The global Oxo alcohol market size was valued at USD 13.4 billion in 2022 and is projected to reach a value of USD 22.6 billion by 2031, registering a CAGR of 6.8% during the forecast period (2023-2031).
Rapid industrialization and the expansion of manufacturing units are among the primary factors driving global demand for oxo-alcohols along with the increasing demand for plasticizers, paints, and coatings in various sectors. The oxo process, which comprises the hydroformylation of olefins (alkenes) followed by hydrogenation, produces a series of compounds known as oxyalcohols. These alcohols have various industrial applications and are frequently employed as chemical intermediates in manufacturing plasticizers, coatings, adhesives, solvents, and other products. They are important in various industries, including plastics, chemicals, automotive, construction, and textiles.
Oxo alcohol market share is predicted to expand at a CAGR of 6.8% because of the increasing demand for plasticizers, paints, and coatings in various sectors. Rapid industrialization and the expansion of manufacturing units are among the primary factors driving global demand for oxo-alcohols. Furthermore, the growing worldwide population is increasing construction activity, raising the demand for plasticizers made with oxo-alcohols.
Architectural coatings, such as paints, varnishes, and protective coatings, are critical for protecting and enhancing the aesthetic of structures such as buildings, bridges, and infrastructure. Oxo alcohols are used in the formulation of these coatings, and they help to improve their durability, adherence, and performance. Economic expansion drives the oxo alcohol market trend, including residential, commercial, industrial, and infrastructure development. Buildings, roads, bridges, and public facilities are all part of construction and infrastructure activity. Oxo alcohols are utilized in coatings that protect infrastructure components like bridges against weathering, corrosion, and wear. Creating new infrastructure and refurbishing old structures due to urbanization drives the demand for coatings. Oxo alcohols are essential in the formulation of coatings that give aesthetic appeal, protection, and long-term durability.
The price of raw materials, notably olefins obtained from crude oil, is closely related to the cost of generating oxo alcohols. When crude oil prices fluctuate, the cost structure of the oxo alcohol production process is directly influenced, affecting both manufacturers and consumers. According to the US Energy Information Administration (EIA), the price of Brent crude oil fluctuated from approximately USD 20 per barrel in April 2020 to more than USD 80 per barrel in October 2018, demonstrating significant volatility. Raw material price fluctuations can undermine supply chain stability, hurting upstream suppliers and downstream customers. Feedstock cost volatility might hamper inventory management and long-term planning. Global economic conditions, geopolitical events, supply-demand imbalances, and other factors impact crude oil prices. Economic downturns or geopolitical tensions can cause sharp fluctuations in crude oil prices, causing instability in the oxo alcohol market.
The Asia-Pacific region is experiencing fast urbanization and infrastructure development, driving demand for building materials, coatings, and adhesives. Oxo alcohols are essential in formulating these goods, and rising markets in the area represent a considerable opportunity for the global oxo alcohol market. According to the United Nations, the Asia-Pacific region has the highest rate of urbanization globally, with more than half of its inhabitants living in cities. Demand for housing, transit networks, commercial spaces, and public amenities is driven by urbanization, creating a demand for construction materials and coatings.
The Asia-Pacific construction business is expanding rapidly, fueled by infrastructure projects such as roads, bridges, airports, and smart cities. In cities around Asia-Pacific, real estate development, including residential, commercial, and hospitality projects, is expanding. These initiatives fuel demand for building materials, paints, and adhesives used in construction and interior finishing. According to Global Construction Perspectives and Oxford Economics' Global Construction 2030 research, the Asia-Pacific region is expected to generate more than 60% of global construction activity by 2030.
| Study Period | 2019-2031 | CAGR | 6.8% |
| Historical Period | 2019-2021 | Forecast Period | 2023-2031 |
| Base Year | 2022 | Base Year Market Size | USD 13.4 Billion |
| Forecast Year | 2031 | Forecast Year Market Size | USD 22.6 Billion |
| Largest Market | Asia Pacific | Fastest Growing Market | Europe |
Asia-Pacific oxo alcohol industry size is anticipated to exhibit a CAGR of 7.2% during the forecast period. The area's expanding automotive and construction sectors have been important drivers of the Asia-Pacific oxo alcohol industry. Oxo alcohol's use in paints, varnishes, coatings, and adhesives has increased demand in these industries. In addition, the region has less stringent regulations than North America and Europe, pushing market expansion. Oxo alcohols are in significant demand in China due to large-scale manufacturing. China has a high demand for coatings, paints, adhesives, and varnishes, as well as increased regional construction spending. It also has a burgeoning vehicle industry, which consumes many lubricants. These characteristics, combined with low-cost production and loose government regulations, will likely drive the expansion of the oxo alcohol market throughout the forecast period.
