Growing Demand for Fuel Efficient Vehicles and Technological Upgradation in Automotive Production is Driving the Growth of the Isocyanates Market

The Isocyanates Market is observed to grow at a CAGR of 5.8% during the forecast period 2022-2027 and would reach an estimated revenue of US$39.6 billion by 2027. Isocyanates, having high anti-corrosive nature, thermal resistance and mechanical strength, are considered a major ingredient in polyurethane polymer production. Such polymer is further used in various applications such as paints & coatings, elastomers and adhesives & sealants. Due to their high thermal and electrical insulation, isocyanates are majorly used as foams, paints and coatings on automotive bodies. Rapid urbanization and improvement in living standards have increased the demand for fuel-efficient vehicles, increasing automotive production. According to the International Organization of Motor Vehicle Manufacturers, America's automotive production in 2021 saw a 3% increase as compared to the production in 2020. Owing to such rapidly growing automotive production, the demand and usage of isocyanates for polymer foams, paints & coatings are also expected to increase. This is one of the major factors driving the market growth for Isocyanates.

Based on the end-use industry, the Isocyanates market can be segmented into automotive, building & construction, solar energy industry, oil & gas industry, electrical & electronics, wood industry, footwear industry and others. The leading segment in the isocyanates market is evaluated to be automotive and during the forecast period 2022-2027, with an estimated CAGR of 6.3%. This can be attributed to various factors such as rapid growth in automotive production owing to upgradation in manufacturing technology, increase in disposable income and growing investment inflows in the sector.

Based on geography, the Isocyanates market can be segmented into North America, South America, Europe, APAC and the Rest of the World. According to the analysis, in 2021, the Asia-Pacific region emerged as the most profitable region in the market and held a 41.3% share of the total revenue earned by the market, globally. The region is considered a hub for automotive manufacturing with major countries such as China, India, Japan and Korea witnessing various investments and site establishment in the sector. These activities have increased the scale of automotive production. According to the International Organization of Motor Vehicle Manufacturer’s data, China’s automotive production saw a 3% increase whereas Japan witnessed a 2% during 2021. An increase in automotive production would drive the demand for isocyanates in automotive paints & coatings and foams applications. This is the primary factor stimulating the market growth of Isocyanates in the Asia-Pacific region.

Key companies holding a major share in the Isocyanate market are BASF SE, DowDu Pont, LANXESS, Evonik Industries, Huntsman International LLC, Mitsui Chemical Inc, Wanhua Chemical Group, China National Blue Star Co. Ltd, Asahi Kasei Corporation and Chemtura Corporation.