Global Phosgene Market Size, Share & Trends Analysis Report By Derivative Type(Isocyanates, Chloroformates, Carbamoyl Chlorides, Others), By Application(Methylene Diphenyl Diisocyanate, Toluene Diisocyanate, Polycarbonate Resins, Others), By End-Users (Pharmaceuticals, Agrochemicals, Dyes, Fine Chemicals, Polycarbonates, Specialty Chemicals, Others) and By Region(North America, Europe, APAC, Middle East and Africa, LATAM) Forecasts, 2024-2032

Market Overview

The global phosgene market size was valued at USD 42.2 billion in 2023 and is projected to reach USD 64.2 billion by 2032, registering a CAGR of 5.4% during the forecast period (2024-2032). Increasing demand in the pharmaceutical, agrochemical, and polycarbonate industries and the growing use of platinum, uranium, niobium, and plutonium for metal extraction and their extensive application in various chemicals are significant drivers of worldwide market growth.

Phosgene is an odorless, colorless gas that is not combustible and has a scent similar to that of recently cut hay. However, primarily a synthetic substance, trace amounts of this chemical can be found in nature due to the degradation of chlorinated chemicals. Phosgene is utilized to produce several substances, including dyestuffs, isocyanates, polycarbonates, and acid chlorides. Additionally, it is employed in the manufacturing processes of insecticides and pharmaceuticals. Phosgene can also be used for ore separation. Phosgene is a gaseous substance at standard ambient temperature, but it can also be held in a liquid state under pressure or by cooling it.

The market is expected to develop due to the increasing population and rising spending power, leading to a higher demand for bedding and furnishings. Furthermore, the anticipated rise in the usage of the product in pesticides and insecticides is projected to enhance the market expansion in agricultural economies of the Asia-Pacific region. Moreover, the rising need for phosgene in the production of pharmaceuticals and the growing need for improved healthcare facilities is anticipated to drive the expansion of the global market.

Highlights

• Isocyanates generate the highest revenue share based on derivatives.
• Methylene Diphenyl Diisocyanate accounts for the largest market share by application.
• Specialty Chemicals contribute significantly to the market through end-users.

Market Dynamics

Global Phosgene Market Drivers:

Growing Pharmaceutical Industry Worldwide

The pharmaceutical sector researches, develops, manufactures, and distributes pharmaceuticals. The market has grown substantially over the past twenty years, resulting in global pharmaceutical revenues reaching 1.48 trillion U.S. dollars in 2022. The pharmaceutical sector consists of several prominent international corporations. Pfizer, a U.S. corporation, has been ranked among the top global pharmaceutical companies for many years based on its sales of prescription drugs. In 2022, the corporation earned over 100 billion U.S. dollars in total revenues with its international headquarters in New York City. 

In addition, the United States is home to many prominent pharmaceutical companies, so unsurprisingly, the country has the most significant national pharmaceutical market globally. Brazil experienced a robust yearly growth rate in the pharmaceutical sector among emerging markets in 2022. Nevertheless, the anticipated pharmaceutical sales indicate that the well-established markets in North America and Europe will continue to be at the forefront in the foreseeable future. Novartis, Roche, AstraZeneca, and Sanofi are among the most prominent European firms.

Furthermore, phosgene, a highly adaptable chemical molecule, is essential and irreplaceable in manufacturing many medications. It plays a crucial role in producing high-quality chemicals for creating different pharmaceutical goods with outstanding accuracy and effectiveness. With the global pharmaceutical sector rapidly expanding to satisfy the changing healthcare needs of a growing population, there will be a simultaneous increase in the demand for phosgene. The pharmaceutical industry has experienced significant growth due to the rising global population and increased healthcare needs. With the increasing complexity and prevalence of diseases, there is a growing need for highly effective treatments. Consequently, there is a demand for phosgene due to its crucial contribution to the manufacturing process of these life-preserving drugs.

Moreover, the discipline of medicinal chemistry is currently experiencing continuous investigation and advancement endeavors to create novel pharmaceuticals and enhance the effectiveness of current ones. The effort to develop new ideas and progress increases the need for phosgene.

Global Phosgene Market Restraints:

Health Hazards Associated with Phosgene

Exposure to phosgene can result in eye irritation, a dry and burning sensation in the throat, vomiting, coughing, production of foamy sputum, trouble breathing, and chest pain. Furthermore, individuals employed in diverse chemical, agrochemical, and pharmaceutical sectors may experience adverse effects due to exposure to phosgene. The extent of exposure is contingent upon the quantity, length, and nature of the task being performed.

