Toluene Market
Toluene Market Analysis, By Grade (<98% and >98%), By End Use Industry and Region - Global Market Insights 2023 to 2033
Analysis of Toluene Market Covering 30+ Countries Including Analysis of US, Canada, UK, Germany, France, Nordics, GCC countries, Japan, Korea and many more
Toluene Market Growth Outlook (2023 to 2033)
Toluene is a mixture of long-chain hydrocarbons and it is used as a blending component for premium gasoline and for the production of benzene and Xylol. It is also used as a plasticizer, chemical intermediate, and polyester intermediate. It is an aromatic hydrocarbon that is widely used as an industrial feedstock.
Toluene is an effective solvent as, unlike water, it can dissolve many organic compounds. In many commercial products, toluene is used as a solvent that is present in paint thinners, nail polish remover, glues, and correction fluid. It is a very common component in substances like gasoline, glue, and other products.
With the diverse application of toluene, the market is expected to grow at a CAGR of 6.1% and is likely to create an absolute $ opportunity of US$ 20.2 billion in the coming years.
Report Attributes | Details |
---|---|
Toluene Market Size (2022A) |
US$ 22.3 Billion |
Estimated Market Value (2023E) |
US$ 23.6 Billion |
Forecast Market Value (2033F) |
US$ 42.5 Billion |
Global Market Growth Rate (2023-2033) |
6.1% CAGR |
North America Market Share Growth Rate (2023-2033) |
5.6% CAGR |
Europe Market Forecast Market Value (2033F) |
US$ 11.1 Billion |
Key Companies Profiled |
|
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Historic and Future Pathway Analysis for the Toluene Market
Toluene is an aromatic hydrocarbon with the chemical formula C7H8. It is a clear, colorless liquid with a sweet, benzene-like odor. Toluene is derived from petroleum and is primarily used as an industrial solvent. It is sometimes used as an octane booster in gasoline. It enhances the combustion properties of gasoline and helps to improve engine performance. However, its use as a fuel additive is regulated due to environmental and health concerns.
- Short Term (2023-2026): The growing coatings and adhesives industry is expected to drive the toluene market growth in the coming years. Toluene is a key component in the production of solvents used in coatings and adhesives. As the demand for these products increases, so does the demand for toluene, leading to market growth and expansion in the toluene industry.
- Medium Term (2026-2029): The growing pharmaceutical industry in emerging economies fuels the demand for toluene, a key chemical used in the production of various drugs and medications.
- Long Term (2029-2033): Efforts led by market players in the toluene market, such as strategic partnerships and expanding distribution networks, drive long-term market growth. These initiatives enhance product quality, increase market reach, and foster sustainable development, ultimately attracting more customers and stimulating demand for toluene-based products.
On the back of the aforementioned facts, the toluene market is anticipated to grow at a CAGR of 6.1% during the forecast period from 2023-2033, According to the Fact.MR, a market research and competitive intelligence provider.
Market share analysis of toluene based on end-use industry and region is provided in a nutshell in the above image. Under the end use industry segment, the chemicals & petrochemicals industry sub-segment dominates with a 32.1% market share in 2023.
Market Dynamics Outlook
“Pullulating Electrical & Electronics Industry to Drive Toluene Demand”
Toluene is widely used as a solvent in the manufacturing of electronic components and devices. It is utilized in processes such as cleaning, degreasing, and thinning of coatings, adhesives, and resins. The expanding electronics industry, including the production of semiconductors, printed circuit boards (PCBs), and electronic components, drives the demand for toluene as a solvent.
Toluene is a key raw material for the production of polystyrene, a versatile plastic used in various applications, including electrical and electronic equipment. Polystyrene is used to manufacture computer housings, appliances, packaging materials, and insulation products. The growth of the electrical and electronics sector increases the demand for polystyrene, which, in turn, drives the demand for toluene.
“Factors Restraining the Growth of the Toluene Market”
Toluene is a major solvent used across the paints & adhesive industry but there are many hindrances to the market growth. Toluene is similar to green chemicals but lacks the coordinating oxygen of the oxolane family of solvents. For instance, Ethyl lactate has replaced solvents such as toluene, acetone, and xylene because its bio-based and doesn’t harm the environment like toluene.
Different regulations and sanctions implied by the EU and North America, in order to meet zero-carbon footprint by 2050, have created a setback for the market. Similarly, Bureau of Indian Standards (BIS) and FSSAI (Food Safety and Standards Authority of India) have banned the usage of toluene in food packaging printing ink. It has been due to the hazardous nature of the chemical and its adverse health effects.
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Country-wise Insights
What are the Factors Driving Toluene Demand across India?
The growing Indian pharmaceutical industry has a significant impact on the demand for toluene. India's position as the largest provider of generic medicines globally drives the production of pharmaceuticals in the country, leading to an increased demand for raw materials and solvents like toluene.
