Market Overview:
Phenolic resins are a type of thermosetting resins that are synthesized by the reaction of phenol or substituted phenol with an aldehyde such as formaldehyde. They possess properties such as high thermal resistance, moisture resistance and fire resistance. They are widely used in wood adhesives, moulding compounds, laminates, insulation and as frictional materials. They provide strength, durability and heat resistance to materials.
The global phenolic resins market is estimated to be valued at US$ 16052.98 Mn in 2023 and is expected to exhibit a CAGR of 5.9% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market key trends:
One of the key trends fueling the growth of the phenolic resins market is the growing construction industry globally. Phenolic resins are majorly used in construction applications as adhesives for plywood, insulation, and abrasion-resistant tiles and coatings owing to their strength, heat resistance and durability. According to Euroconstruct, the global construction industry is estimated to grow annually at 3.9% during 2018-2022. This rising construction activities worldwide is driving the demand for phenolic resins. The other trends include growing automotive industry and increasing application of phenolic resins in electronic appliances. Phenolic resins are used to manufacture brake pads and rotors in vehicles due to their high heat resistance. Their use is also increasing as insulation materials in electric vehicles.
Porter's Analysis:
Threat of new entrants: The phenolic resins market is quite capital-intensive, requiring substantial investments in production facilities and R&D. This acts as a barrier for new companies.
Bargaining power of buyers: Buyers have moderate bargaining power due to the availability of substitutes like epoxy and unsaturated polyester resins. However, phenolic resins continue to be preferred for their temperature and fire resistance properties.
Bargaining power of suppliers: Major suppliers include commodity chemical companies that supply raw materials like phenol and formaldehyde. Their bargaining power is moderate due to availability of substitutes.
Threat of new substitutes: New substitutes like aramid resins provide competition but have not replaced phenolic resins completely due to their superior thermoset and fireproof properties.
Competitive rivalry: The market is moderately competitive with major global players.
SWOT Analysis:
Strengths: Superior properties of heat and fire resistance. Wide range of applications in laminates, wood adhesive, molding compounds etc.
Weaknesses: Volatility in raw material prices affects overall costs. Stringent environmental regulations regarding formaldehyde emissions.
Opportunities: Growing demand for electrical insulation and flame retardant properties in automotive and construction industries. Investments in bio-based phenolic resins.
Threats: Increased preference for greener substitutes like aramid and phosphate-based resins. Economic slowdowns affect end-use industries.
Key Takeaways:
The Global Phenolic Resins Market Size is expected to witness high growth at a CAGR of 5.9% over the forecast period, due to increasing demand from the building & construction industry.
Regional analysis: Asia Pacific dominates the global phenolic resins market, accounting for over 40% of the overall demand, led by China, India, and other Southeast Asian countries. This is attributed to growing construction activities and rapid industrialization. North America and Western Europe are also significant markets driven by increased insulation and aerospace applications.
Key players: Key players operating in the phenolic resins market include BASF SE, Chang Chun Plastics Co. Ltd., Georgia Pacific Chemicals LLC, Kolon Industries Inc., Prefere Resins, Mitsui Chemicals Inc., Sumitomo Bakelite Co., Ltd, Hitachi Chemical Co. Ltd., SI Group, Inc., and Momentive Specialty Chemicals, Inc. Major players are investing in capacity expansions and new product launches to strengthen their market position.
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