Adipic Acid Market - Growth, Trends, COVID-19 Impact, and Forecasts (2023-2028)

Key Highlights

• The growing electronics market and increased use of personal care products are fueling the market growth.
• Stringent environmental regulations regarding production are expected to hinder the market's growth.
• The Asia-Pacific region is expected to dominate the market during the forecast period owing to its growing development in major countries such as India, China, and Japan.

Adipic Acid Market Trends

Increasing Demand from the Automotive Industry

• Adipic acid is mainly used as a monomer in producing polyamide 6.6 pellets and other polyamides or polymers in engineering plastics and as polyurethane for flexible and semi-rigid foams.
• Nylon 66, manufactured from adipic acid, is used primarily for its superior mechanical, temperature-resistant, and lightweight properties in the automotive industry. Also, polyamide is used in producing glass-reinforced plastics-based structural parts, air intake manifolds, engine covers, rocker valve covers, airbag containers, and various other interior and exterior automotive parts.
• The increased demand for lightweight engineering plastic is expected to drive the adipic acid market's growth. Due to current environmental and economic concerns, automobile manufacturers are incorporating more advanced plastic materials to reduce weight and make vehicles more fuel-efficient.
• The high absorption properties of plastics also allow the vehicle to meet stricter safety standards. In contrast, using polyamides such as nylon 6 and nylon 6,6 provides for the depreciation of the mass of parts used in vehicles as they offer more design freedom than metals.
• The increasing number of light and electric vehicles directly impacts engineering plastic consumption, which, in turn, is anticipated to drive the demand for adipic acid over the long term during the forecast period. According to the China Association of Automobile Manufacturing, the production of New Energy Vehicles in the country witnessed a year-on-year increase of 96.9% in December 2022.
• The factors mentioned above are expected to contribute to the growth of the adipic acid market in the automotive segment during the forecast period.

Asia-Pacific to Dominate the Market

• The Asia-Pacific region is expected to dominate the adipic acid market. The rising automotive, textiles, and electronics industries in major countries such as India, China, etc., contribute to the market's huge demand.
• China includes the world's most extensive electronics production base. Electronic products, such as wires, cables, computing devices, and other personal devices, recorded the highest growth in the electronics segment. The country serves the domestic demand for electronics and exports electronic output to other countries, thus, providing a massive market for adipic acid.
• Furthermore, the Indian electronics industry is one of the fastest-growing industries globally. The domestic electronics manufacturing sector is expanding steadily, owing to favorable government policies, such as 100% foreign direct investment (FDI), no requirement for industrial licenses, and the technological transformation from manual to automatic production processes.
• Electronics System Design and Manufacturing (ESDM) is the fastest-growing industry, continuously transforming businesses and economies worldwide. For instance, by 2025, India's digital economy will be worth USD 1 trillion.
• China is also one of the most attractive countries for clothing manufacturing due to relatively low labor costs and fewer commercial obstacles. According to the National Bureau of Statistics of China, the country manufactured 3.18 billion meters of textile for garments as of October 2022. The materials produced each month were consistently greater than three billion m. Hence positively impacting the market growth.
• Additionally, according to the China Association of Automobile Manufacturing, the production of passenger cars in the country witnessed a year-on-year increase of 11.2% in December 2022.
• Furthermore, in November 2022, INVISTA Nylon Chemicals Co. of China inaugurated its new adiponitrile plant with an investment of USD 1 billion at the Shanghai Chemical Industry Park. The new adiponitrile plant includes a capacity of 400,000 tons/year.
• Hence, with growth in the country's electrical, electronics, automotive, and textile sectors, the demand for adipic acid is expected to increase in the upcoming years.

Adipic Acid Market Competitor Analysis

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