construction, automotive and transport, electronics, agriculture, consumer goods, textiles, and electrical and electronics.
The market research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in "USD billion" for the period 2024-2028, as well as historical data from 2018-2022 for the following segments.
The commodity chemicals segment is estimated to witness significant growth during the forecast period. The market for chemical distribution in the United States is driven by the extensive usage of downstream chemicals, particularly petrochemicals, in various industries. These chemicals, which include bulk chemicals and commodity chemicals, are essential inputs for manufacturing a multitude of end-products. Commodity chemicals, such as polymers, petrochemicals, and basic inorganic chemicals, are widely used in industries like construction, personal care, aerospace, and the manufacturing of plastics, synthetic fibers, synthetic rubbers, fertilizers, and pesticides. Bulk chemicals, another significant segment, are primarily used in the production of industrial chemicals, pharmaceuticals, and agriculture. The petroleum industry is a major consumer of these chemicals, with crude oil being the primary raw material.
Furthermore, warehousing, mixing, and formulating are crucial activities in the chemical distribution industry, ensuring the availability of these essential inputs for various industries. Commodity chemicals dominate the US market due to their extensive usage across various industries. Their affordability makes them a preferred choice for manufacturers seeking to minimize production costs. The market for chemical distribution in the US is expected to grow steadily during the forecast period, driven by the increasing demand for chemicals in various industries.
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The commodity chemicals segment accounted for USD 173.60 billion in 2018 and showed a gradual increase during the forecast period.
APAC is estimated to contribute 55% to the growth of the global market during the forecast period. Technavio's analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.
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The market in Asia Pacific is experiencing notable expansion during the forecast period. The escalating requirement for the distribution and delivery of specialty and commodity chemicals in burgeoning economies within this region is significantly driving the market growth. Key contributors to this expansion include China, Japan, South Korea, India, and Australia. The expanding middle-class population in these countries, accompanied by increasing disposable income, has created a substantial investment opportunity for chemical distributors. Furthermore, the market is witnessing significant advancements in process treatment solutions, fuel additives, and polymerization technologies, which are increasingly being adopted in the construction sector. Digitalization is also playing a pivotal role in enhancing the efficiency and effectiveness of chemical distribution operations. In the context of the evolving automotive industry, the rising adoption of hybrid and electric vehicles is expected to create new avenues for chemical distributors in the region.
Our researchers analyzed the data with 2023 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
Increasing adoption of digital technologies and digitization to improve the distribution of commodity and specialty chemicals is the key driver of the market. In the US chemical industry, the shift towards digitalization of the distribution supply chain has gained significant traction. The transformation is driven by changing business needs and escalating customer expectations. Digital technologies such as IoT and analytics are increasingly being adopted by both chemical manufacturers and distributors to streamline processes, enhance productivity, and ensure regulatory compliance.
Furthermore, these advanced technologies enable the analysis of voluminous data, automation of tasks, and empowerment of the workforce. The implementation of these digital solutions fosters agility, optimizes operations, and fosters innovation in business models. Furthermore, the outsourcing of value-added services such as logistics and blending has become increasingly popular in the chemical industry. Chemical consumption sectors including construction, polymers and resins, and various industrial sectors are benefiting from these technological advancements.
Growing focus on the development and distribution of sustainable and eco-friendly chemicals is the upcoming trend in the market. In response to the growing global concern for environmental sustainability and stricter regulations on chemical manufacturing, industry players are increasingly focusing on the production of eco-friendly chemicals. The use of sustainable raw materials and energy resources is becoming a priority in the chemical industry to minimize the environmental impact of emissions and waste disposal. This shift is particularly noticeable in sectors such as Acne Treatment, Sun Protection, and Male Grooming, where consumer demand for sustainable and economical solutions is high. Moreover, in the Industrial Manufacturing sector, the demand for chemicals used in Adhesives, Sealants, Water Treatment, and Petrochemical Facilities is also driving the trend towards sustainable production.
