|
Forecast
Period
|
2026-2030
|
|
Market
Size, By Volume (2024)
|
58.94
thousand Metric Tonnes
|
|
Market Size, By Volume (2030)
|
70.70
thousand Metric Tonnes
|
|
CAGR
(2025-2030)
|
3.25%
|
|
Fastest
Growing Segment
|
Automotive
|
|
Largest
Market
|
West India
|
Market Overview
India Phenol Market
achieved a total market volume of 58.94 thousand Metric Tonnes in 2024 and is
expected to reach 70.70 thousand Metric Tonnes by 2030 with a CAGR of 3.25% during the forecast period. The demand surge is primarily driven by the growth in phenol formaldehyde (PF) resin manufacture, which has consistently recorded double-digit growth rates in recent years. The manufacturing of agrochemicals, alkyl phenols, and its applications in the pharmaceutical industry are significant contributors to phenol demand in the domestic market. Despite the increasing demand, there have been no capacity additions for phenol in recent years, with major manufacturers such as Hindustan Organic Chemicals Limited, Arihant Solvents and Chemicals, and SI Group India Pvt Ltd currently operating in the market. However, Deepak Phenolics Limited's initiative to establish an integrated Phenol-Cumene plant is expected to reduce dependency on imports and improve foreign exchange reserves. The Asia-Pacific region is a key driver of this demand, compensating for slower growth in the American and European markets. Countries like China, India, Japan, South Korea, and Taiwan are witnessing heightened usage of phenol derivatives in electronic goods and automotive production, with China leading as the largest and fastest-growing market for phenol derivatives, a trend anticipated to continue until 2026.
Whereas global phenol consumption is expected to grow by a moderate CAGR over the forecasted periods. This is attributed to the declining usage of optical media for polycarbonate and the slowdown in the economies of BRIC nations (Brazil, Russia, India, and China). The India Phenol Market
is experiencing robust growth, driven by diverse industrial applications and
increasing demand from various sectors. Phenol, a versatile chemical compound,
finds extensive usage in the production of key derivatives such as bisphenol-A,
phenolic resins, and caprolactam, which are integral to industries like
automotive, construction, electronics, and healthcare. The automotive sector,
in particular, utilizes phenol-derived products in manufacturing lightweight
and high-performance components, contributing to fuel efficiency and
sustainability goals. In the Indian phenol market, prices experienced an upward trend from approximately 1014 USD/MT in January 2024 to around 1055 USD/MT by March 2024. This resulted in a 4% increase in the Indian phenol market, supported by corresponding growth in consumption. Stable demands from downstream industries such as construction and chemicals further bolstered this positive growth in the regional phenol market.
The phenolic resins are
widely employed in the construction industry for manufacturing adhesives,
coatings, and insulation materials due to their excellent heat and chemical
resistance properties. The healthcare sector relies on phenol for producing
disinfectants, antiseptics, and pharmaceuticals. The growing emphasis on
infrastructure development, coupled with rising investments in healthcare and
manufacturing sectors, is propelling the demand for phenol in India. Favorable
government initiatives promoting industrial growth and innovation are further
catalyzing market expansion. As a result, the India Phenol Market is poised for
continuous growth in the foreseeable future.
Key Market Drivers
Industrial Applications
Phenol holds significant
importance in various industrial applications, making it a vital component of
the India Phenol Market. In the automotive sector, phenol-derived products play
a crucial role in manufacturing lightweight and high-performance components.
These components contribute to improving fuel efficiency, reducing emissions,
and enhancing overall vehicle performance, aligning with India's focus on
sustainable transportation solutions. Foreign Direct Investment (FDI) in the
Indian automotive sector from April 2000 to March 2024 amounted to USD 36.26
billion. The automotive parts industry permits 100% FDI under the automatic
route. India is expected to become the largest electric vehicle (EV) market by
2030, presenting an investment opportunity exceeding USD 200 billion over the
next 8-10 years.
Phenol serves as a key raw material in
the production of a range of plastics and resins, including phenolic resins,
epoxy resins, and polycarbonates. These materials are extensively utilized
across various industries due to their valuable attributes such as heat
resistance, chemical stability, and mechanical strength. One of the earliest
synthetic resins, Bakelite, which is derived from phenol and formaldehyde, is
used in products such as electrical insulators, kitchenware, and automotive
components. The increasing demand for robust and heat-resistant materials in
the electronics and automotive sectors drives the need for phenolic resins.