Additionally, phosgene is a pulmonary toxicant that induces harm to the lungs' capillaries, bronchioles, and alveoli through decomposition, producing hydrochloric acid. The gas has minimal acute irritating effects on the respiratory tract, resulting in a shallow level of warning properties. Pulmonary edema, bronchopneumonia, and, in some cases, lung abscesses may occur. Subsequent occurrences of degenerative alterations in the nerves have been documented. An exposure lasting 30-60 minutes to a concentration of 25 parts per million (ppm) is considered harmful, whereas even a short exposure to 50 ppm can lead to quick fatality. The source of this information was the Environmental Protection Agency (EPA) in 1998. This aspect is expected to impede the growth of the phosgene market throughout the projected timeframe.

Global Phosgene Market Opportunity:

Rapid Urbanization and Growing Construction Activities

The urbanization process is rapidly increasing worldwide, with over 50% of the world's population residing in urban regions. The fast expansion of metropolitan areas necessitates substantial investment in infrastructure development and construction projects. The United Nations predicts that by 2050, around 68% of the global population will reside in urban areas, an increase from 55% in 2018. By 2030, more than 300 million individuals would be expected to relocate to urban areas in China, requiring extensive infrastructural initiatives. Likewise, the urban population in India is projected to reach 590 million by 2030. The rapid increase in urbanization necessitates substantial investment in infrastructure such as roads, bridges, railroads, airports, and utilities to accommodate the growing urban populations. 

In addition, phosgene is a primary raw material used predominantly in manufacturing plastics and insecticides. Most phosgene produced is intended for immediate or rapid consumption at the exact location where it is made. Phosgene produces methylene diphenyl diisocyanate (MDI) and toluene diisocyanate (TDI), both diisocyanate chemicals. These chemicals are then employed to create various polyurethane goods, such as flexible foam for upholstered furniture and rigid foam for insulation in walls and roofs. The global urbanization is occurring quickly, leading to increased infrastructure development and construction activities. Additionally, there is a significant rise in the usage of phosgene in the production of materials like polyurethane foam insulation, which is extensively used in construction projects.

Therefore, the increasing use of phosgene in producing materials like polyurethane foam insulation and the expansion of urban centers and infrastructure development projects in developed and developing economies are the main factors fueling market growth.

Utilization of Phosgene for Production of Agrochemicals Increasing Worldwide to Meet Food Security Requirements

There is an expected increase in agrochemical demand in the forecast period. The projected launch of solutions by leading phosgene manufacturers to meet the requirements of farmers is expected to increase the demand for phosgene from agrochemical companies. According to the Food and Agricultural Organization (FAO), the global food market is predicted to elevate by 50% to 90% by 2050 due to the projected population growth of 2.3 billion people. To meet this growing need, it is projected that global food production will need to expand by almost 70% by the year 2050. This implies a need to augment the production of certain food items substantially. By the year 2050, the production of grains is expected to rise to almost 3 billion metric tons, up from 2.1 billion metric tons in 2018.

Moreover, manufacturing agrochemicals, such as herbicides and pesticides, has increased to meet the growing demand for food security. The utilization of phosgene gas in the manufacturing of pesticides is anticipated to offer profitable prospects for phosgene.

Regional Analysis

The global phosgene market analysis is conducted across North America, Europe, Asia-Pacific, the Middle East and Africa, and Latin America.

Asia-Pacific Dominates the Global Market

Asia-Pacific is the most significant global phosgene market shareholder and is estimated to grow at a CAGR of 5.4% over the forecast period. The Asia Pacific area predominantly dominated the market. The regional market is experiencing substantial expansion due to a strong demand for agricultural products and an increasing trend towards commercializing agriculture to meet the expanding needs of the region's population. The Asia Pacific region has experienced a remarkable increase in agrochemical demand in 2023. This growth can be attributed to the need to improve agricultural output due to issues such as limited arable land, a growing population, and the impacts of climate change.

Additionally, the Asia-Pacific market is crucial, representing roughly 30% of the worldwide agrochemical business. Countries such as China and India, known for their substantial agricultural industries, strongly influence regional market consumption. China accounted for more than 50% of the agrochemical sales in the region, with India coming in a close second. In addition, the growing emphasis on environmental sustainability among consumers and producers and investments in promoting sustainable agricultural practices in countries such as China, India, and Indonesia have led to a significant increase in demand for agrochemicals, thereby driving the regional market. 

