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chemical industry

Surviving in China’s Chemical Industry: A Guide for International Chemical Companies

Chemical industryAlthough China’s chemical industry growth has receded, the region continues to remain the most profitable for most global chemical companies. The colossal size of the chemical industry in China should not be blindly associated with the sector’s stability. The industry is in the midst of a profound rapid transformation due to stringent investment pools, stricter environmental laws by the government, and changing consumer-demand trends. Furthermore, increasing economic turbulence in the region since mid-2018, related to China’s economic slowdown and the turbulent US–China trade relations, adds new uncertainties in the chemical market dynamics.

China’s economy is currently moving to a new era of development. After the headlong market expansion in the early 2000s, the chemical market is now focused on consolidated and selective growth. As overcapacity in one of the existing challenges faced, companies looking to make fresh investments in the chemical industry are faced with a more selective appraisal from the Chinese authorities.  Moreover, intensifying competition from the local Chinese chemical market companies who are at advantage due to their lower production costs compared with imports and their greater ease in establishing relationships with key customers poses greater challenges for international chemical companies in China. As critical changes are underway in the chemical market in China, players will have to adopt a new set of strategies to survive and ensure continued growth.

Industrial policies and changing demands in China’s chemical industry is stirring new trends and growth opportunities for players. Request a free proposal for more insights on how your business can capitalize on them.

Attaining profitable growth in China’s chemical market

Chemical industryPrioritize products matching domestic requirements

China’s growth prospects in the future of chemical industry cannot be denied, but the changing chemical market dynamics make market opportunities more nuanced for international companies. This means that international chemical companies need to learn to adapt. One approach to achieve this is to focus on products that match the domestic needs and that the Chinese state is promoting. Chemicals are crucial enablers for strategic growth in industries that China prioritized to gain a major market at a global scale. This includes sectors such as electric vehicles, new energy technologies, and civil aviation among others. International chemical companies must aim to become China’s trusted partners in their innovation plans to bridge technological gaps and set environmental standards in sectors that have a major government backing.

Proactive stakeholder management

International companies that seek to establish their business in China’s chemical industry will need extensive approvals and support from several stakeholders both across the regulatory as well as the business landscape. Ergo, effective stakeholder management becomes vitals especially in the case of building new plants and new product introductions, especially in the regulated products category.  As China currently does not have a process to legitimize the proposed chemical industry investments in a community, the concerns of environmentalists and local communities can only be addressed through hands-on stakeholder management. International companies operating in China’s chemical industry have already set up dedicated teams to identify and manage all the key stakeholders affecting their business.

Our market research capabilities have helped several global players analyze new markets and identify critical growth opportunities before other players in the market with tailored and proactive solutions. Seeking similar engagements for your business? Get in touch our industry experts to know more about our solutions.

Re-engineering the existing go-to-market strategies

China’s business landscape is highly relationship driven. So, having a local presence in the country becomes important to capture value from new market opportunities. Companies must seek to establish a tailored distribution approach. Appropriate distribution partner network enables international players in the chemical industry to get closer to customers and also differentiate their products in the increasingly competitive chemical market in China.

Building strategic M&A partnerships

M&A partnerships are the strategic approach to grow more quickly and extensively in the chemical industry in China. This will enable chemical companies to gain organic growth through increased market access and also fill product or technology gaps. Several dynamic mid-sized chemical companies have emerged in China over the recent years. This could present attractive acquisition opportunities for international chemical companies. A dedicated business development team in China can help international players in the chemical industry better meet these motives.

For more insights on our services for chemical industry companies

Agrochemical industry

Nurturing the Growth Momentum in the Agrochemical Industry

Although agrochemical companies witnessed declining revenues in the past, the industry has bounced back over the past couple of years by consolidating their market share through strategic M&A, increasing their R&D spend, and including digital as a major component to boost their products. The rising market demand for crop protecting chemicals to prevent crop losses and increase the yield will greatly fuel the growth of the agrochemical industry. However, some key challenges including escalating material costs, longer product development cycles, farm subsidy reduction, and rising regulatory requirements continue to persist. To overcome these challenges, top agrochemical companies have begun performing some strategic maneuvers. Experts at Infiniti Research highlights these strategies and other critical approaches for companies in the agrochemical industry.

