Global Naphthenic Acid Market Is Estimated To Witness High Growth Owing To Increasing Demand For High-Performance Lubricants and Growing Oil Extraction Activities
The global naphthenic acid market is estimated to be valued at USD 72.5 Mn in 2024, exhibiting a CAGR of 2.4% over the forecast period (2024-2031). Naphthenic acids have wide applications in lubricants, wood preservatives, and insulation oils. Furthermore, demand from the oilfield chemicals industry will continue to drive the market growth.
Market Dynamics:
The global naphthenic acid market is driven by the growing demand for high-performance lubricants and increasing oil extraction activities. Naphthenic acid finds wide utilization in manufacturing industrial and automotive lubricants due to its excellent anti-corrosion and water dispersibility properties. Hence, rising need for advanced lubricants from various end-use industries is fueling the market growth. Additionally, with increasing oil extraction projects worldwide, the demand for oilfield chemicals including naphthenic acid is also growing significantly. Naphthenic acid is used as an additive in drilling fluid formulation to control corrosion and viscosity.
Increasing Demand from the Paints and Coatings Industry is Driving the Global Naphthenic Acid Market
The paints and coatings industry has been witnessing strong growth over the past few years. Naphthenic acid is widely used as a dispersing agent and rust inhibitor in paints and coatings. It helps to improve the durability, gloss and adhesion of paints. Rising construction activities along with growing automotive production across major economies such as China, India, the U.S., Germany, etc. is contributing to the increasing demand for paints and coatings. This, in turn, is augmenting the consumption of naphthenic acid. The growing use of naphthenic acid-based paints and coatings in industries like marine, aerospace, and oil & gas is another key factor propelling the market growth.
Increasing Applications in Lubricant Production is Fueling Market Growth
Lubricants account for a significant share of the overall naphthenic acid consumption. Naphthenic acid acts as a viscometer and dispersant in lubricating greases and oils. It improves film strength, anti-wear properties, and rust prevention. The ever-growing automotive industry is driving the lubricant demand tremendously. Moreover, rapid industrialization and infrastructure growth is increasing the usage of machinery and heavy equipment which require effective lubrication. This is having a positive impact on the naphthenic acid market. New applications are also being explored in synthetic-based lubricants which provide opportunities to further expand the product's demand from lubricants segment.
Stringent Environmental Regulations May Limit Market Growth
Naphthenic acid is slightly toxic in nature and may cause adverse effects on aquatic life and environment if released untreated. Many countries and regions have formulated stringent regulations regarding its production, storage, transportation, and disposal. For example, the European Union has classified naphthenic acid as dangerous for the environment under EC regulation 1272/2008. Such restrictive norms compel producers and end users to invest in pollution control technologies and safety handling systems which increase the overall production cost. This acts as a restraint while smaller producers find it difficult to comply with regulations. Moreover, growing environmental concerns are pushing manufacturers to develop bio-based and environment-friendly substitutes which can replace naphthenic acid over the long term.
Fluctuating Crude Oil Prices Pose Uncertainty
Crude oil is the primary raw material required for naphthenic acid production through vacuum distillation process. Therefore, naphthenic acid prices closely follow the petrochemical supply & demand forces and crude oil price trends. Any volatility in international crude oil markets translates into fluctuations in naphthenic acid prices. Since past few years, crude oil markets remained unpredictable due to geopolitical issues, trade conflicts, and uncertainty around global economic growth. This creates an uncertainty over naphthenic acid prices. Moreover, availability and pricing of crude oil also determines the operating costs and profit margins for producers. Thus, fluctuating feedstock costs act as a major restraint challenging stable business planning for market players.
Growing Plastic Additives Demand Presents Lucrative Opportunities
Naphthenic acid finds increasing adoption as a dispersant and surfactant in plastic formulations. It is widely used as an important chemical additive in PVC processing to enhance the flexibility and durability of final products. The global plastic industry has been attracting huge investments and expanding at a rapid pace given its wide range of applications in automotive, packaging, construction, and electronics. This rising plastic demand provides significant opportunities to naphthenic acid producers for developing and supplying customized rubber and plastic additives. New application development as a dispersing agent for polymers and resin manufacturing is another potential growth area which producers are addressing through extensive research activities.
Opportunity to Penetrate Electroplating Industry
Electroplating is an electrochemical process of applying a thin layer of metal onto metal substrates for purposes like corrosion resistance and improved appearance. Naphthenic acid can act as an effective inhibiting agent in electroplating formulations for metals like zinc, copper, nickel, and tin. It controls the plating deposition and provides uniform finish. With growing industrialization and electronics manufacturing globally, the electroplating industry demand is expanding fast especially in Asia Pacific. Producers have the opportunity to target this application segment and develop niche product grades suitable for electroplating chemistries. Effective marketing strategies can help increase naphthenic acid consumption in the electroplating industry over the coming years.
Link: https://www.coherentmarketinsights.com/market-insight/naphthenic-acid-market-5407
Key Developments:
Industry Insights:
Naphthenic acid, a harmful substance present in oil sands process water (OSPW), presents major environmental issues because it is difficult to biodegrade. Addressing the removal of naphthenic acid from OSPW is vital for improving the environmental sustainability of oil sands operations. Shanghai Changfeng Chemical Industrial Factory, a prominent state-owned enterprise under Shanghai Coating Co., Ltd., and part of the Shanghai Huayi Group, is one of China’s leading and most established manufacturers of naphthenic acid, naphthenate, isocaprylate, and rare earth driers.
Key Players:
Merichem Company, Umicore Cobalt & Specialty Materials (CSM), Merck KGaA, Midas Chemical Company Limited, Shanghai Changfeng Chemical Industrial Factory, Shenyang Zhang Ming Chemical Co. Ltd, and Tokyo Chemical Industry Co., Ltd.