Furthermore, with rising demand from the solvents and plasticizers industries, developing countries such as Japan and India will become important markets for oxo alcohols in the next years, offering tremendous opportunities. According to the National Investment Promotion and Facilitation Agency (NIPFA) of India, the overall export value of organic and inorganic chemicals in India was USD 2,332.92 million in September 2022, accounting for 7.15% of all exports. Increased demand for OXO alcohol in the production of plasticizers, co-monomers, and co-polymers is driving demand for OXO alcohol and driving market revenue growth in this area. For example, in May 2021, Bharat Petroleum Corporation Limited (BPLC), an Indian petrochemical corporation, opened a dedicated OXO alcohol processing unit in Kochi, Kerala, to produce 2-Ethylhexanol and other derivatives. These factors are causing Oxo alcoholmarket growth in this area. As a result, the region is predicted to grow rapidly throughout the study period.
Europe is anticipated to exhibit a CAGR of 7.0% over the forecast period. The oxo alcohol market insight shows that the European oxo alcohol market is home to numerous significant chemical manufacturers and petrochemical sector players. These businesses manufacture, distribute, and supply oxo alcohol to downstream sectors. The rising usage of OXO alcohol in producing sustainable chemical derivatives and goods and tight laws governing the use of solvents are likely to fuel global revenue growth.
Furthermore, the geopolitical situation between Russia and Ukraine has considerably impacted the supply of petroleum. According to the World Economic Forum (WEF), Russia will begin shutting down the key gas pipeline to Germany in September 2022. BASF SE, a multinational chemical manufacturing firm based in Germany, unveiled highly efficient and sustainable product advancements in its chemical catalyst range in September 2021. This portfolio involves using catalysts to improve the efficiency of manufacturing isopropyl alcohol (IPA), a key component in hand sanitizers. This is especially crucial during the COVID-19 outbreak because hand sanitizer is in great demand. BASF's catalyst Ni 3354 E combination is well-known for its strong performance in manufacturing OXO alcohols. With this launch, the company will assist its customers in gaining a larger market share by providing sustainable and efficient solutions. These circumstances have considerably impacted OXO alcohol production, driving revenue growth in this region.
The North American market accounted for a sizable revenue share in 2022. This is attributed to increased demand for OXO chemicals in the coating and painting industries. Many manufacturers in the United States and Canada use OXO chemicals because of their high solvency power, low volatility, and low toxicity, making them a viable alternative to other common solvents. Furthermore, the growing use of sustainable and high-performance coatings and paints drives demand for OXO chemicals and boosts market revenue growth. Furthermore, technical innovation in LP OXO technology is fueling market revenue growth. The United States is critical to applying disruptive technologies in the manufacturing sector. Furthermore, the significant usage of OXO chemicals for the synthesis of chemical derivatives by businesses in this region is boosting market revenue growth.
The Middle East and Africa oxo alcohol market is in its infancy, with potential growth connected to the region's economic development and industrialization. The market in this region is still evolving due to factors such as expanding economies, diversification attempts, and rising demand for petrochemical goods. Countries in the Middle East, such as Saudi Arabia and the United Arab Emirates, have begun ambitious economic diversification plans focusing on industries other than oil. Petrochemicals and chemicals play an important role, and oxo alcohols are required to produce various downstream products.
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The product segment is further segmented into N-butanol, 2-ethyl hexanol, and isobutanol.
N-butanol holds the major market share. N-butanol is a four-carbon alcohol known as regular butanol or n-butyl alcohol. It is a versatile chemical found in coatings, resins, and printing inks as a solvent. It also makes plasticizers, butyl acrylate, and other compounds. 2-Ethyl hexanol (2-EH) is a branched alcohol with eight carbons. It is a significant oxo alcohol utilized in manufacturing plasticizers and important plastic additives in the plastics industry. It's also used to make 2-EH acrylate, a basic material for coatings and adhesives.
The segment can be bifurcated by application into Acrylates, Glycol Ethers, Acetates, Lube Oil Additives, Resins, Solvents, and Plasticizers.
Acrylates are the most commonly used application. Acrylates made from oxo alcohols, such as 2-ethyl hexyl acrylate (2-EHA), make coatings, adhesives, and sealants. They improve these materials' adherence and flexibility. 2-EHA manufactures adhesives and sealants for construction, automotive, and industrial applications because of its high adhesive capabilities and weather resilience. Solvents from oxo alcohols are glycol ethers utilized in coatings, paints, cleaning goods, and industrial operations. They are good solvers for a wide variety of materials. Ethylene glycol butyl ether (EGBE) is utilized as a solvent in water-based coatings, inks, and cleansers because of its low volatility and compatibility with aqueous systems.
