Isopropyl Alcohol (IPA) Market

Market Overview

The global isopropyl alcohol (IPA) market size was valued at USD 3.2 billion in 2022. It is expected to reach USD 5.3 billion by 2031, growing at a CAGR of 7.5% during the forecast period (2023–2031). The Isopropyl Alcohol (IPA) Market is surging due to increased demand for hand sanitizers and disinfectants in response to hygiene concerns and healthcare needs worldwide.

Isopropyl alcohol (IPA), also referred to as isopropanol, has physio-chemical and solvency characteristics comparable to ethanol, making it completely miscible in water and soluble in several ways in organic solvents. Isopropyl alcohol has many uses, including as a process solvent, an intermediate, and a cleaning agent in important end-user industries like chemical, pharmaceutical, personal care, and cosmetics. It is also the most popular and widely used disinfectant in hospitals, pharmacies, clean rooms, electronics manufacturing, and the production of medical devices. When combined with 10 to 40% purified water and alcohol concentrations between 60% and 90%, isopropyl alcohol quickly kills fungi, viruses, and bacteria.

Market Dynamics

Global Isopropyl Alcohol (IPA) Market Drivers

Growing Industry for Personal Care

Due to the increasing e-commerce sales, the personal care industry is anticipated to see an increase in young and independent brands. The most popular disinfectant used in many different industries around the world is isopropyl alcohol (IPA). IPA is one of the most effective disinfectants and a universal cleaner due to its various solutions, purity grades, concentrations, and alcohol types, which create disinfecting and cleaning products that quickly destroy pathogens and harmful microbes.

For industries that manufacture products sensitive to water, 99% isopropyl alcohol is ideal as a solvent or cleaning agent because of its quick evaporation and low water content. Soldering and rework technicians, medical device manufacturers, printed circuit board manufacturers, and computer technicians prefer immediate evaporation for fragile items such as integrated circuit adapters, computer chips, and circuit boards. Isopropyl alcohol is in high demand as a cleaning agent across various industries, likely to boost market growth during the forecast period.

Commonly used as Cleaning Agents

Hand sanitizer, also known as hand antiseptic, is a foam, gel, or liquid-based antiseptic applied to the hands to eliminate disease-causing germs. It includes both items available elsewhere and those sold only in pharmacies. Gel-based hand sanitizers are likely to account for a significant share of the market since they are more accessible and effective at destroying germs than sprays and other hand sanitizers. Although they are smaller than different types of hand sanitizer and are easier to cling to hands when applied, foam-based hand sanitizers are predicted to experience a higher growth rate.

Global Isopropyl Alcohol (IPA) Market Restraints

Shortage of IPA

Isopropyl alcohol's end-user industries worldwide ran out of the necessary amount because the supply of many chemicals from China and the United States was delayed. Now that it is reopening, the supply chain is taking some time to fill. As a result, both manufactured isopropyl alcohols and many raw materials are in short supply. Lead times doubled, and the shortage is made worse by the lack of air and ocean freight options to transport goods to and from the countries that manufacture them. Additionally, due to China and the United States' dominant positions as suppliers of both final products and raw materials, any significant disruption could jeopardize the global supply chains.

Global Isopropyl Alcohol (IPA) Market Opportunities

Bio-based Isopropyl Alcohol Innovation

Numerous studies have been conducted on processing renewable feedstocks to produce platform molecules and downstream end products in response to the demand for greener, more sustainable chemicals. In addition to a variety of specialty esters of isopropanol, n-butanol, and other bio-based alcohols, Green Biologics intends to market and sell high purity 100% bio-based isopropyl alcohol. The business is actively pursuing opportunities in specialty solvents, plasticizers, monomers, food ingredients, and cosmetics through ongoing and upcoming collaborations. Mitsui Chemicals, INC. has also reported on initiatives and research into producing isopropanol through fermentation; these developments for bio-based isopropyl alcohol are likely to shift the momentum toward sustainability in the upcoming years. Bio-based solvents must compete economically with well-established petrochemical solvents to gain a significant market share.

Regional Analysis

Asia-Pacific Dominates the Global Market

By region, the global isopropyl alcohol (IPA) market is segmented into Asia-Pacific, North America, Europe, South America, and the Middle East and Africa.

Asia-Pacific is the largest global isopropyl alcohol (IPA) market shareholder and is expected to grow during the forecast period. China has the largest economy in the Asia-Pacific region in terms of GDP. Some of the fastest-growing industries in the nation include personal care and cosmetics. The Chinese cosmetics and personal care market expanded favorably in 2019 and 2020, with segments like makeup, skincare, hair care, personal hygiene, fragrances, etc. covered. Furthermore, China is the world's second-largest market for pharmaceuticals. Due to the country's aging population, expanding middle class, rising incomes, and accelerating urbanization, the pharmaceutical market is increasing. The most extensive base to produce electronics is in China. The electronics sector saw the highest growth in products like smartphones, TVs, wires, cables, portable computing devices, gaming systems, and other personal devices. In addition to meeting domestic demand, the nation exports electronic products to other nations.

Europe is expected to grow during the forecast period. The German economy is the fifth largest in the world and the biggest in Europe. The largest pharmaceutical sector in Europe is also located in Germany. It has a significant position in the pharmaceutical market due to the active participation of numerous global pharmaceutical companies. However, the nation has signed a Strategic Committee contract for the Electronic Industries sector and launched the Nano 2022 Industrial Development and Deployment Programme, which brings together other companies that produce electronic connectors, printed circuit boards, electronic boards, and sub-assemblies. The country's isopropyl alcohol (IPA) market is expected to experience moderate demand from the electronics sector during the forecast period.