Toluene is commonly used as a solvent in the pharmaceutical industry due to its excellent solvent properties, including its ability to dissolve a wide range of compounds. It is used in various stages of drug manufacturing, such as extraction, purification, and formulation processes. Toluene helps in the extraction of active pharmaceutical ingredients (APIs) from natural sources and aids in the formulation of drugs in liquid or solid dosage forms.
As a result, the robust growth of the Indian pharmaceutical industry, fueled by its global exports and leadership in generic medicines, drives the demand for toluene as a vital solvent in the production and formulation of drugs.
Why US’ Toluene Market is Flourishing?
With the rising investment in oil and gas energy, there will be a parallel expansion of China's refining and petrochemical industry. Toluene is a vital raw material in the production of various chemicals, including benzene, xylenes, and other aromatic compounds. The growth of the refining and petrochemical sectors will consequently drive the demand for toluene.
Further, toluene can also serve as a feedstock for energy production, particularly in the form of toluene diisocyanate (TDI). TDI is used in the production of polyurethane foams and coatings, which are widely used in construction and automotive industries. As China invests in renewable energy sources, there may be a need to produce energy-storage materials or alternatives, where toluene-based products like TDI could play a role. This could further drive the demand for toluene.
Category-wise Insights
Why <98% Grade Toluene is Widely Preferred?
<98% grade toluene is typically less expensive compared to higher purity grades. It is often used in applications where the exact purity level is not critical. Industries looking for cost-effective solutions prefer <98% grade toluene as a suitable alternative to higher purity grades, especially when stringent purity requirements are not necessary.
Toluene is widely used as a solvent in various industries such as paints, coatings, adhesives, and printing inks. In certain solvent applications, the exact purity level of toluene may not significantly impact the performance or quality of the final product. Consequently, industries opt for <98% grade toluene to meet their solvent requirements while minimizing costs.
<98% grade toluene is expected to account for a market share of 88.9% in 2023.
Which End-Use Industry is Gaining Traction in Toluene Market?
The chemicals and petrochemicals industry is expected to account for a market share of 32.1% in 2023, growing at a CAGR of 6.4% during the forecast period.
Toluene serves as a crucial raw material in the production of a wide range of chemicals and petrochemicals. It is a vital component in the synthesis of benzene, xylenes, and other aromatic compounds. These compounds find applications in the manufacturing of solvents, adhesives, coatings, polymers, resins, dyes, pharmaceuticals, and many other products. As the demand for these chemicals and petrochemicals increases, so does the demand for toluene.
Further, toluene possesses excellent solvent properties, making it valuable in various industries. It is used as a solvent in paints, coatings, varnishes, printing inks, and adhesives. As the chemicals and petrochemicals industry expands, the demand for solvents like toluene also rises, driving the growth of the toluene market.
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Eminent Player’s Key Stratagems
Prominent players operating in the toluene market are Arkema SA, Eastman Chemicals Company, Exxon Mobil, LG Chem, Mitsubishi Chemical Corporation, Reliance Industries Limited, and Shell Global.
Companies focusing on expanding their production capacity to meet the increasing demand for toluene. This strategy involves investing in new manufacturing facilities or upgrading existing ones to enhance production capabilities. Expanding production capacity allows companies to cater to a larger customer base and seize market opportunities.
Fact.MR has provided detailed information about the price points of key manufacturers of toluene positioned across regions, sales growth, production capacity, and speculative technological expansion, in the recently published report.
Segmentation of Toluene Industry Research
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By Grade :
- <98%
- >98%
-
By End-Use Industry :
- Chemicals & Petrochemicals
- Plastics & Rubber
- Energy (Oil & Gas)
- Pharmaceuticals
- Electrical & Electronics
- Coatings & Adhesives
- Others
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By Region :
- North America
- Latin America
- Europe
- East Asia
- South Asia & Oceania
- Middle East & Africa
- FAQs -
What is the Expected Valuation Market Likely to Reach by 2033?
The toluene market is likely to reach a valuation of US$ 42.5 billion by the end of 2033.
Which Grade is Expected to Account for a Major Market Share?
<98% type is expected to dominate the toluene market accounting for a market share of 88.9% in 2023.
What is the Expected Absolute Dollar Opportunity Created by the North America Toluene Market?
The North American toluene market is likely to create an absolute $ opportunity of US$ 3.5 billion.
Which End Use Industry Has High Demand for Toluene?
The chemicals & petrochemicals industry is expected to hold a market share of 32.1% in 2023.
At what Rate Toluene Market is Likely to Grow?
The toluene market is likely to grow at a rate of 6.1% and create an absolute $ opportunity of US$ 20.2 billion during the forecast period.