Phenol is also essential in manufacturing epoxy resins, which are utilized in
coatings, adhesives, and composite materials. As the aerospace and automotive
industries seek advanced composites with lightweight and high-strength
characteristics, the demand for epoxy resins and consequently phenol rises.
Additionally, phenolic foam, produced from phenolic resins, is used as thermal
insulation in building and HVAC systems due to its superior insulation
properties and low flammability. Novolac resins, which are resistant to high
temperatures and chemicals, are used in applications such as circuit boards and
high-performance coatings. Resole resins, known for their rapid curing and high
mechanical strength, are commonly employed in adhesives, laminates, and
coatings.
The electronics industry relies on phenolic
materials for manufacturing printed circuit boards (PCBs), where they provide
excellent insulation and heat resistance properties. As India emerges as a hub
for electronics manufacturing, driven by initiatives such as "Make in
India" and increasing consumer demand for electronic devices, the demand
for phenol in this sector is poised to grow substantially. The diverse
industrial applications of phenol underscore its importance in driving innovation
and growth across various sectors of the Indian economy.
Increasing Demand for Derivatives
The India Phenol Market
is witnessing a surge in demand for its derivatives, driving growth and
expansion within the industry. Phenol serves as a crucial raw material in the
production of various derivatives, including bisphenol-A (BPA), phenolic
resins, and caprolactam, among others. Bisphenol-A, a primary derivative of
phenol, is extensively utilized in the production of polycarbonate plastics and
epoxy resins, which find applications in sectors such as automotive,
electronics, packaging, and construction. With India's burgeoning manufacturing
sector and increasing consumption of plastic products, the demand for BPA is on
the rise, contributing significantly to the overall demand for phenol.
The phenolic resins,
another essential derivative of phenol, are widely employed in the
manufacturing of adhesives, coatings, laminates, and molded products in
industries such as construction, automotive, and consumer goods. The robust
growth in infrastructure development, rapid urbanization, and increasing
industrial activities in India are driving the demand for phenolic resins,
further propelling the growth of the phenol market in the country.
Caprolactam, derived
from phenol, is a key raw material in the production of nylon-6, a versatile
polymer used in various applications, including textiles, automotive parts, and
industrial components. The growing demand for nylon-6 in India's textile and automotive
sectors is fueling the demand for caprolactam, thereby boosting the demand for
phenol derivatives in the market. The increasing demand for phenol derivatives
underscores the vital role played by phenol in supporting diverse industries
and driving economic growth in India.
Infrastructure Development
Infrastructure development significantly
boosts the demand for phenol in the Indian market. Phenol and its derivatives
are integral to the construction industry, contributing to nationwide
infrastructure projects. Phenolic resins, a key product derived from phenol,
are widely used in making adhesives, coatings, insulation materials, and
laminates. These materials are essential for various construction applications
due to their high strength, durability, and fire resistance, making them ideal
for use in residential, commercial, and industrial buildings, as well as
infrastructure projects like roads, bridges, and airports.
The National Infrastructure Pipeline
(NIP) of India has allocated USD 1.4 trillion for infrastructure investments,
with 24% designated for renewable energy, 18% for roads and highways, 17% for
urban infrastructure, and 12% for railways. Phenol-based products are crucial
for producing construction chemicals, such as sealants, waterproofing agents,
and concrete additives, which enhance the performance and longevity of
infrastructure.
With
India’s rapid urbanization and significant investments in infrastructure, along
with ambitious initiatives like the "Smart Cities Mission" and
"Housing for All," there is expected to be a substantial increase in
demand for phenol-based construction materials. According to Invest India, By
2030, an estimated 600 million people will reside in urban areas, creating a
need for an additional 25 million mid-range and affordable housing units. The
focus on sustainable and green building practices is further driving the
adoption of eco-friendly phenol-based products. Phenol’s versatility and
reliability make it a critical enabler of infrastructure development in India,
supporting economic growth and urban transformation. As infrastructure
investments continue, the demand for phenol and its derivatives is anticipated
to grow, driving further expansion in the phenol market.
