Coherent Market Insights

Formic Acid Market to surpass US$ 3.43 Bn by 2031

Formic Acid Market to surpass US$ 3.43 Bn by 2031 - Coherent Market Insights

Publish In: May 02, 2024

Formic acid market is estimated to be valued at USD 2.34 Billion in 2024, growing at a CAGR of 5.6% over the forecast period (2024-2031). Formic acid is majorly used as a silage preservative and acidulant in the animal feed industry, thus boosting the market growth.

Rising Demand from Animal Feed Industry

Formic acid serves as an effective preservative for silage and is widely used for food preservation in livestock farming. It helps inhibit the growth of mold and prevents the spoilage of fodder. With the rapid expansion of the global meat industry, the demand for high-quality animal feed is surging which is directly influencing the consumption of formic acid.

Growing Use in Leather Tanning

Formic acid is a vital chemical used in the pickling or dehairing process during leather tanning. It helps remove hair follicles and prevents putrefaction of animal hides. The booming automotive and footwear industries have resulted in increased consumption of leather products worldwide, thereby augmenting the demand for formic acid in leather processing.

Increasing Demand from Animal Feed Preservatives is Driving Growth in the Global Formic Acid Market

Formic acid is widely used as a preservative in silage and feed to prevent the growth of undesirable molds and bacteria. It helps extend the shelf life of animal feed by preventing spoilage. With growing meat consumption globally and the rising demand for animal protein, the production of animal feed has increased substantially. This has directly increased the consumption of formic acid as a preservative in feed formulations. Several feed producers are opting for formic acid due to its low cost and effectiveness compared to other alternatives like propionic acid.

Rising Usage in Rubber Processing is Augmenting Revenues

Formic acid acts as a catalyst during the vulcanization of synthetic and natural rubber. It accelerates the cross-linking reaction between rubber and sulfur, reducing the required vulcanization time. This allows manufacturers to improve the production efficiency. Formic acid is also mixed with latex to maintain its fluidity during shipping and storage. With the automotive industry growing steadily and tire demand surging worldwide, consumption of formic acid from the rubber industry has witnessed a parallel rise. Continuous product innovation and increasing rubber usage across various end-use industries are further propelling the demand.

Volatility in Raw Material Prices Pose Challenge

Formic acid is commercially manufactured by the carbonylation of methanol or by the oxidation of methyl formate. Both these processes involve methanol as the primary feedstock. However, methanol prices have exhibited significant fluctuations over the past decade due to uncertain supply and demand dynamics. Any increase in methanol costs directly impacts formic acid prices. Supply chain disruptions and inconsistent availability of raw materials also affect stable formic acid production. This price volatility poses a threat to the profits and planning ability of manufacturers.

Stringent Environmental Regulations Hamper the Market Growth

Strict environmental regulations regarding formic acid emissions during production and transportation present another restraint. As formic acid is highly corrosive and hazardous in nature, it is subject to numerous safety and handling guidelines by regulatory agencies worldwide. Non-compliance can lead to penalties and litigation issues. Manufacturing plants require expensive scrubber systems and advanced wastewater treatment facilities to meet discharge standards. Additional compliance costs inflate overall expenses. Transportation of formic acid also involves complex safety protocols. The onerous regulatory framework increases paperwork and monitoring responsibilities of companies, adversely impacting their profit margins.

Rising Demand from the Textile Industry Offers Opportunities

One key opportunity for participants is the rising application of formic acid in textile finishing. It acts as an effective antimicrobial agent in downstream processes to prevent microbial degradation of fabrics. With formic acid, textile manufacturers can protect fabrics from disease-causing organisms and odor formation for a longer duration. This ensures higher product quality and durability. Expanding textile production globally due to surging apparel demand presents lucrative growth prospects. Significant investments in textile manufacturing units across developing Asian countries will further stimulate formic acid consumption.

Growing Usage in Animal Pharmaceuticals Provides Potential

Another promising area which can drive future revenues is the usage of formic acid as an excipient in veterinary medicines and supplements. It is often used as an acidifying agent and preservative to extend the shelf life of animal healthcare products. With rising pet adoption worldwide and growing preventive healthcare spending on livestock, the veterinary pharmaceuticals market has been widening rapidly. This increases the requirement of auxiliary chemicals like formic acid. Furthermore, increased awareness about animal welfare is augmenting the medication and supplementation of livestock. Both these factors point towards high opportunities from the animal pharmaceutical applications of formic acid in the coming years.


Key Developments

  • In 2023, Nitto Denko Corporation and Air Water Inc. jointly initiated a project aimed at producing formic acid, a substance used for grass preservation, from CO2 obtained from biomass derived from livestock manure. This innovative approach utilizes Nitto's CO2 chemical conversion technology to convert the greenhouse gas emissions into a valuable product, contributing to both environmental sustainability and the efficient utilization of resources.
  • In 2020, BASF, a global chemical company, implemented price increases for formic acid and propionic acid. These adjustments were made in response to various factors such as changes in raw material costs, market dynamics, and overall industry conditions. The price adjustments aimed to ensure the continued supply of high-quality products and the sustainability of BASF's operations in the face of evolving market conditions.

Key Players

BASF SE, Eastman Chemical Company, Shandong Acid Technology Co. Ltd, Gujarat Narmada Valley Fertilizers & Chemicals Limited, LUXI GROUP, Perstorp Holdings ABPOLIOLI SpA, PT Pupuk Kujang, Wuhan Ruisunny Chemical Co. Ltd, Prakash Chemicals Agencies Pvt. Ltd., GJ Chemical, EMCO Dyestuff, Kakadiya Chemicals, Meru Chem Pvt. Ltd, SGS & Company, CDH Fine Chemical, and Rashtriya Chemicals and Fertilizers Limited

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