South East Asia Oleochemicals

South East Asia Oleochemicals Market Research Report: Forecast (2022-27)

By Type (Fatty Acids Fatty Acid Methyl Esters (Biodiesel), Fatty Alcohol, Isostearic & Stearic Acids, Others (Fatty Amines, Glycerol)) By End Users (Chemicals (Surfactants, Lubricants, Coatings, Resin Read more

  • Chemicals
  • Apr 2022
  • 143
  • CM10262

Market Definition

Oleochemicals are chemical compounds derived through vegetable fats or oils. The splitting of fats through water-based hydrolysis, alcohol-based hydrolysis, and hydrogenation are some common ways of producing oleochemicals. These chemical compounds have a wide application in industrial manufacturing of personal care, home care, health care, chemicals, textiles, etc.

Market Insights

The Southeast Asia Oleochemicals Market is anticipated to grow at a CAGR of around 3.38% in terms of volume during the forecast period, i.e., 2022-27, says MarkNtel Advisors. Owing to the wide application of oleochemicals the Southeast Asia Oleochemicals market has witnessed robust growth during the historical period. Furthermore, the soaring investments & increasing establishment of production units of cosmetic products, chemicals (lubricants, coatings, etc.), pharmaceutical industries, etc., have also boosted the demand for oleochemicals. Moreover, the increasing construction activities in the region are also one of the prominent factors attributing to the growth of local paint manufacturing in Vietnam & Singapore, which, in turn, has further influenced the Southeast Asia Oleochemicals market.

Report Coverage Details
Study Period Historical Data: 2017-20
Base Year: 2021
Forecast Period: 2022-27
CAGR 3.38%
Country Covered Malaysia, Singapore, Thailand, Vietnam, Indonesia, Rest of SEA
Key Companies Profiled Croda International PLC, Philippine International Development, Inc. , Cargill, Kao Chemicals, KLK OLEO, Evonik, Emery Oleochemicals Asia Sdn. Bhd., Wilmar International, Corbion NV, Others
Unit Denominations USD Million/Billion

 

Additionally, the foreign direct investments (FDIs) in the region have also assisted in the development of the market. The key industries that have received a notable amount of FDIs are pharmaceuticals, chemicals, and food & beverages, in line with the Association of Southeast Asian Nations. During 2019-2020, Nestlé invested more than USD122 million in Indonesia & Malaysia for the expansion of its existing production capacity.

Further, in the same period, Nippon Shokubai and Sinochem invested approximately USD357 million in the establishment & development of acrylic acid & bioplastic in Indonesia & Thailand, respectively. Nevertheless, such financing in the region has implied a considerable growth of the market in the past period as well as a continuous steady increase in the market revenues & volume of oleochemicals in the forthcoming years.

Key Trend in the Market

Oleochemicals Replacing Petroleum Derived Ingredients

Oleochemicals are one of the key materials required by the manufacturers of home & personal care products. These chemicals are considered to have a minimal impact on the human body. Therefore, home & personal care companies are gradually moving towards using natural ingredients, which are safe on human skin while in use, rather than using harsh chemicals. Moreover, the consumer awareness to minimize the use of toxic elements on the skin is also contributing to the demand for all-natural & plant-based soaps & detergents. Therefore, Oleochemicals are emerging as a substitute for petrochemical-derived ingredients used in the personal care industry in the region. Further, Oleochemicals end-users are replacing petroleum-derived products to minimize their carbon footprints.

Impact of Covid-19 on the Southeast Asia Oleochemicals Market

FMCG is one of the most important end-user of the market, however, the market witnessed a marginal dip during the outbreak of the COVID-19 pandemic in 2020, primarily due to the disruption in the supply chain hampering the logistics of raw materials & finished goods. Furthermore, due to the pandemic, palm oil production has decreased. Eventually, the major disruption in the supply chain at all levels & across all regions impacted the growth of the regional oleochemicals market. However, the market began to recover in the latter half of 2020. The surge in drug & pharmaceutical manufacturing has resulted in an increase in demand for oleochemicals due to the use of oleochemicals in topical & oral medicine as well as drug formulation.

Furthermore, oleochemicals are used as emulsifiers, wetting agents, solubilizers, and cream bases, which are necessary components in the drug manufacturing process. The region has a broadened manufacturing base that has been fulfilling the domestic as well as the export demand. Besides, the growth in the pharmaceutical exports in the region aided in sustaining the oleochemicals market revenues during the pandemic period.

Market Segmentation

Based on the Type:

  • Fatty Acids
  • Fatty Acid Methyl Esters (Biodiesel)
  • Fatty Alcohol
  • Isostearic & Stearic Acids
  • Others (Fatty Amines, Glycerol)

Of them all, Fatty Acids captured a consequential share in the market, owing to the heavy production of palm oil in the region since 2017. The fatty acids are formed by the hydrolysis of fats & oils in which the triglycerides are further broken into fatty acids & other compounds. The major sources of fatty acids are palm oil, soya oil, castor oil, etc. Furthermore, Malaysia, Indonesia, and Thailand are the main producers of palm oil in the region.

