Methanol Market - Growth, Trends, and Forecast (2022 - 2027)

Methanol Market - Growth, Trends, and Forecast (2022 - 2027)

The global methanol market size was estimated at 83.8 million metric ton in 2020, and the market is projected to register a CAGR of over 5% during the forecast period (2021-2026).

The COVID-19 pandemic negatively impacted the global economy. Owing to the several unknown elements pertaining to the outbreak and as the situation is continuing to disclose, it became a challenging factor to evaluate the future. It has exposed several challenges for various industries. As most of the oil-producing countries were locked down to halt the COVID-19 spread, many uncertainties and constraints have hindered the petrochemical markets. Countries such as Saudi Arabia, China, and various other major oil producers were highly impacted. Since the petrochemical industry plays a key role in the manufacture of numerous products, the production of methol is also a part of it. However, due to the shutdown of these industries. The market for methanol was also highly impacted.

Key Highlights

• Over the short term, one of the major factors driving the market studied is the increasing demand for methanol-based fuel. In reducing carbon monoxide, nitrogen oxides, and hydrocarbon emission, methanol tends to be more preferable compared to conventional fuel gasoline. Due to this, methanol is now getting used as an alternative to conventional in major economic countries of North America and Europe.
• On the flipside, hazardous impacts on health as a result of exposure to methanol are expected to hinder the growth of the market.
• Formaldehyde dominated the market and is expected to grow at a healthy rate during the forecast period, owing to the increasing applications in the construction, automotive, and personal care industries.
• Asia-Pacific dominated the market across the world, with the largest consumption from countries such as China and India.

Key Market TrendsFormaldehyde is Dominating the Overall Methanol Market by Derivatives

• The manufacturing of formaldehyde is the largest application of methanol. Formaldehyde is the simplest aldehyde and the most commercially important one. It is commonly known as ‘methanal’ (CBO).
• Formaldehyde includes a wide range of applications in varied sectors. The combination of formaldehyde with different compounds results in varied products, such as urea, phenol, and melamine-formaldehyde resins (UF, PF, and MF resins), polyacetal resins, pentaerythritol, methylenebis(4-phenyl isocyanate) (MDI), 1,4-butanediol (BDO), and hexamethylenetetramine (HMTA).
• These are used in the manufacture of different products applicable in various industries, such as construction (adhesives, paints and coatings, carpet underlay, wood and ply adhesives, wood panels, etc.), automotive (under bonnet components, antifreeze, fuel system, components, brake pads, etc.), consumer products (paper towels, cosmetics, carpeting, furniture, cabinets, solvents, etc.), and healthcare applications (vaccine manufacturing, hard gel capsule manufacturing, pharmaceutical research, etc.).
• The Asia-Pacific region accounts for over 60% of the total global consumption of formaldehyde, with China being the leader, by consuming the major proportion of the production. Additionally, the construction industry contributes to over 50% of the total consumption globally.
• However, the presence of formaldehyde in the air, at levels higher than 0.1 parts per million (ppm), may lead to health issues to humans, such as watery eyes, burning sensations of the eyes, nose, and throat, coughing, wheezing, nausea, skin irritation, etc. Additionally, higher levels of exposure to formaldehyde concentration may lead to serious diseases like cancer.
• As a result of the aforementioned factors, methanol-based fuel has been driving the methanol market globally, and the market studied is estimated to grow during the forecast period.
• Even though formaldehyde is used in the manufacturing of pressed-wood products, fiberboard, plywood, glues and adhesives, etc., the production of these products has been highly reduced due to the shutdown of manufacturing facilities during the COVID-19 pandemic, which reduced the consumption on the industrial side.
• However, the consumption trend can be seen as vice versa in the medical industry, as formaldehyde is used in the manufacturing of disinfectants. Due to this reason, the demand for formaldehyde can be seen on the positive side, which somehow tried to balance the growth line of formaldehyde globally.

Asia-Pacific Region to Dominate the Market

• The Asia-Pacific region dominated the global market share. With the growing petrochemical industry and increasing usage of methanol-based fuel in countries such as China, India, and Japan, the usage of methanol is increasing in the region.
• China is the leading producer of paints and coatings across the world. The country accounted for more than 20 million metric ton of coatings production, which is close to 30% of the global coatings output. It currently produces more than half of the coatings in Asia-Pacific and is home to more than 10,000 paint companies, among which local producers occupy more than half of the domestic paint market share. The production is expected to contribute to the demand for numerous derivatives, such as formaldehyde, acetic acid, and MMA, and it is expected to boost the demand for methanol.
• As per the Guizhou government, by the end of 2019, Southwest China's Guizhou province had set a goal of launching 10,000 methanol vehicles, among which 7,000 vehicles were set to run in Guiyang.
• Furthermore, in India, the government is pushing the usage of methanol as fuel in vehicles and cooking fuel to promote sustainable development with less damage to the environment.
• Under the Methanol Economy program by NITI Aayog, the production capacity is expected to increase up to 20 metric ton of methanol annually by 2025, using Indian high ash coal, stranded gas, and biomass.
• Moreover, the outbreak of COVID-19 led to a halt of operations in many sectors of various countries. The automotive, manufacturing, and construction sectors are estimated to witness declines in terms of growth and outputs, owing to the lockdown called by the governments for a brief period. Owing to this, the demand for methanol has been reduced drastically, which, as a result, tends to constrain the growth of the market.

Competitive Landscape

The global methanol market is partially fragmented in nature, with the top eight players accounting for about 40% of the global production capacity. Some of these major players include Methanex Corporation, SABIC, Zagros Petrochemical Co., Yankuang Group, and Proman AG, among others.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

Companies Mentioned

IBM Corporation
Oracle Corporation
Internap Corporation
Packet Inc. (An Equinix Inc. Company)
Scaleway Inc.
Amazon Web Services Inc
Rackspace Inc.
CenturyLink, Inc.
LightEdge Solutions, Inc

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