Market Trends of Butylated Hydroxytoluene Industry
Increasing Demand from the Plastics and Rubber Industry
- Butylated hydroxytoluene is widely used in the plastics and rubber industry owing to its antioxidant characteristics, and its usage is expected to grow rapidly during the forecast period.
- Earlier, rubber was coated with antioxidants to protect it from oxidation, and once the outer coating wears off, the unprotected rubber will instantly undergo oxidation. Chemicals are incorporated into the rubber during mixing instead of coating the rubber surface to prevent this.
- Antioxidants react with oxygen trapped in the rubber compound during mechanical mixing and later bleed to the surface, thereby providing complete protection for rubber from oxidation.
- Similarly, in plastics, oxidation leads to discoloration and general disorientation. It can either be caused by oxidation or free radical generation. Free radicals are generated due to heat, mechanical stress, and radiation. Antioxidants react with free radicals and prevent the degradation of plastics.
- Moreover, according to the World Economic Forum, by the year 2050, global plastic production is expected to reach three times. Therefore, the growing demand for plastics is expected to drive the market demand for butylated hydroxytoluene.
- The demand for rubber is increasing in recent years. For instance, on October 2022, Bridgestone Corporation announced that it approved plans to invest USD 26.7 million to strengthen its investments in its rubber plantations in South East Asia. The investments aim to ensure a sustainable natural rubber supply for producing tires.
- Furthermore, the growing demand for plastics and rubber from various industries, such as automotive and packaging, is expected to drive the butylated hydroxytoluene market. For instance, according to OICA, in 2022, almost 85 million motor vehicles were produced worldwide, which shows an increase of 6% compared with 2021. As a result, an increase in automobile production is expected to increase demand for rubber tires, creating an upside for the butylated hydroxytoluene market.
- Moreover, in October 2022, RMKH Glove launched the first glove manufacturing facility in the Kingdom of Cambodia at the Manhatten Special Economic Zone in Bavet. The manufacturing facility contains an annual capacity of over 600 million pieces and helps the local farmers to market their natural rubber and increases the rubber market in the region.
- All the factors above will likely be the driving forces behind the butylated hydroxytoluene market during the forecast period.
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Asia-Pacific to Dominate the Market
- The Asia-Pacific region is expected to dominate the market for butylated hydroxytoluene during the forecast period, owing to the increase in consumption from countries like India and China.
- Some of the largest butylated hydroxytoluene producers are in the Asia-Pacific region. Some of them include Honshu Chemical Industry Co. Ltd, Milestone Preservatives Pvt. Ltd, Ratnagiri Chemicals Pvt. Ltd, Dycon Chemicals, VDH Chem Tech Pvt. Ltd, and FINAR, among others.
- Butylated hydroxytoluene is an antioxidant food additive that protects unsaturated organic compounds in foods and oils from atmospheric oxidation.
- Association of Natural Rubber Producing Countries (ANRPC), Malaysia's rubber exports dropped to RM 35.99 billion ( USD 8.169 billion) in 2022 compared with RM 71.01 billion ( USD 16.11 billion) in 2021. Therefore, a decrease in rubber exports is expected to affect the studied market's growth.
- Moreover, the growth in automobile production in China will likely promote the demand for rubber tires, creating an upside demand for the butylated hydroxytoluene market. For instance, in 2022, around 2,70,20,615 units of automobiles were produced in the country, which shows an increase of 3% compared with 2021.
- According to the National Bureau of Statistics of China, in January 2022, the retail trade revenue of cosmetics in China amounted to about USD 9.18 billion. It reached about USD 9.76 billion in January 2023. As the demand for cosmetic products expands further in second-and third-tier cities of China, the butylated hydroxytoluene market is expected to maintain its growth momentum shortly. In addition, the changing attitude among men toward skin care fosters the booming men's cosmetics market in China.
- Most of the rubber products, such as tires, are a blend of natural and synthetic rubber. India is the sixth-largest producer of natural rubber globally, with a production capacity of approximately 775,000 metric tons in 2022. Furthermore, India was the second largest consumer of natural rubber worldwide in 2021, behind China. India's natural rubber consumption decreased by almost 10% in 2020 but rebounded by 21% in 2021 to 1.3 million metric tons.
- Moreover, according to India Brand Equity Foundation (IBEF), the Indian e-commerce industry is on an upward growth trajectory, and it is expected to surpass the United States to become the second-largest e-commerce market in the world by 2034. Therefore, the growth of the e-commerce industry is expected to create an upside demand for the butylated hydroxytoluene market in the country.
- Furthermore, over the next five years, the Indian e-retail industry is projected to exceed ~300-350 million shoppers, propelling the online Gross Merchandise Value (GMV) to USD 100-120 billion by 2025. The increase in internet penetration and the change in government policies allowing 100% foreign direct investments in the e-commerce sector are expected to boost the consumption of plastics.
- Therefore, the factors above, coupled with government support, are expected to contribute to the increasing demand for the butylated hydroxytoluene market in the Asia-Pacific region during the forecast period.
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