Moreover, the plantation of small-scale palm oil farms has soared considerably in the region, backed by the increasing demand for palm oil in the international markets. Eventually, its final products such as fatty acids are also registering an uptrend.  As per EFECA, in 2018, Thailand had more than 120,000 small farm holders. Hence, the abundant production & supply of palm oil has emerged as an efficient solution for the production of fatty acids-based oleochemicals in the region.

Based on End Users:

  • Chemicals
  • Food & Beverage
  • Personal Care & Cosmetics
  • Home Care
  • Rubber & Plastics
  • Textiles
  • Pharmaceuticals
  • Others (EOR, etc.)

Among these, Food & Beverage acquired a notable share in the Southeast Asia Oleochemicals market during the historical period, owing to the continual growth in the food & beverage industry. The growing demand for packaged foods, bakery, and confectionery products such as chocolates, cakes, ice creams, candies, etc., and condiments such as ketchup, cheese, etc., have been fueling the manufacturing quantities in the regions, and ultimately the market for oleochemicals in the region.

Furthermore, the set-up of new as well as the expansion of prevailing food & beverage manufacturing plants in the region to satiate the increasing food demand is expected to maintain the market growth for the forthcoming years. For Instance, in 2021, IFF (Nutrition & Biosciences company) announced the expansion of its flavor manufacturing unit in Karawang, Indonesia, with a total investment of approximately USD87 million.

Regional Landscape

Based on the Geography, the Southeast Asia Oleochemicals market expands across:

  • Malaysia
  • Singapore
  • Thailand
  • Vietnam
  • Indonesia
  • Rest of SEA

Of all regions, the Malaysia Oleochemicals market depicted substantial growth during the historical period. The factors validating the growth have been the booming food & beverage, chemicals, pharmaceuticals, oil & gas, etc. Moreover, the development in the automotive industry has been fueling the demand for paints, lubricants, and resins, as well as their local production in the country, which, in turn, has induced the demand for oleochemicals. According to Malaysia Automotive, Robotics, and IoT Institute (MARii), in 2018, the highest level of exports of automotive parts & components from Malaysia was recorded at nearly USD2.9 billion. Malaysia is also one of the global supplier of palm oil to the countries in South Asia, Europe, and East Asia. Furthermore, the existence of some prominent oleochemical manufacturers (Emery Oleochemicals, Iffco Malaysia, Acidchem International, etc.) meeting domestic needs & foreign supplies is also one of the reasons for the continuous development of the Malaysian Oleochemicals market.

Recent Developments by the Leading Companies

  • In 2021, IFF (Nutrition & Biosciences company) announced the expansion of its flavor manufacturing unit in Karawang, Indonesia, with a total investment of approximately USD87 million.
  • Cargill announced to invest around USD200 million in Indonesia to build a palm oil refinery with the purpose of increasing the availability of edible oil ingredients.

Market Dynamics:

Key Drivers: Surging Demand for Bio-based Chemicals to Replace Petrochemicals

The inclination towards green, eco-friendly products has surged the demand for oleochemicals in various industries for the manufacturing of routinely used products. The key industries following the trend are homecare, healthcare, chemicals, etc. Moreover, bio-based ingredients are non-toxic, and thus non-harmful for the human skin, which has given the rise in demand for the oleochemicals in soaps, detergents, floor cleaners, etc. Further, Thailand & Indonesia have been the fastest-growing region for the application of bio-based chemicals for bio-based soaps & detergents.

Possible Restraint: Fluctuating Feedstock Prices Leads to Volatility in Oleochemicals Prices

The feedstock for oleochemicals is palm oil, soybean oil, castor oil, etc. Even though the region has abundant palm oil farming, the prices of palm oil had been volatile in the region, driven by geopolitical events. Further, in line with the recent event of the Russia-Ukraine war, a major supply hit has been experienced by the oleochemicals manufacturers. Moreover, to curb the impact of the unprecedented event, the government of Indonesia has implemented a new law to limit exports by palm oil suppliers in order to satiate the domestic demand. However, the high demand & low supply of palm oil in other countries of the region has resulted in volatile prices, affecting the procurement prices of palm oil by the oleochemical companies.

Key Questions Answered in the Market Research Report:

  1. What are the overall statistics or estimates (Overview, Size- By Value & Volume, Forecast Numbers, Segmentation, Shares) of the Southeast Asia Oleochemicals Market?
  2. What are the country-wise industry size, growth drivers, and challenges?
  3. What are the key innovations, opportunities, current & future trends, and regulations in the Southeast Asia Oleochemicals Market?
  4. Who are the key competitors, their key strengths & weaknesses, and how do they perform in the Southeast Asia Oleochemicals Market based on the competitive benchmarking matrix?
  5. What are the key results derived from the surveys conducted during the Southeast Asia Oleochemicals Market study?

