Global Chemical & Material Industry
Together, the global chemical and material industries cover the production of gases, dyes, sealants, coatings, compounds, biomaterials, textiles, plastics, metals and fibers used across key industries involving engineering and science.
The global chemical industry has a market worth of around $3 trillion, with the US and the EU producing the biggest share. There are over 70,000 chemical products available on the global market, and the vast majority are composed of plastics and polymers. Chemicals are necessary for the manufacture of goods used in industries such as construction and agriculture but also for consumer goods and services. The largest consumers of chemical output include the chemical industry itself, petrol refiners, and the textile and primary metals industries.
Chemical and material production is highly regulated due to the potential harm to people and the environment involved. Handling and safety are priorities for the industry not just for its own sake but as an indicator for the substances it produces, which are subsequently used in other fields. According to the OECD, the sectors in most critical need of safety control include the manufacturing of the following products: plastics in primary forms, synthetic rubber in primary forms, dyes, pigments, basic pharmaceutical products, perfumes and petrochemicals.
Chemicals and materials overlap in certain sectors such as electronics: the worldwide market for electronic chemicals and materials was worth $28.5 billion in 2010, reports BCC Research. The market is forecast to exceed $51.5 billion in 2015, representing a yearly growth in excess of 12.5% for the five-year period ending 2015.
Regional Market Share
The US chemical industry represents around 20% of overall global chemical production. It is worth almost $670 billion and represents nearly 10% of merchandise exports from the US, which comes to $145 billion a year. There are 170 chemical companies in the US, and they have a strong international presence. In the EU, rubber, plastics and chemical industries have the strongest industry presence, employing over 3 million people across 30,000 companies.
Key Sub-Categories: Chemicals & Materials
- Chemicals: Overall chemical sales fall into a few specific segments; a little over 33% of chemical sales come from basic chemicals, just under 33% come from life sciences, between 20%-25% come from specialty chemicals, and 10% come from consumer products. The industry is made up of companies producing industrial chemicals from basic natural materials such as oil, natural gas and minerals. Industrial chemicals fall into different categories, including agro chemicals, paints, industrial gases, specialty chemicals and petrochemicals. They are used to make a wide range of end products such as inks used in printing, adhesives and cleaning compounds.
- Materials: Products from the materials industry are used in building and construction, and are central to activities such as excavation. Construction notably uses the following heavy industry materials: synthetic textiles, fibers, cement, concrete, metals and plastics. Metal materials for use in heavy industry include iron, steel, titanium, platinum, chrome and copper. The construction industry also requires finished materials such as molded steel, tiles, drywall panels, coated glass and bricks. Research from MarketLine forecasts the combined material market for metal, glass and plastic packaging will be worth almost $370 billion by the close of 2015, representing a near 4% annual growth in the five-year period from 2010. Other materials categories include textiles, wood, paper and fiber. The advanced materials market is comprised of nanotech, electronic components, semiconductors and biomaterials.
Market Outlook
The chemical industry is rebounding after the global recession, which forced the industry to cut costs and restructure to increase productivity. Chemical production output rose in 2010, having dropped in 2008 and 2009. Production is expected to continue into 2012. The US chemical market is forecast to grow 3% in 2011, with output set to rise thanks to less-expensive energy sources such as natural gas and strong demand in developing markets.
The materials industry is equally sensitive to the global financial situation, particularly given the housing crash that dragged down demand for construction materials. The development of materials will remain particularly concentrated on nanoscience and nanotechnology moving forward.
Leading Industry Associations
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