Download Free Sample Report
Key Market Challenges
Lack of Skilled Workforce
The growth of the India
Phenol market faces a significant obstacle due to the scarcity of skilled
labor. Phenol, a crucial chemical utilized across industries like plastics,
pharmaceuticals, and cosmetics, demands specialized expertise for safe handling
and production, given its hazardous nature. India encounters difficulties in
recruiting a proficient workforce capable of efficiently managing phenol
manufacturing operations. The intricate chemical processes involved, coupled
with strict safety measures and environmental regulations, necessitate trained
personnel to avoid production setbacks, safety hazards, and escalated
operational expenses. To overcome this challenge, the India Phenol market must
invest in workforce training and development initiatives. Collaborations with
educational institutions and industry experts are crucial for nurturing a
skilled workforce. Such endeavors are vital for ensuring safe, productive, and
sustainable phenol manufacturing practices, thereby fostering market expansion
and meeting the diverse needs of industrial applications.
Increasing Competition from Foreign Players
The India Phenol market
encounters a significant hurdle in the form of rising competition from foreign
counterparts. Phenol serves as a vital chemical in various sectors like
pharmaceuticals, plastics, and chemicals. Foreign manufacturers and suppliers pose
a challenge by offering phenol products at competitive rates, often leveraging
lower production costs and abundant access to raw materials. This intensified
competition impacts market dynamics, pricing strategies, and the ability of
local players to retain a competitive edge. Indian phenol producers face the
dual challenge of balancing cost-efficiency with quality standards and
environmental concerns. To combat this, the India Phenol market should
highlight the benefits of domestic production, such as stringent quality
control and reliability. The investment in refining production processes and
effective cost management becomes imperative. Collaboration with industry
peers, research institutions, and governmental bodies can fortify the
competitiveness and sustainable growth of the Indian Phenol market amidst
escalating foreign competition.
Key Market Trends
Growing Demand for Bio-based Phenol
The India Phenol market
is witnessing a significant trend towards the increasing demand for bio-based
phenol. Traditionally sourced from petrochemicals, phenol now sees a shift
towards bio-based production methods, driven by environmental concerns and sustainability
efforts. Bio-based phenol is derived from renewable sources like lignin or
through biomass conversion processes, offering a greener alternative to
conventional petrochemical sources. This shift aligns with India's commitment
to sustainable manufacturing practices, aiming to reduce reliance on fossil
fuels and lower carbon emissions. The adoption of bio-based phenol caters to
eco-conscious industries and consumers, finding applications in resin, plastic,
and adhesive production. This trend reflects the India Phenol market's
adaptability to evolving environmental standards and consumer preferences,
contributing to the nation's sustainability objectives while meeting diverse
industry demands.
Increasing Investments in the Research and Development
Increasing investments
in the research and development of new phenol-based products are a key trend
driving the growth of the India Phenol market. Phenol, a versatile chemical
compound used in various industries, including pharmaceuticals, plastics, and chemicals,
is experiencing a surge in innovation and product development. This trend is
fueled by investments in research and development, which aim to explore novel
applications and formulations of phenol for various industrial and consumer
needs.
Researchers and
manufacturers are continuously seeking ways to harness the potential of phenol
in creating new, value-added products. These innovations include the
development of advanced resins, specialty chemicals, and pharmaceutical
ingredients that offer superior performance and properties. Phenol's
versatility as a building block for various chemical products makes it an asset
in the creation of these innovative solutions. The trend aligns with India's
commitment to technological advancements and product diversification, promoting
economic growth and market competitiveness. As the R&D efforts in
phenol-based products expand, the India Phenol market is poised for continued
growth, supporting the nation's drive for innovation and the evolution of
chemical industries toward more advanced and specialized applications.
Segmental Insights
Derivatives Insights
Based on the Derivatives, the Bisphenol A emerged as the dominant segment in the
Indian market for Phenol in 2024. This is due to its widespread
applications across industries like plastics, automotive, and electronics. BPA
is a key component in the production of polycarbonate plastics and epoxy
resins, which are extensively used in various consumer and industrial
applications. The growing demand for these materials, driven by urbanization,
infrastructure development, and technological advancements, has propelled the
dominance of the BPA segment. Its versatility, cost-effectiveness, and
favorable properties make BPA a preferred choice for manufacturers, further
consolidating its position in the market.
End-User Insights
Based on End User, the
Chemical emerged as the dominant segment in the Indian market for Phenol
in 2024. This is due to its pivotal role in ensuring safe and potable water
supplies across the country. The dominance of the chemical segment can be
attributed to the wide-ranging uses of Phenol in the chemical industry. Phenol
is a key component in the production of various chemicals, including phenolic
resins, caprolactam, and Bisphenol A, all of which have significant
applications in industries such as plastics, adhesives, and textiles. Its
reliability, consistency, and high purity make it an indispensable ingredient in
these chemical processes.
