Commodity chemicals are produced in bulk amounts and are widely used in the production of other chemicals which are further used across the various end-user application. This includes tires, adhesives, apparel, construction materials, and plastics. They are trading under a broad range of categories which include organics, synthetic rubbers, plastic resins, explosives, inorganics, petrochemicals, and films. Plastics & rubber, pharmaceuticals, cosmetic & personal care, agriculture, electronics & IT, food & beverages, automotive, oil & gas, and building & construction are some of the major end-user of commodity chemicals.
The North America Commodity Chemicals market is expected to surpass US$ 76,374.2 Mn in terms of value by the end of 2028.
Growing demand for lightweight, recyclable, bio-degradable, and flame retardant plastic is expected to augment the growth of the North America Commodity Chemicals market. For instance, in June 2018, the Canadian Plastics Industry Association and the Chemistry Industry Association of Canada announced that they are planning to make 100 percent of plastic packaging recyclable or "recoverable" — divertable from landfills for use in products like chemical feedstock’s, fuel, and lubricants by 2030.
Growth in the cosmetic &personal care industry is projected to fuel the growth of the North America commodity chemicals market. According to Forbes, in 2019, the U.S. was accounted as the world’s largest beauty market, with about 20% share. It is expected to continue to advance at a 5%-to-7% compound-annual-growth-rate to reach or exceed $800 billion by 2025. Therefore, growth in the cosmetic industry in the region will positively impact market growth over the forecast period.
North America Commodity Chemicals Market: Recent Developments
Maintaining a strong supply chain network is one of the most major challenges for players engaged in the North America commodity chemicals market. This is attributed to the presence of various international players along with the large supplier base across the globe.
North America Commodity Chemicals Market - Impact of Coronavirus (Covid-19) Pandemic
The outbreaks of the Covid-19 have forced chemical manufacturers to scale down their capital and operational expenditure to 40-60% capacity owing to a labor shortage and disturbance in the supply of raw materials. Despite the downfall in demand, the chemical industry is responding positively due to the rising demand for disinfectants, personal protective equipment, and antiseptics. Moreover, protective packaging is also witnessing high demand owing to the need to prevent contamination of medical products.
Increasing sale of the electric vehicle has boosted the demand for commodity chemicals, in turn, propelling the market growth. Commodity chemicals are widely used in the manufacturing batteries. According to the Inside EVs, in 2018 the total U.S. EV sales reached 361,307 units for the year up 81 percent over 2017. The Toyota Prius Prime was the second-bestselling EV in 2018, with 27,595 units sold. Thus, the growing adoption of an electric vehicle is expected to foster the North America Commodity Chemicals market.
The growing investment by the U.S. government in the healthcare industry for improving medical facilities is one of the key trend in North America Commodity Chemicals market. According to the U.S. Centers for Medicare & Medicaid Services, the U.S. health care spending grew 4.6 percent in 2018, reaching $3.6 trillion or $11,172 per person. Thus, rising spending by the government of U.S countries will favor market growth.
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