Global bakelite market is expected to gain remarkable traction over 2021-2027, owing to myriad usage benefits like low density, high dimensional stability, surface hardness, and resistance to corrosion. Due to its insulating properties, bakelite has also been used in making electrical switches. Mounting product adoption across varied end-use industries such as automobiles, owing to its low flammability and other advantages, will further amplify the market size over the projected timeframe.
Bakelite refers to a phenol-formaldehyde resin-based thermosetting polymer that consists of monomers phenol and formaldehyde. The type of high-strength resin can withstand extensive molding and retain its shape, due to which, it has been extensively used to safeguard certain surfaces from solvents and scratches.
Surging passenger vehicle sales, especially during the coronavirus pandemic, to avoid mass transportation is one of the prominent trends characterizing the bakelite market expansion. Hailed as a revolutionary solution to small parts manufacturing, bakelite is gaining increasing traction in automotive applications. From control surfaces, instrument panels to parts under the hood, the product is used extensively, owing to its non-conductive and heat-resistant characteristics.
Despite the favorable growth environment, the industry may encounter challenges to its steady growth, due to the hazardous nature of bakelite products to the environment and other medical concerns. For example, exposure to bakelite dust can cause various complications like mesothelioma and lung infections.
With regards to the application spectrum, the bakelite market from the kitchenware segment is expected to register commendable revenue by 2027. This is attributable to the rapid increase in home cooking and baking activities and the subsequent surge in sales of kitchenware products from e-Commerce retailers worldwide. However, the closure of non-essential businesses like kitchen and cookware stores during the pandemic may limit the segmental growth to some extent in the years ahead.
From a regional perspective, the North America will depict a strong growth rate through 2027, on account of the rapid expansion of the power generation sector in countries like the U.S. This power sector growth across the region, characterized by the significant shift away from fossil fuels to clean energy, may amplify demand for bakelite in crucial infrastructural components. The dynamic acceleration in demand for chips and the favorable growth trajectory of the semiconductor sector will also assert a positive influence on the regional bakelite market revenue.
The competitive landscape of the bakelite industry comprises companies such as Sigma Laminates, Romit Resins Pvt. Ltd., Hexion Inc., and Sumitomo Bakelite Co., Ltd., among others. Strategic mergers and acquisitions, business expansions, and new product launches are among the varied initiatives being undertaken by these market players to sustain their share in the global market space.
For instance, in September 2020, Hexion entered a definitive agreement to sell its Hexamine, Phenolic Specialty Resin, and Europe-based Forest Products Resins businesses to Black Diamond and Investindustrial. These businesses, which boast recognizable trademarks and brands like Bakelite®, will continue to operate under the new company to leverage strong opportunities ahead.
The ongoing coronavirus pandemic has posed considerable challenges to various industry verticals, including the automotive sector. Robust production of COVID-19 vaccines has led to an increase in the price and use of silicon, a crucial element in manufacturing car chips, as it is also used in making vaccine vials. This extra strain on vehicle manufacturers amid the crisis may adversely impact car sales and in turn, create roadblocks to the steady growth of the bakelite industry over the forecast spell.
However, a considerable improvement in monthly power demand has been witnessed across various countries, including India during peak lockdown months. The peak power demand in March 2021 in the country stood at 170.6-GW, a hike from 157-GW in March 2020. The gradual recovery in electricity demand and ease of COVID-19 restrictions may thereby boost the adoption of bakelite solutions in the upcoming years.