One of the largest and most R&D-intensive industries in the United States has historically been the pharmaceutical sector. With more than 40% of global pharmaceutical sales, the United States has the largest pharmaceutical industry in the world. Despite a recent decline, it is anticipated to increase over the coming years. This expansion is being driven by the aging and growing population of the United States. In addition, by 2023, the proportion of Americans over 65 is expected to rise to 15% of the population. In general, the market demand for isopropyl alcohol is likely to be driven by the pharmaceutical industry's expanding demand.

Brazil's economy has grown slowly in South America over the past few years. The nation is home to one of South America's most prosperous healthcare markets and one of the top five medical tourism destinations worldwide. People have become more interested in health and wellness trends due to rising income levels and the expansion of the middle class in the nation, which is fueling the growth of the pharmaceutical industry.

In the Middle East and Africa, Saudi Arabia has robust government control over all the main economic activities and an oil-based economy. Due to the rising demand for frozen foods, chilled processed foods and snacks, and chocolate confections, the processed food industry in the Kingdom has been expanding rapidly. In turn, these are opening up a sizable market for isopropyl alcohol. Government programs like the National Transformation Program (NTP) and Saudi Arabia Vision 2030 foresee boosting and supporting domestic manufacturing through foreign investments in the healthcare sector, particularly for pharmaceuticals.

Segmental Analysis

The global isopropyl alcohol (IPA) market is segmented by Purity Level, Application and End-User Industry.

On the Basis of Purity Level

Based on Purity Level, the global isopropyl alcohol (IPA) market is bifurcated into Technical Grade IPA, Pharmaceutical Grade IPA, Cosmetic Grade IPA, and Others.

Isopropyl alcohol with lower purity levels is included in the Technical Grade IPA segment. This segment is frequently utilized in industrial processes, including as solvents, cleansing agents, and manufacturing operations. Technical grade IPA is highly regarded for its exceptional grease and contaminant removal efficacy, rendering it a vital constituent in many industrial processes.

High purity and quality standards are crucial in the pharmaceutical industry. Rigorous purity criteria manufacture pharmaceutical grade IPA and find application in the composition of pharmaceuticals, medications, and healthcare items. Due to its exceptional purity level, this substance is devoid of impurities, rendering it appropriate for critical pharmaceutical procedures.

Various beauty and hygiene products are formulated with cosmetic grade IPA, which is utilized extensively in the cosmetics and personal care industry. This segment underscores the significance of purity and safety, guaranteeing that incorporating IPA into cosmetics, fragrances, and toiletries will not induce skin irritation or negative reactions.

Other categories cover a variety of specialized uses that can call for particular IPA changes or purity levels. These applications may include the production of electronics and beverages, among others. The Others segment accommodates specific needs and niche markets.

On the Basis of Application

Based on Application, the global isopropyl alcohol (IPA) market is bifurcated into process and preparation solvent, cleaning and drying agent, coating and dye solvent, and intermediate.

The process and preparation solvent segment is the highest contributor to the market and is expected to grow during the forecast period. Due to the difference in solubility or distribution coefficient between these two immiscible (or barely soluble) solvents, solvent extraction moves compounds from one solvent to another. Natural products like vegetable and animal oils, fats, gums, resins, waxes, colors, flavorings, alkaloids, vitamins, kelp, and alginates are extracted and purified using IPA as a process solvent. This can be applied to the production of food products as a carrier. Additionally, it is employed in the purification, precipitation, and crystallization of organic chemicals. IPA is a solvent used in the pharmaceutical industry to create intermediates used in various pharmaceutical and healthcare applications.

Isopropyl alcohol (IPA) improves performance and reduces headwear while being safe for plastic, drying quickly, leaving no residue, and extending product life. These characteristics have significantly boosted its application in the industry as a general-use cleaning agent to clean several substrates and remove a variety of soils. IPA helps remove interfering soils from optical heads and dampening residues from magnetic heads quickly and easily. It also helps improve product performance while extending the hardware and recorded media life. IPA is used more frequently in the electronics sector as a cleaning agent. Cables, connectors, electrical contacts, LCDs, keypads, glass, fiber optics, cables, keypads, and tape heads can all be cleaned and degreased with it.

On the Basis of End-User Industry

Based on The End-User Industry, the global isopropyl alcohol (IPA) market is bifurcated into cosmetic and personal care, pharmaceutical, electronics, paints and coatings, and chemicals.

The pharmaceutical segment owns the highest market share and is expected to grow during the forecast period. The pharmaceutical industry also uses isopropyl alcohol as a final product. Alcohol wipes and alcohol swabs, which are necessary for cleaning wounds, are made with isopropyl alcohol with a 70% concentration. Isopropyl alcohol can also be found in oral mouthwash solutions, ear drops, and hand sanitizers. Isopropyl alcohol can typically be used in small, safe amounts in manufacturing capsules and tablets in the pharmaceutical industry. Using solvents, IPA is used in the synthesis of pharmaceutical intermediates.

Many cosmetic and personal care items, including aftershave lotions, bath products, eye, and other makeup, as well as nail, hair, and skin care products, contain isopropyl alcohol. Antifoam is used to prevent foam from forming during production and to reduce foaming in liquid end products. Due to rising consumer disposable incomes, increased consumer awareness of natural and organic products, and increased consumer spending on upscale personal care products, the global market for cosmetics and personal care products is anticipated to experience significant growth during the forecast period.

Recent Developments

• September 2022- At the Battery Show North America, Dow will highlight the full range of Mobility Science technologies for electric vehicle (EV) battery systems and power electronics at the Battery Show North America in Novi, Michigan.
• September 2022- ExxonMobil will sell its stake in the joint venture Aera Energy. Affiliates of ExxonMobil agreed to sell Green Gate Resources E, LLC, a division of IKAV, all of ExxonMobil's interests in the California oil production operation Aera.