Market Trends of Resorcinol Industry
This section covers the major market trends shaping the Resorcinol Market according to our research experts:
Soaring Demand from Tires
- The rising demand for rubber sector primarily from tires is boosting the market demand. Tires and Conveyors segment dominated a market with a share of more than 30%.
- Resorcinol is used in the production of adhesive resins for tires and the demand for the market studied is directly dependent on the tire production across the globe.
- Global tire production in 2019 reached almost 255 million units, which is a 5% increase from 2018 (where it posted growth of 6% from 2017). It is anticipated to grow at a CAGR of 2-3% over the forecast period.
- This positive scenario is majorly boosted by the growth momentum of replacement tires market, globally.
- Also, United States represents one of the largest and the most advanced tire market in the world by providing home to some of the largest tire manufacturers in the world, such as Goodyear Tire & Rubber Co., Cooper Tire & Rubber Co., Michelin and Bridgestone Americas Tire Operations (over 70% of the market share is reported with these four companies).
- The changes in the domestic tire manufacturing industry (tire size and structure) are putting new pressures on carbon black producers which creates more demand for tread blacks, but less for carcass blacks.
- Despite decline in the automotive industry across the globe, the tires segment still dominates the market.
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Asia-Pacific to Dominate the Market
- Asia-Pacific dominated the global market owing tot he robust demand from developing nations including China and India. The region being a manufacturing hub for automotive is of of the propelling factor for the resorcinol market growth in the region.
- However, declining automotive industry in the region is hindering the market growth.
- China is the world's largest automotive producer. However, the country witnessed about 4% decline in the production of vehicles. The automotive sales also declined by more than 5%
- The performance of the automotive industry was affected by the economic shifts and China's trade war with the United States. This trend continued in 2019, and the passenger and commercial vehicle sales further dropped by around 10%. However, rising sales of electric cars are likely to help the automotive market to avoid another slump.
- However, rising construction industry in the region is likely to supplement the demand for resorcinol during the forecast period.
- For instance, in the past few years, the Chinese construction industry developed rapidly, due to the central government's focus on infrastructure investment, as a means to sustain economic growth. The Chinese government rolled out massive construction plans, including making provision for the movement of 250 million people to its new megacities over the next 10 years, despite efforts to rebalance its economy to a more service-oriented form.
- Additionally, according to data from the Ministry of Statistics and Programme Implementation, the construction sector in India is tipped to slow its growth to 6.7% in 2019. It is also forecast to expand at an average of 6.6% annually through 2028. In addition, India is expected to become third-largest construction market, globally, by 2022.
- Such factors in turn are estimated to boost the demand for the resorcinol market during the forecast period.
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