North America is anticipated to exhibit a CAGR of 5.7% over the forecast period. The North American region is projected to experience the fastest growth rate during the study period due to its well-developed infrastructure for chemical production and notable progress in production technologies and process enhancements, leading to more efficient and cost-effective manufacturing of phosgene. The chemical production infrastructure in North America is robust, characterized by notable technological progress and a highly advanced manufacturing foundation.

Furthermore, the United States, as the dominant chemical manufacturer in the region, possesses more than 13,000 chemical facilities. These facilities account for around 14% of worldwide chemical shipments, amounting to over USD 770 billion annually. Canada and Mexico both have significant contributions in the chemical sector. In 2021, Canada's chemical sales amounted to roughly CAD 53 billion, while Mexico's chemical business was valued at around USD 20 billion in the same year. Furthermore, the increasing prevalence of phosgene utilization in the production of various pharmaceutical substances, such as active pharmaceutical ingredients and intermediates, particularly in advanced economies, is driving the expansion of the local market. 

The European region is estimated to be the second largest market share holder in the global phosgene market during the forecast period. The region's growth is due to the high consumption of phosgene in pharmaceuticals, dyes, and specialty chemical applications. Germany is the leading country in the European region in terms of revenue share among European countries, followed by Spain, Italy, and France, because of the constant research and development and product innovation.

Segmental Analysis

The global phosgene market is segmented based on derivative, application, and end user.

The market is further segmented by derivative into Isocyanates, Chloroformates, and Carbamoyl Chlorides.

The isocyanates category had the biggest market share in 2023. The significant increase in demand for these derivatives in the construction and automotive sectors can be mainly attributed to the exponential growth in the automotive industry and the rapid rate of industrialization in major emerging economies like India and China. Additionally, the wide range of applications, including manufacturing rigid and flexible foams, paints and varnishes, and elastomers, has also contributed to the growing use of these derivatives. In addition, various industries, including automotive, construction, and furniture, have witnessed significant global growth in recent years.

In addition, isocyanates have gained considerable popularity and are being extensively used as essential raw materials in these industries due to their desirable qualities, such as durability, insulation, and flexibility. Consequently, the growth of these industries that use isocyanates, especially in developing countries, is increasing the demand for isocyanates and consequently propelling the isocyanates segment quickly.

Based on application, the market is fragmented into Methylene Diphenyl Diisocyanate, Toluene Diisocyanate, Polycarbonate Resins, and Others. 

The methylene diphenyl diisocyanate (MDI) category is expected to have a larger market share due to its use in various applications, such as cast elastomers, thermoplastic polyurethanes, and foam products. This growth is primarily driven by significant companies' efforts to improve energy efficiency in polyurethane foams, develop sustainable and environmentally friendly formulations, and discover new applications for MDI in different sectors.

The polycarbonate resins segment is expected to experience significant growth in the upcoming years. This is due to the increasing demand for lightweight and durable materials in automobiles and the rising popularity of polycarbonate resins. These resins offer high impact strength and heat resistance advantages, making them suitable for various automotive applications, including interior trim components, lighting, and exterior parts.

The market is classified by end-users into Pharmaceuticals, Agrochemicals, Dyes, Fine Chemicals, Polycarbonates, Specialty Chemicals, and Others.

The specialty chemicals category is predicted to dominate the market by 2023. The introduction of phosgene as a significant raw material in producing specialty polycarbonates is a crucial factor contributing to the increased demand for these carbonates in many industries such as construction, automotive, medical, and electronics. Furthermore, the increasing adoption of research and development (R&D) initiatives to enhance the effectiveness, environmental friendliness, and safety of phosgene-based procedures is expected to broaden the market potential and stimulate the need for specialty chemicals.

The agrochemicals segment led the industry market with a substantial share in 2023 and is likely to expand further at a significant growth rate over the next coming years; the growing need for increased crop productivity and the increasing support from government agencies for the use of agrochemicals are essential factors driving the acceleration of this trend. These measures aim to assure food safety and encourage sustainable farming practices.

Recent Developments

• March 2024- Bayer's Pharmaceutical Division embarked on its next growth phase, reshaping its executive Leadership Team to become more mission-centric and value-focused.
• March 2023 - Dow (NYSE: DOW), a prominent player in materials science, and Beyond Benign, a nonprofit organization dedicated to incorporating green chemistry into education, declared an extended partnership spanning many years. With a focus on collaboration, both organizations strive to enhance chemistry education by equipping educators with the necessary skills and resources to integrate green chemistry into higher education curricula.