The future of agrochemical industry looks bright, but is your business ready to capitalize on the market opportunities? Our team of experts can help you analyze market trends well in advance and leverage the right opportunities to suit your business needs. Request a free proposal for insights.

M&A for strategic advantage

M&A has helped some of the biggest names in the agrochemical industry gain major portfolio optimization. Apart from this, a major benefit of M&A is that it allows companies in the agrochemical industry to increase the acquirer companies’ geographical presence. This is especially true for geographical regions where the company previously didn’t have a good distributor network.

Innovation and R&D

Product registrations today go through an extensive registration and screening process. While M&A can be a great platform for companies to expanding their existing product lines and enhancing their global reach, creating and scaling external partnerships for innovation and R&D to develop and commercialize new products in the agrochemicals market.

Currently, although growth in the agrochemical industry may seem a little daunting for established players on the surface, many changes underway are likely to transform the sector completely. Get in touch with an industry expert for more insights on the agrochemical industry.

Digital technologies to bolster product offerings

Today, companies in the agrochemical industry have transformed from being mere providers of farm inputs to complex providers of integrated products by using ‘digital’ as a major component. Acquiring or getting into partnerships with companies in the agrochemical industry with superior technology backup can help increase access to advanced technologies and incorporate them into business. Digital technologies can help companies in the agrochemical industry to launch digital platforms for data collection, visualization, modeling, and weed out major inefficiencies in operations.

Experts at Infiniti Research believe that creating differentiation through innovation, expanding geographical reach through M&A efforts, and capturing additional value by deepening farmer engagement will also likely be the key strategic themes going forward in the agrochemical industry. But the question remains around how companies in the agrochemical industry can tackle future disruptions and roadblocks that can potentially impact the current revenue streams and what changes in strategic positioning this might entail.

Want more insights on strategic growth in the agrochemical industry?

German chemical industry

Gaining Profitable Growth in China’s Chemical Market: Imperatives for International Chemical Companies

China’s chemical industry overview

Although the economic expansion in China has slowed down over the past few years, it still remains a key growth market for most global chemical companies. Industry experts believe that over the next decade, China will continue to be one of the major importers of commodity chemicals. Furthermore, international chemical companies have advanced and more sophisticated products that can support the further stages of China’s economic development. However, international companies in China’s chemical sector have new challenges coming their way. Companies in China are increasingly moving out of low-profit commodity segments towards more sophisticated sectors. They are also enjoying several home-player advantages in the highly competitive market. In this article, chemical industry experts at Infiniti Research provide an outline of the moves that international chemical companies must make in order to continue capturing profitable growth opportunities in China’s chemical market. International chemical companies that want to create a place for themselves in China’s chemical market must align their products and business models with China’s evolving needs, learn how to access the shifting demand, and strategize to expand and strengthen their base in this market.

Irrespective of the industry, entering a new market is highly challenging with several unforeseen risks that could prevent the company from sustaining in that market. Request a free proposal to know how you can partner with us to leverage our market entry solutions and bolster your business growth in a foreign market.

Chemical companies

 Adapt to the market’s changing needs

There will be a continued demand growth for chemicals in China. But the areas of opportunity in the country’s chemical market appear to be increasingly nuanced, due to which chemical companies must take measures to adapt and align their strategies accordingly. One approach to achieve this is by focusing on the company’s products that match up with China’s chemical industry needs and what the Chinese state is promoting. The chemical industry is a catalyst to promote growth in various strategic industries such as electric vehicles, new energy technologies, and civil aviation that the Chinese government wants to nurture growth globally. As such, this opens new windows of opportunity for international chemical companies to become China’s trusted partners in native innovations in industries that have government backing. International chemical companies can also work closely with government bodies in China to form product specifications based on the changing standards or rules in the region. This could prove to be a new growth driver for chemical companies.

Want to know more about the future of chemical manufacturing and the key factors that could alter the way chemical companies do business in the future? Request for more information from a chemical industry expert.