In addition, chemical manufacturers are exploring ways to maximize the use of renewable resources, allow energy recovery, and promote recycling and reuse by end-users. Environmental regulations set forth by various agencies are a significant factor in this shift. The stringent guidelines aim to reduce the environmental impact of chemical manufacturing, and manufacturers are responding by investing in research and development to create sustainable alternatives. This focus on sustainability not only benefits the environment but also enhances the reputation of chemical manufacturers and strengthens their competitive position in the market. In conclusion, the market is witnessing a significant shift towards the production of eco-friendly chemicals. The use of sustainable raw materials and energy resources is becoming a priority, and manufacturers are exploring ways to minimize waste and promote recycling and reuse. This trend is being driven by consumer demand, regulatory requirements, and the need to reduce the environmental impact of chemical manufacturing.
Stringent regulations on chemical distribution activities is a key challenge affecting the market growth. The market faces significant regulatory challenges that may hinder its expansion. REACH, CLP Regulation, and BPD regulations in the EU, as well as the US EPA's stipulations, particularly in the specialty chemicals sector, can lead to fewer manufactured specialty chemicals.
In addition, this reduction in production translates to decreased demand for their distribution. Adhering to these regulations requires distributors to prioritize waste removal, inventory management, and employee safety. Commodity and specialty chemicals, including those used in personal care products and cosmetics, must comply with these regulations to ensure their distribution. Proper technical training is essential for distributors to navigate the complex regulatory landscape and maintain a competitive edge.
The market forecasting report includes the adoption lifecycle of the market, covering from the innovator's stage to the laggard's stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth analysis strategies.
Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
The market research and growth report includes detailed analyses of the competitive landscape of the market and information about key companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The market plays a vital role in supplying a wide range of chemicals to various industries, including construction, industrial sectors, and consumer goods. In the construction industry, the demand for polymers and resins is high due to their extensive use in building and infrastructure projects. Outsourcing logistics services for chemical distribution has become increasingly popular, enabling companies to focus on their core business activities. Value-added services, such as blending, inventory management, technical training, and warehousing, are essential for chemical distributors to provide their clients with customized solutions. Commodity chemicals and specialty chemicals are the two main categories of chemicals in the market, each catering to different industry requirements.
Furthermore, employee safety is a top priority in the chemical industry, and distributors offer training programs to ensure that their clients comply with safety regulations. The petrochemical sector, which includes crude oil, natural gas, and the petroleum industry, is a significant contributor to the market. Downstream chemicals, such as adhesives, sealants, water treatment, and battery-grade lithium, are in high demand in various industries, including electronics, automotive and transport, agriculture, textiles, and electrical and electronics. Digitalization is transforming the chemical distribution industry, with the use of technologies like fungible chemicals, caldic, and crowdfunding platforms enabling more efficient and sustainable chemical production and distribution.
In addition, green chemicals, such as bioacetone and biobutanol, are gaining popularity due to their eco-friendly nature and are expected to grow significantly in the market. The petrochemical sector continues to dominate the market, but the demand for specialty chemicals is increasing due to their unique properties and applications.
Market Scope |
|
Report Coverage |
Details |
Page number |
167 |
Base year |
2023 |
Historic period |
2018-2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 5.97% |
Market growth 2024-2028 |
USD 94.8 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
5.29 |
Regional analysis |
APAC, Europe, North America, South America, and Middle East and Africa |
Performing market contribution |
APAC at 55% |
Key countries |
China, US, Germany, UK, and India |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Ashland Inc., Azelis SA, Barentz International BV, Biesterfeld AG, BRENNTAG SE, Caldic BV, HELM AG, ICC Industries Inc., IMCD NV, Jebsen and Jessen Pte Ltd., Manuchar NV, Omya International AG, Quimidroga S A, REDA Chemicals, Safic Alcan, Sojitz Corp., Stockmeier Holding GmbH, Ter Group, Univar Solutions Inc., and Wilbur Ellis Holdings Inc. |
Market dynamics |
Parent market analysis, market growth inducers and obstacles, market forecast, fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, market condition analysis for the forecast period |
Customization purview |
If our market report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Product
7 Market Segmentation by Application
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Opportunity/Restraints
11 Competitive Landscape
12 Competitive Analysis
13 Appendix
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