The global cellulose ether and derivatives market is expected to grow at a CAGR of 5.96% during the forecast period, i.e., 2022–2030.
Cellulose ether is a natural polymer extracted from various natural sources. It has applications in construction, cosmetic and personal care, pharmaceuticals, healthcare, food and beverage, etc. Its derivatives are most prominently used as water-retaining agents in the construction industry. They have a presence in personal care products such as lotions, creams, facewashes, shampoos, etc.
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There is an increasing demand for cellulose ether in different areas due to its preferred use in pharmaceuticals, construction, and personal care. It is most essentially used in ordinary dry mortar, dry plaster adhesives, filling compounds, and emulsion paints in the construction industry. The pharmaceutical sector makes use of cellulose ether and its derivatives as well. Cellulose derivatives are used for dispersing systems like emulsions and suspensions in this sector. The polymers help prevent mechanical or thermal shocks when used in emulsion systems.
The use of Hydroxy Ethyl Cellulose helps in improving the texture of skincare and cosmetic products. It is also highly used in the pharmaceutical and skincare industry as an excipient and stabilizer in their products. Moreover, hydroxyethylcellulose aids in changing the flow properties of water which is essential for making water-based serums, lotions, and creams. Hence, cellulose ether and its derivatives are in great demand in this sector.
The middle-income class has started to use cosmetic and personal care products daily. There are various budget-friendly products available in the market for the lower-income class. This introduction of new and advanced products is causing an increase in the consumption of these cosmetics and personal care products. This new trend of maintaining the body's aesthetic values and health between income groups has proved to be the most significant driving factor for the global cellulose ether and derivatives market.
This natural polymer in the plant cells produces cellophane, rayon, and carboxymethyl cellulose derivatives. Manufacturing these derivatives does not actively cause pollution, but certain substances can be hazardous for the environment. The cellulose ether production is divided into the viscose processes source and the cellulose ethers source category. The viscose process is the major contributor to producing dangerous air pollutants such as carbon disulfide (CS2), carbonyl sulfide (COS), and toluene.
The Hazardous air pollutants (HAPs) generated during the cellulose ethers source process are ethylene oxide, methanol, methyl chloride, and propylene oxide. The increasing concerns of the environment and climate change may bring about restrictions on the manufacturing of certain products. This can create a significant setback for the global cellulose ether and derivatives market.
APAC is the most dominating market for cellulose ether. It's expected to create more and better opportunities due to industrialization in developing countries with rising advancements. The more significant part of the population lives in APAC, which has created an increasing demand for restaurants, buildings, food products, etc. Furthermore, the construction industry is showing potential growth in South East Asia.
The countries like India, China, and Japan are showing great potential with rising technological advancements, increasing the spending limits of the people, and population growth. The APAC region is showing increasing growth than the developed nations. Hence, the global construction facilities are shifting to these developing markets. It is the availability of cheap labor, growing infrastructural facilities, more economic developments, a high growth rate, etc.
To fulfill the rising need for construction, organizations extend their production facilities. For example, Nouryon, a renowned chemical expert organization, has planned to build a 15-20 kilotons facility in Southeast Asia. This office is expected to grow Nouryon's Bermocoll business, which supplies ethyl hydroxyethyl cellulose and other derivatives to worldwide and provincial clients. In conclusion, the fast expansion in construction projects in creating economies in countries like India and China is expected to set out many open doors for the cellulose ether market.
The COVID-19 pandemic disrupted almost all the business operations, primarily in the APAC and European regions. There were a lot of travel restrictions due to which the robotics production companies faced a lot of revenue loss during the year 2020. The production units had to be closed down due to the protocols and regulations issued by the government. This caused a decline in the market during the year 2020. The consumption of cellulose ether and its derivatives had fallen during this period. As a result, the cosmetics, pharmaceuticals, food and beverage industries, etc., faced a shortage of these necessary substances.
The country which was first hit by the COVID-19 pandemic was China. As it has a good share in cellulose ether production, it caused a disturbance in the supply chain at a global level. Turn by turn, all the countries started facing the same issues, hampered production. The R&D in the health sector faced a shortage of raw materials, and due to economic tension, the research in healthcare development was temporarily paused. As the business is recovering from the pandemic, demand is gradually increasing. This has compelled the manufacturing units to increase their production capacities up to 100%.
Market Recovery Timeline from the Impact of COVID-19 and its Challenges
In the post-COVID-19 period, operations were back on track with net inflow investments across the medical care and healthcare industry. Despite the availability of funds, COVID-19 cases began rising, and many countries went into lockdown again. The international restrictions with the second and third waves aggravated the circumstances. Following the ascent in COVID-19 cases, worldwide head-out limitations were relied upon to be ready for a couple of months, further hampering the worldwide healthcare, cosmetic and personal care products. The fully automated manufacturing systems are changing the landscape of the manufacturing industry.
The demand for cellulose ether and derivatives started increasing with the successful vaccination programs. After the second and third COVID-19 waves hit the global business sectors, supply chains have effectively continued working. As the interest in cosmetic and personal care brands is developing, the demand is considerably increasing. Also, contract research associations (CROs) that had halted their R&D operations are believed to reemerge again in the cellulose ether and subordinate’s market. This will contribute to the overall growth of the market.
According to product type, the global cellulose ether and derivatives market is segmented into methylcellulose and derivatives, carboxymethyl cellulose, hydroxypropyl cellulose, and ethyl cellulose. In 2021, Methyl Cellulose and its derivatives generated the highest revenue out of all types, and it holds ~40% of the total revenue generated from cellulose ether and its products. Till 2027, it is expected to grow at a CAGR of ~5.5%. The hype in the revenue is modified applications and new trends in the various sectors such as food and beverage, cosmetic, and pharma industries.
Based on application, the global cellulose ether and derivatives market is segmented into construction, pharmaceutical, personal care, and food and beverage. The construction industry contributed the most to the revenue of the cellulose ether, and it holds more than 50% of the market from the total revenue generated in the year 2021. The increasing frequency of residential, commercial, and industrial construction projects is the primary driver of the global ether and derivatives market.
The global Cellulose Ether and Derivatives market is segmented into North America, Europe, Asia-Pacific, Central, South America and Caribbean, and the Middle East and Africa. Europe and the Asia Pacific hold a significant share of revenue in the international market. The Asia Pacific is the leading user of cellulose ether products because of the acquiring almost ~50% of the global market.
China, India, Pakistan, Bangladesh, Sri Lanka, and Thailand are a portion of the significant nations in the locale which are driving the interest for cellulose ether and subsidiaries. The youth in the region is confronting different skin issues, for example, imperfections, lopsided complexion, dryness, skin break out, scars, and dull spots. This has eventually expanded the interest in beauty care products for home use.
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Some of the key players in the global cellulose ether and derivatives market are