According to a new research report by Global Market Insights Inc. the Caustic Soda Market size will exceed $32.06 billion by 2026. Rising demand of soaps & detergents due to growing awareness about hygiene amid ongoing pandemic will boost the market growth.
Rising alumina production and shall positively effect product demand
The demand for caustic soda is witnessing growth due to increasing requirement for high specialty alumina from refractories around world. Caustic soda dissolves alumina from bauxite thus removing insoluble impurities from final product. The increasing demand for cost-effective and energy-efficient LED lighting across the world is expected to drive alumina market growth. Rise in alumina production is likely to increase caustic soda market share during forecast timeframe.
Product’s growth trajectory in terms of volume is most likely to stay linear as it is essential for raw materials in many end use industries such as alumina, paper & pulp, and organic & inorganics. During 2016 to 2019 the caustic soda market experienced steady demand growth from alumina manufacturers.
Browse key industry insights spread across 250 pages with 172 market data tables & 22 figures & charts from the report, “Caustic Soda Market by production technology (Diaphragm Cell, Membrane Cell, Mercury Cell) and Application (Pulp & Paper, Alumina, Organic Chemicals, Inorganic Chemicals, Textile, Water Treatment, Food Processing, Soaps & Detergents), Industry Analysis Report, Regional Outlook, Application Growth Potential, Price Trends, Competitive Market Share & Forecast, 2020 – 2026” in detail along with the table of contents:
Product may replace soda ash as a substitute in some downstream areas such as production of sodium triphosphate, alumina, and paper production. In terms of revenue, the market growth trajectory may vary depending on price hike and reduction. However, caustic soda market revenue is expected to grow during the forecast period at a modest growth rate.
Caustic soda is strongly a corrosive substance and any exposure to it can cause significant damage to human health. Moreover, antidumping laws along with fluctuation in production of chlorine may cause setback to overall caustic soda market growth.
Diaphragm cell shall witness modest growth rate
Diaphragm cell technology has witnessed modest growth over the years. Compared to traditional mercury cell technology, the diaphragm cell consumes much lower energy for production. The mercury cell consumed approximately 3700 kWh of electricity for each ton of product. Diaphragm cell consumed around 2900 kWh of energy for ton of product. Low energy consumption and use of inexpensive cell expected to have positive impact on overall caustic soda market demand in coming years.
Growing paper & pulp production shall enhance market opportunities
The global pulp & paper sector is highly influenced by social and environmental factors, which is expected to drive the segment growth during the forecast period. Currently, paper consumption is at an unsustainable level and is steadily rising globally, especially in Asia Pacific and at unequal levels of access in some parts of the world such as Africa.
The industry is facing some disruption from environmental forces such as climate change impact and deforestation policies. However, closed loop industrial practices, such as recycling of paper, is making the caustic soda market more sustainable.
The pulp & paper business is one of the largest industries in the world, which consumes caustic soda in large quantities. Growing population and urbanization have increased the demand for pulp & paper. The overall consumption of paper has risen and this has particularly happened in the tissue & packaging segment. Growth of the paper business is expected to increase caustic soda market over forecast timeframe.
Lower energy cost and industrialization expected to drive product in Middle East
Middle East has lowest energy rates for industrial production thus giving the added advantage to regional producers. The caustic soda market demand in the Middle East is likely to be driven with the growing Alumina production capacity and paper & pulp business in the region. The growing population, increasing tourism, and strong economy have given a boost to regional soap & detergent manufacturing firms, raising product demand.
The MEA region commands abundant natural & human resources and possesses a large share of world petroleum production and exports.
The MEA region will witness growth in export of product during the forecast period. The region is expected to foresee significant expansion in production capacity, which will increase over the forecast period. Trade war among China and the U.S. has supported the growing trend of export by regional product manufacturers. There will be significant capacity addition in the region, which will further increase the supply of product during the forecast period.
For instance, Emirates Global Aluminum has signed a long-term supply agreement with Shahen Chem Investments LLC. Shaheen Chem Investment LLC will invest in caustic soda production capacity expansion, subsequently adding 130,000 tons of caustic soda per year to the overall production.
Mergers and capacity addition are a key strategies among industry players
In January 2016, Grasim Industries Ltd. merged with Aditya Birla Chemicals (India) Ltd (ABCIL) which strengthen company’s position. Additionally, Oman Chlorine is building chlor-alkali plant which shall produce 30 TPD of chlor-alkali product such as hydrochloric acid, caustic soda and sodium hypochlorite. Some of the major players involved in the caustic soda industry are Arkema S.A., Dow, Akzo Nobel N.V., Formosa Plastics Corp., Covestro AG, FMC Corporation, Grasim (Aditya Birla), Aras Petrochemical Company, Hanwha Chemical Corporation, SABIC etc.