MONOCHLOROACETIC ACID MARKET ANALYSIS

The availability of substitutes is significantly restraining the growth of the global monochloroacetic acid market. Monochloroacetic acid is predominantly used for the production of carboxyl methyl cellulose (CMC) which is an important chemical for many end-use industries. However, other cellulose ether derivatives such as hydroxyethyl cellulose (HEC) and hydroxypropyl cellulose (HPC) are emerging as viable substitutes for CMC. Both HEC and HPC offer similar properties as CMC including thickening, binding, and emulsifying abilities. Additionally, they have better stability over a wider pH range as compared to CMC. Many end-use industries are inclined towards replacing CMC with HEC and HPC in their formulations due to their superior chemical properties. For instance, the paper industry which is a key end-user of CMC is substituting nearly 10% of CMC with HEC and HPC annually according to estimates from the FAO. This is negatively impacting the demand for monochloroacetic acid which is predominantly consumed for CMC production. The availability of close substitutes is likely to restrain the monochloroacetic acid market growth in the coming years.

Market Opportunities: Potential growth in emerging economies

The emerging economies across Asia, Africa and South America showcase tremendous potential for growth in the global monochloroacetic acid market. With rising disposable incomes and robust economic expansion, demand for consumer goods, textiles, and other end-use applications is surging in these developing regions.  According to data from the World Bank, the GDP growth rates of several developing nations such as India, Indonesia and Vietnam exceeded 5% annually during the period of 2020 to 2022. Rapid industrialization and infrastructure development alongside a huge young population are driving consumption as well as manufacturing activity. Since monochloroacetic acid is a widely used intermediate in the production of detergents, drugs, dyes and Crop Protection chemicals, its consumption is expected to climb significantly alongside economic progress in emerging territories.