The chemicals industry is amid an unprecedented transformation, revealing major growth opportunities centered around alternative feedstocks and product innovation. Three megatrends are driving this shift:
- Sustainability Initiatives: Today’s customer preferences and regulatory frameworks facilitate minimizing carbon emissions across the value chain and transitioning away from fossil fuel feedstocks.
- Technological Disruption: Advancements like artificial intelligence (AI) are spurring new product development, leading to improved chemical and material solutions.
- Geopolitical Challenges: Rising geopolitical tensions are causing supply chain difficulties. This has accelerated the focus on localization, enabled by digital and automation technologies.
Click here to access our latest analysis revealing lucrative growth opportunities emerging in the chemicals industry.
Are you accounting for these transformative megatrends while building your growth strategy to improve your chances for success?
WHAT ARE THE KEY OPPORTUNITIES FUELLING GROWTH?
Cross-Industry Collaboration and Diversification
In this dynamic ecosystem, chemical manufacturers are adapting their business models to focus on cross-industry partnerships. This approach is helping harness the benefits of emerging megatrends like electrification, digitalization, automation, and sustainability. For instance, communication technology partners are digitalizing several chemical industry segments, while recycling companies play a crucial role in helping manufacturers achieve a circular economy.
The growth opportunities arising from these dynamics involve embracing diversification. For example, informed customers are opting for products that leverage eco-design principles or utilize bio-based materials. Additionally, investments in technological infrastructure such as 5G-enabled systems, tools, Edge computing, and quantum computing are empowering large companies to enhance their processes and pioneer new chemical and material solutions.
Is your team harnessing strategic alliances and diversification for your competitive growth?
Companies to Action
- Sinopec, the world’s largest oil refining, gas, and petrochemical conglomerate, has invested in state-of-the-art private 5G infrastructure at its subsidiary’s (Sinopec Guangzhou Company) facility in China.
- 3M has collaborated with HowToRobot, a company focused on enabling robotics solutions, to develop automated tape and adhesive solutions, thus harnessing the automation megatrend.
Source: Frost & Sullivan’s Top 10 Growth Opportunities in Chemicals, 2024
To learn more about diversification and eight other emerging growth opportunities for chemical manufacturers, click here to view our latest growth analysis.
Adopting Alternative Fuels
Alternative fuels represent a promising path towards decarbonization – green hydrogen, for instance, is considered viable for powering a wide range of vehicles, including medium- and heavy-duty automobiles that electric powertrains may not adequately support. There are also opportunities in developing alternative fuels for the marine industry; green ammonia is a key focus area for sustainable marine fuel. Similarly, in the aviation industry, there is growing demand for biofuels. With this, biorefineries are being set up, especially for converting vegetable oils, used cooking oil, and waste residue into aviation fuel.
Company to Action
The Finnish oil refining company, Neste Oyj, has pioneered the ‘NEXBTL’ technology to produce renewable diesel from renewable raw materials. In 2023, Neste expanded its biorefinery capacity in Singapore to produce 2.6 million tons of biofuel annually, with around 40% dedicated to sustainable aviation fuel.
Source: Frost & Sullivan’s Top 10 Growth Opportunities in Chemicals, 2024
To learn more about alternative fuels and eight other emerging growth opportunities for chemical manufacturers, click here to check out our growth analysis.
Is your organization well positioned to capitalize on the latest growth opportunities in this domain?
About Frost & Sullivan:
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