Frequently Asked Questions

A. The Southeast Asia Oleochemicals Market is projected to grow at a CAGR of around 3.38% during 2022-27.

A. The Personal Care end-user is anticipated to emerge as an area of remunerative opportunities for the leading players in the Southeast Asia Oleochemicals Market during 2022-27.

A. The region being viewed as a lucrative manufacturing place due to high-tech manufacturing units & skilled workforce is expected to be a key reason of advancement through 2022. The increasing FDI investments in the region for the diversification & development of the end-user industries in the region is predicted to act as an important area of growth for the market.

A. With the occurrence of the COVID-19 pandemic, the market witnessed a sudden spike in the regional pharmaceutical manufacturing, which continued during 2021-22. Therefore, the perennial growth in pharmaceutical manufacturing, owing to COVID-19 would boost the regional demand for oleochemicals.

  1. Introduction
    1. Research Process
    2. Assumption
    3. Market Segmentation
    4. Market Definition
  2. Executive Summary
  3. Impact of COVID-19 on South East Asia Oleochemicals Market
  4. South East Asia Oleochemicals Market Trends & Insights
  5. South East Asia Oleochemicals Market Dynamics
    1. Growth Drivers
    2. Challenges
    3. Impact Analysis
  6. South East Asia Oleochemicals Market Hotspot and Opportunities
  7. South East Asia Oleochemicals Market Supply Chain Analysis
  8. South East Asia Oleochemicals Market Policies, Regulations, Material Type Standards
  9. South East Asia Oleochemicals Market Outlook, 2017- 2027F
    1. Market Size and Analysis
      1. By Revenues
      2. By Volume (in Tons)
    2. Market Share and Analysis
      1. By Type
        1. Fatty Acids
        2. Fatty Acid Methyl Esters (Biodiesel)
        3. Fatty Alcohol
        4. Isostearic & Stearic Acids
        5. Others (Fatty Amines, Glycerol)
      2. By End Users
        1. Chemicals (Surfactants, Lubricants, Coatings, Resins, etc.)
        2. Food & Beverage (Human & Animal Nutrition)
        3. Personal Care & Cosmetics
        4. Home Care (Soaps, Detergents, etc.)
        5. Rubber & Plastics
        6. Textiles
        7. Pharmaceuticals
        8. Others (EOR, etc.)
      3. By Country
        1. Malaysia
        2. Singapore
        3. Thailand
        4. Vietnam
        5. Indonesia
        6. Rest of SEA
      4. By Company
        1. Competition Characteristics
        2. Market Share & Analysis
  10. Malaysia Oleochemicals Market Outlook, 2017-2027F
    1. Market Size & Analysis
      1. By Revenues
      2. By Volume (in Tons)
    2. Market Share and Analysis
      1. By Type
      2. By End Users
  11. Singapore Oleochemicals Market Outlook, 2017-2027F
    1. Market Size & Analysis
      1. By Revenues
      2. By Volume (in Tons)
    2. Market Share and Analysis
      1. By Type
      2. By End Users
  12. Thailand Oleochemicals Market Outlook, 2017-2027F
    1. Market Size & Analysis
      1. By Revenues
      2. By Volume (in Tons)
    2. Market Share and Analysis
      1. By Type
      2. By End Users
  13. Vietnam Oleochemicals Market Outlook, 2017-2027F
    1. Market Size & Analysis
      1. By Revenues
      2. By Volume (in Tons)
    2. Market Share and Analysis
      1. By Type
      2. By End Users
  14. Indonesia Oleochemicals Market Outlook, 2017-2027F
    1. Market Size & Analysis
      1. By Revenues
      2. By Volume (in Tons)
    2. Market Share and Analysis
      1. By Type
      2. By End Users
  15. South East Asia Oleochemicals Market Key Strategic Imperatives for Success and Growth
  16. Competitive Outlook
    1. Competition Matrix
      1. Material Type Portfolio
      2. Brand Specialization
      3. Target Markets
      4. Target Material Types
      5. Research & Development
      6. Strategic Alliances
      7. Strategic Initiatives
    2. Company Profiles (Business Description, Material Type Segments, Business Segments, Financials, Strategic Alliances/ Partnerships, Future Plans)
      1. Croda International PLC
      2. Philippine International Development, Inc.
      3. Cargill
      4. Kao Chemicals
      5. KLK OLEO
      6. Evonik
      7. Emery Oleochemicals Asia Sdn. Bhd.
      8. Wilmar International
      9. Corbion NV
      10. Others
  17. Disclaimer
South East Asia Oleochemicals Market Segmentation