CHLOR-ALKALI MARKET ANALYSIS

Market Size and Trends

The global chlor-alkali market is estimated to be valued at USD 71.50 Bn in 2024 and is expected to reach USD 95.37 Bn by 2031, growing at a compound annual growth rate (CAGR) of 4.2% from 2024 to 2031.

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The global chlor-alkali market is expected witness steady demand driven by growth in end-use industries such as chemical processing, water treatment, pharmaceutical, paper & pulp and others. Within the chemicals industry, chlor-alkali is a critical building block material that serves as a key raw material for the production of numerous essential chemicals including polyvinyl chloride (PVC), ethylene dichloride (EDC), caustic soda, alumina, and titanium dioxide among others. Rapid industrialization and infrastructural development activities across emerging economies are expected to drive the demand for such derivatives, supplementing revenue generation in the global chlor-alkali market over the coming years.

Growing demand from water treatment industry

The water treatment industry is witnessing rising demand with growing global population and urbanization. Access to clean drinking water has become increasingly important for public health. The chlor-alkali market is benefiting from this demand as its products like chlorine and sodium hydroxide are extensively used in water treatment systems.  Chlorine is used as a disinfectant to kill bacteria and other microorganisms in water. It acts as a potent sterilizing agent and helps ensure water reaching homes and industrial facilities is purified and safe for consumption. This application of chlorine in water treatment has been rising in both developed and developing nations across the world. For example, according to United Nations Children's Fund (UNICEF) data in 2020, over 800 million people around the world lack basic drinking water services and water disinfection needs augmentation. As more communities are to be provided access to safe water in coming years, the consumption of chlorine is projected to rise further. In addition to chlorine, the increasing complexity of water generated from various sources like surface water, seawater, and industrial wastewater has necessitated advanced treatment methods that employ caustic soda (sodium hydroxide) on a large scale. Sodium hydroxide is used for pH adjustment and removal of contaminants like heavy metals through processes like coagulation and precipitation. It plays a vital role in secondary and tertiary levels of water treatment. Considering the growing freshwater scarcity and water quality challenges facing many parts of the world due to climate change, industrialization and pollution as highlighted in UN Water reports, the usage of sodium hydroxide in water treatment applications is expected to see significant gains over the coming decade. This augurs well for the overall growth of the chlor-alkali industry.

Another major end-use segment where chlor-alkali chemicals find application is in the production of numerous organic chemicals. Chlorine is used as a raw material or intermediate in the manufacturing of several commodity chemicals like vinyl chloride monomer (VCM), ethylene dichloride (EDC), polyvinyl chloride (PVC) resins, ethylene, propylene oxide, and others. These chemical intermediates further serve as basic building blocks for myriad industrial and consumer products. In recent years, there has been substantial growth in global organic chemical production due to expanding end-use markets like consumer durables, automotive, packaging, construction, and agrochemicals. Developing regions across Asia Pacific and Latin America have also witnessed big surge in manufacturing activities which has boosted the domestic demand for organic chemicals. Chemical companies are making large investments in organic chemical facilities to serve both domestic and international clients. This rising production of organic chemicals worldwide will keep the demand for chlorine and chlor-alkali products vigorous in the long run.