DIMER ACIDS MARKET ANALYSIS

Market Challenges And Opportunities

Dimer Acids Based Market Drivers:

• Rise in infrastructure development activities: The infrastructure sector across the world has been booming in recent years, with many countries focusing on improving transportation, housing, and energy infrastructure. Dimer acid plays a key role in the production of construction adhesives, paints, and coatings, which see extensive use in infrastructure projects. The future also looks promising for dimer acid, driven by sustained infrastructure expansion. Many countries have outlined massive infrastructure development plans over the next 5-10 years under initiatives like the National Infrastructure Pipeline in India, InfraCo Africa project, and Belt and Road Initiative led by China. These projects involve investments covering roads, railways, ports, airports, power plants, and urban development.
• Increasing demand for polyamide resins: The demand for polyamide resins has been rising significantly over the past few years across various industries, such as coatings, adhesives, and engineering plastics. Polyamide resins find wide usage in these applications due to properties like abrasion resistance, toughness, and mechanical strength. Dimer acid is a key raw material that is used in the production of polyamide resins. It acts as a molecular bridge between polymer chains and improves the resin's performance.

Dimer Acids Based Market Opportunities:

• Emerging applications of dimer acid in coatings, printing inks, and lubricants: Emerging applications of dimer acid in various industries present a huge opportunity for the dimer acid market to grow significantly. Dimer acids, which are dimerized fatty acids, have been traditionally used in the production of resins for adhesives and coatings. However, more innovative applications are being discovered now that can potentially open up new avenues of growth. Dimer acids are now increasingly finding applications in printing inks due to their unique combination of properties like flexibility, adhesion, and corrosion resistance.
• Growing demand from developing nations: The growing demand from developing nations could provide a major opportunity for the dimer acid market. Countries such as China, India, Brazil, Indonesia, and others in Asia Pacific and Latin America are experiencing rapid economic and industrial growth. As incomes rise in these emerging economies, demand for consumer and industrial goods is increasing tremendously.

Dimer Acids Based Market Restraints:

• Fluctuations in crude oil prices: The volatility in crude oil prices has emerged as a major challenge for the dimer acid based product market. Dimer acid, which is primarily used in polymer and adhesive industries, is derived from natural fatty acids found in soybean and rapeseed oils. Hence, fluctuations in crude oil prices have a direct impact on the upstream raw material costs for dimer acid production.
• Counter balance: Develop the capability to adjust product formulations based on the availability and cost of various raw materials, enabling the use of alternative inputs when crude oil prices are high.
• Stringent environment regulations: Stringent environment regulations regarding emissions levels and usage of toxic chemicals are posing a major challenge for the growth of dimer acid market. Dimer acid, which is a major component used in resin production, is derived from tall oil fatty acids obtained from pine trees. The refining process to extract and convert tall oil fatty acids into dimer acid emits volatile organic compounds (VOCs), which are harmful air pollutants. Many countries and regions across the globe have been tightening their environmental standards and emission limits on VOCs over the past few years.
• Counter balance: Invest in research and development to create more environmentally friendly dimer acid products, such as bio-based or renewable raw material sources.