Manage stakeholders proactively

Chemical companies that want to sustain and grow their business in China’s chemical market must work and maintain positive relations with several stakeholders. This includes stakeholders across the country’s business and regulatory landscape. New plant launches and product approvals especially in regulated product categories require comprehensive rounds of approval from government authorities as well as state-run research institutions. Therefore, it is vital for international chemical companies to ensure proactive stakeholder management. Successful chemical companies are even going to the extent of hiring government-affairs teams to identify the key stakeholders in all areas that are related to their business operations in China. These teams understand stakeholder concerns and work on ways to address them in time so that hinderances to the company’s project can be avoided.

Choosing the right distribution partners

Businesses in China are generally heavily relationship-driven. As a result, it is vital for international chemical companies to have a local presence especially in new markets and business verticals. To gain a better foothold in China, chemical companies must focus on building a distribution partner network through which they can get to customers with ease and provide unique offerings in the highly competitive marketplace. Having the right distribution partners are critical as relationships, dependability and ethics vary sharply among different players in the market.

Get in touch with an expert to learn more about our solutions for chemical companies.

Chemical market intelligence

Enhancing ROI by 31% for a Chemical Company with Infiniti’s Chemical Market Intelligence Engagement

Chemical Market Outlook

As the chemical industry contributes to every manufactured product in one way or the other, the industry is poised to witness positive growth. Despite the positive outlook, the companies in the chemical industry still encounter several severe challenges. Some of them include the volatility of raw material cost, the increasing number of recalls and quality audits, and the competition from new market entrants. In order to succeed, chemical companies will need to address these challenges and harness untapped market potential. This is where companies realize the importance of leveraging chemical market intelligence solution.

With increasing competitive pressure from new market players, companies in the chemical industry are facing huge challenges to stay relevant in the market. Request a FREE proposal to know how our market intelligence solution can help companies in the chemical industry to understand the industry’s fluctuating dynamics and stay ahead of their competitors.

Business Challenge

The client is a chemical company based out of San Francisco. The client wanted to understand the prevailing market dynamics in the European chemical sector to devise an informed expansion strategy. Also, the client wanted to gain detailed market insights, identify the best route-to-market, and analyze the competitive landscape. To do so, the client approached the experts at Infiniti Research to leverage their expertise in offering chemical market intelligence solution.

With Infiniti’s chemical market intelligence solution, the client also wanted to:

Adapt to unexpected market changes

The increasing volatility in raw material cost, exchange rates, and tariffs created a dynamic environment in the European chemical market. With the aid of Infiniti’s chemical market intelligence engagement, the client wanted to understand the demand and sales potential for their chemical products in the Europe. Also, they wanted to stay abreast with all market changes and adapt to all the unexpected transformations.

Incorporate new technological innovations

The client noted that various technologies such as IoT and Industry 4.0 are highly transforming the operations and processes of chemical companies in Europe. With Infiniti’s chemical market intelligence, they needed to identify technological innovations and trends in the European chemical market. In addition, with Infiniti’s chemical market intelligence, they also wanted to streamline their operations to reduce overhead expenses.

Our chemical market intelligence solutions can help chemical companies to track emerging market trends and regional market developments to quickly adapt to the evolving market requirements. CONTACT US today to leverage our market intelligence solution.

Solutions Offered

As a part of the chemical market intelligence engagement, the experts at Infiniti Research conducted a market opportunity assessment. This phase of the chemical market intelligence engagement helped the client to evaluate the prevailing market dynamics of the European chemical industry, European chemical market size, and chemical market growth rate. Also, the client was able to evaluate the potential demand for chemical products in the Europe.

The chemical market segmentation approach conducted as a part of the chemical market intelligence engagement helped the client to segment their target customer groups and devise personalized strategies to attract them.

Also, the trend analysis engagement conducted as a part of the chemical market intelligence engagement helped the client to identify chemical market trends and latest innovations. In addition, with Infiniti’s chemical market intelligence engagement, the client was able to understand exchange rates and tariffs and efficiently forecast the average sales potential.

Results Obtained

Infiniti’s chemical market intelligence engagement supported the client in devising an informed expansion plan. Infiniti’s chemical market intelligence solution helped the company to withstand unexpected fluctuation in the market, enhance inventory planning, and increase reliability across operations. Also, by streamlining their business processes, the client was able to enhance their ROI by 31%.

Request for more info to know how our market intelligence solutions can help companies across other sectors.

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