The growth of the
chemical sector in India, which includes the production of various chemicals
using Phenol as a precursor, has driven the demand for this crucial compound.
This aligns with the nation's industrial expansion and the emphasis on the
quality and performance of chemical products. The chemical industry's focus on
eco-friendly and sustainable production processes has made Phenol a pivotal
component in the development of environmentally friendly materials, further
reinforcing the dominance of the chemical segment.
Download Free
Sample Report
Regional Insights
Based on region, West India emerged as the dominant region in the Indian market for Phenol in 2024. This is due to its strategic location,
robust infrastructure, and proximity to key manufacturing hubs. The region's
well-developed port facilities and transportation networks facilitate efficient
import and distribution of phenol raw materials and finished products. West
India houses several major chemical and pharmaceutical manufacturing clusters,
providing a conducive environment for phenol production and consumption. The
presence of skilled labor, supportive government policies, and established
industrial ecosystems further bolstered West India's position as the primary
hub for phenol manufacturing and trade in the country.
Recent Development
- In
January 2024, Deepak Phenolics Limited, a wholly owned subsidiary of Deepak
Nitrite Limited, achieved ISO certification. As a prominent producer of Phenol,
Acetone, and Iso-propyl alcohol (IPA), DPL received the Integrated Management
System (IMS) certification from Bureau Veritas India. This certification
includes ISO 9001:2015 for Quality Management, ISO 14001:2015 for Environmental
Management, and ISO 45001:2018 for Occupational Health and Safety.
- In
December 2023, Vinati Organics Limited announced the start of commercial
production of Ortho Secondary Butyl Phenol (OSBP) and Di-Secondary Butyl Phenol
(DSBP) at its Lote facility. The company is the sole producer of OSBP and DSBP
in India, with production capacities of 5,000 MT and 1,000 MT, respectively.
In
November 2023, Lummus Technology, a leading global provider of process
technologies and energy solutions, announced that Haldia Petrochemicals Ltd.
(HPL) will license its olefins conversion technology (OCT) and the
Lummus/Versalis cumene and phenol technologies for a new facility in West
Bengal, India. Earlier, in October 2023, HPL disclosed plans to construct
India's first dedicated Propylene plant using OCT, as well as the largest
Phenol plant in the country, located in Haldia, West Bengal. The new phenol
plant will have a production capacity of 300,000 tonnes per year for phenol and
185,000 tonnes per year for acetone.
Key Market Players
- Hindustan Organic Chemicals Ltd
- Shiv Shakti India Pvt. Ltd.
- Aarti Industries Ltd.
- ARIHANT SOLVENTS AND CHEMICALS
- Central Drug House (P) Ltd
- NS Chemicals Pvt Ltd.
- Shubham Chemicals and Solvents Limited
- Vizag Chemical International
- Deepak Phenolics Limited
- Haldia Petrochemicals Ltd.
|
By Derivatives
|
By
End User
|
By Region
|
- Bisphenol A
- Phenolic Resin
- Caprolactam
- Alkyl Phenyls
- Others
|
- Chemical
- Construction
- Automotive
- Electronic Communication
- Metallurgy
- Other
|
- West India
- North India
- South India
- East India
|
Report
Scope:
In this report, the
India Phenol Market has been segmented into the following categories, in
addition to the industry trends which have also been detailed below:
·
India Phenol Market, By Derivatives:
o Bisphenol
A
o Phenolic
Resin
o Caprolactam
o Alkyl
Phenyls
o Others
·
India Phenol Market, By End User:
o Chemical
o Construction
o Automotive
o Electronic
Communication
o Metallurgy
o Other
·
India Phenol Market, By Region:
o West
India
o North
India
o South
India
o East
India
Competitive
Landscape
Company
Profiles: Detailed
analysis of the major companies presents in the India Phenol Market.
Available
Customizations:
India Phenol Market report
with the given market data, TechSci Research offers customizations according
to a company's specific needs. The following customization options are
available for the report:
Company
Information
- Detailed analysis and profiling of additional market players (up to
five).
India
Phenol Market is an upcoming report to be released soon. If you wish an early
delivery of this report or want to confirm the date of release, please contact
us at [email protected]