UREA FORMALDEHYDE MARKET ANALYSIS

The global urea formaldehyde market size was valued at US$ 14,716.7 million in 2022 and is anticipated to witness a compound annual growth rate (CAGR) of 3.27% from 2023 to 2030. The global urea formaldehyde market is witnessing strong growth on the account of growing use of commercial resins and the discovery of new applications. Moreover, the increasing demand for well-structured polymers is also contributing to growth of the market. In addition, the market is further expected to witness significant growth in the coming years due to rapid urbanization and industrialization.

Global Urea Formaldehyde Market: Regional Insights

Regionally, Asia Pacific is estimated to account for the largest share of the global urea formaldehyde resins market. As the region undergoes rapid economic growth, it is predicted to generate lucrative business opportunities for urea formaldehyde market players. In addition, the rapidly developing furniture industry in the region is also fueling demand for this product. Furthermore, the high GDP growth rate in the region is also contributing to growth of the urea formaldehyde market. Besides, the government is investing heavily in the construction sector in the region, thereby bolstering the demand for urea formaldehyde. Additionally, the increasing demand for urea formaldehyde resins in the automotive industry is enhancing the market in this region.

Moreover, North America urea formaldehyde market is expected to gain major share in the U.S. and Canada during the forecast period. The US is projected to have the highest consumption of urea formaldehyde in the next few years due to increasing construction activities. Meanwhile, the demand in the European Union and Germany is expected to grow at a modest pace.

Figure 1. Global Urea Formaldehyde Market Share (%), By Region, 2022

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Global Urea Formaldehyde Market Drivers:

Increasing demand for medium density fiberboard to foster market growth

Urea formaldehyde adhesives are majorly used in the bonding/gluing agent in medium density fiber board applications and growing demand for MDF from various wood working applications is driving the market growth. Recently, wood furniture industry has witnessed significant growth due to growing construction sector. MDFs are widely used as flooring tiles due to their economical nature when compared to other flooring options.

Growing demand for practice board from furniture sector to propel market growth

For instance, furniture manufacturing accounts for about 3.97% of the total manufacturing sector in India, and major part (85%) of the furniture industry in India is unorganized. Remaining (15%) is organized and comprises large manufacturers. Moreover, robust demand from upholstery and bedroom cabinets us further expected to augment the market growth.

Global Urea Formaldehyde Market Opportunities:

The growing use of commercial resins and the discovery of new applications are projected to bring bright market opportunities. Moreover, the demand for well-structured polymers is also contributing to the growth of the market. In addition, the market is expected to witness significant growth in the coming years.

Due to increased government expenditures and the expansion of the commercial market, the demand for urea formaldehyde is likely to increase. Another factor that drives growth of the market is the increasing number of wooden constructions. This is expected to hold potential market opportunities.

Global Urea Formaldehyde Market Trends:

Rapid urbanization and increasing population

The growing population is driving growth of the furniture and construction industries in developing countries. This is uplifting market growth. As a result, the demand for urea formaldehyde in particle boards is increasing. Hence, propelling market growth.

Increasing demand for consumer electronic and automobile is a trend

There is a high demand for good quality resins in automobile and electronic will favor the market growth. For instance, urea formaldehyde is used in various electrical applications, such as knobs, desk lamps, fuse boxes, switches, etc. Growing construction activities, along with house renovation activities across the world, is projected to augment the demand for urea formaldehyde resins in the electrical sector.

Global Urea Formaldehyde Market Restraints:

Negative impact of the Covid-19 is restricting market growth

The growth of the furniture industry is likely to be limited due to the outbreak of COVID-19, which has caused unfavorable conditions for the market growth.

Strict government regulation due to health hazards associated urea is hindering market growth

According to the National Toxicology Program, formaldehyde is a proven human carcinogen as of 2011. Government restrictions on formaldehyde emissions might slow the market's expansion for urea formaldehyde. Emission regulations for formaldehyde from composite wood products are established by the Formaldehyde Standards for Composite Wood Products Act of 2010. 

Figure 2. Global Urea Formaldehyde Market Share (%), By Application, 2022

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Global Urea Formaldehyde Market Segmentation:

The global urea formaldehyde market report is segmented into application, End User industry, and geography

Based on application, the market is segmented into Particle Board, Wood Adhesives, Plywood, Medium Density Fiberboard, and Other Applications. Out of which, Particle Board is expected to dominate the global market over the forecast period and this is attributed to the increasing demand for urea formaldehyde as bonding agent in particle board. Moreover, urea formaldehyde gives cost-effective benefits over other substitute.

Wood Adhesives segment is also expected to witness significant growth in the near future and this is owing to the growing use of urea formaldehyde as adhesive in exterior and semi-exterior wood panels application. It is also used in preparation and bonding of both low- and high-pressure paper overlays and laminates.

Based on End User industry, the market is segmented into Automobiles, Electrical Appliances, Agriculture, Building and Construction, and Other End User Industries. Out of which, Automobiles is expected to dominate the global market over the forecast period. Urea formaldehyde is widely used as an amino plastic resins which is used to produce automobiles tires in order to improve the bonding of rubber to tire cord. Moreover, urea formaldehyde also find application as automotive primers.

Electrical Appliances segment is also expected to witness significant growth in the near future and this is owing to the growing demand for urea formaldehyde in molding electronic devices, electrical appliances casing, and flat glass.

Global Urea Formaldehyde Market: Key Developments

In July 2022, Hexion Inc. launched bio-based methanol in the production of formaldehyde as part of its sustainable product development process at its Baytown, Texas, manufacturing site.

In July 2018, BASF increased the prices for all its Kauramin and Kaurit impregnating resins in Europe by EUR 30 per metric ton, effective from August 2018.

Global Urea Formaldehyde Market: Key Companies Insights

The global urea formaldehyde market is highly competitive. This is attributed to continuous launch of new technologies due to ongoing R &D and efforts by value chain participants. Moreover, key players are adopting various business growth strategies in order to expand their presence on regional as well as global basis. Some of the key players in the global urea formaldehyde market are Hexion, BASF SE, Georgia-Pacific Chemicals, Hexza Corporation Berhad, Metadyena, Jiangsu sanmu group Co. Ltd, Ashland, ARCL Organics Ltd., Kronoplus Limited, Advachem, Qafco, Sabic, Acron Group, Asta Chemicals, Melamin Kemična Tovarna D.D. Kočevje, and Arclin Inc.

*Definition: Urea-formaldehyde (UF) is a polymer that can be produced by oxidation of methanol. The reaction between methanol and urea leads to the formation of a resin, called UF-resin, which is suitable for the production of a variety of interior products.