The global paraffin market is expected to record a CAGR of over 3% during the forecast period. The major factors driving the market studied are increasing demand from candles and packaging, growing personal care industry in the Asia-Pacific region.
-The development of bio-based products is expected to hinder the growth of the paraffin market in the forecast period.
-Increasing use of investment casting is likely to act as an opportunity over the forecast period.
Key Market Trends
Paperboard and Packaging to Drive the Market
- One of the major applications for paraffin in the global scenario is the paperboard and packaging segment. Asia-Pacific is the largest market for packaging in the world, followed by Europe.
- Paraffin waxes and paraffin-based wax blends are used in packaging to provide gloss, freshness seals, moisture, and grease barriers. Some of the benefits of using this are water and water vapor resistance, gas, and odor barrier (prevent loss of flavor or contamination), and improved process efficiency.
- A high proportion of all industrial products are sold in packaging, either due to stability requirements for storage and transport, or for aesthetic reasons.
- The improvement in living standards and higher purchasing incomes, especially in eastern European and North American countries, have increased the demand for a broad range of products, all of which require packaging. Therefore, the demand for packaging is increasing, resulting in the increased consumption of paraffin.
- Another factor contributing to the potential demand for paraffin within packaging is the traditionally low levels of automation, which causes many packaging producers to use paraffin wax blends.
- Most of the demand from the packaging segment is from the food and beverage industry. On the other hand, healthcare products are the largest users of folding cartons. The aforementioned end-user segments are likely to boost the demand for paraffin, during the forecast period.
Asia-Pacific to Dominate the Market
- Asia-Pacific region dominated the global paraffin market. With the growing population and increasing per capita income, the number of houses is increasing in countries such as China and India, resulting in the increased average number of candles used by the individuals. With an increasing focus toward personal appearance, aging population, and quality of living, the use of cosmetic and personal care products is increasing in the region. The market for cosmetics in India has increased significantly since the past decade.
- With an increasing focus toward personal appearance, aging population, and quality of living, the use of cosmetic and personal care products is increasing in the country.
- India is expected to strengthen its position among the leading consumers of paraffin, globally, during the forecast period.
- The economy of India is the sixth-largest in the world, measured by nominal GDP, and the third-largest by Purchasing Power Parity (PPP). The country is classified as a newly industrialized country, and one of the G-20 major economies.
- With a growing population and increasing per capita income, the number of houses is increasing in the country, resulting in the increased average number of candles used by the individuals.
- The packaging industry in the country is rising at a significant rate, owing to the expanding food, beverage, and retail industries. According to the Indian Institute of Packaging (IP), the Indian packaging sector is expected to be valued at USD 32 billion by 2020, exhibiting double-digit growth of nearly 13% every year.
- All the aforementioned factors, in turn, are expected to boost the market for paraffin, during the forecast period.
The global paraffin market is fragmented in nature. The major companies include Sasol, Exxon Mobil, Corporation., LANXESS, and JXTG Nippon Oil & Energy Corporation, and China Petroleum & Chemical Corporation (Sinopec Corp) among others.
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