Japan Formic Acid Market Size, Share & COVID-19 Impact Analysis, By Grade (85%, 94%, 99%, and Others), By Application (Agriculture, Leather & Textile, Chemical, Rubber, Pharmaceuticals, and Others), and Country Forecast, 2023-2030

The Japan formic acid market size was valued at USD 7.28 million in 2022 and is projected to grow from USD 7.51 million in 2023 to USD 9.59 million by 2030, exhibiting a CAGR of 3.6% during the 2023-2030 period.

Formic acid is part of the functional group of carboxylic acid that is colorless and soluble in water. It offers antibacterial and preservative chemical properties to the animal feedstock and is utilized in leather tanning. The properties exhibited by the product are anticipated to boost market growth. The product demand in Japan is gradually increasing owing to its use in end-use applications such as agriculture, leather & textile, chemical, rubber, pharmaceuticals, and others.

COVID-19 IMPACT

Shortage of Workforce Due to the Pandemic Negatively Impacted the Market

By the end of 2019, COVID-19 had impacted the world, including the global economy and business. During the period, product manufacturers in Japan faced a shortage of workforce and essential raw materials owing to trade restrictions to ensure public safety. This placed a limit on business operations, including manufacturing activities, sales and marketing, leading to a decrease in product demand. As a result, the pandemic led to a decrease in the market share in the chemical industry.

LATEST TRENDS

Increasing Utilization in Fuel Cell Technology to Create Opportunity for Market Growth

Formic acid is widely used for animal feed preservation owing to its acidifying nature and antimicrobial properties. It may help to reduce the campylobacter, escherichia coli, and salmonella bacterial growth in the animals, resulting in better animal health.

Despite the common utilization, the product demand from fuel cell technology is gradually increasing. Formic acid can be harnessed to power an engine when it is used in the fuel cell during the reaction between water and CO2. For instance, a group of Dutch students developed a fuel-cell-based bus that can be operated on formic acid and is a cheaper fuel alternative solution than hydrogen fuel. Such utilization of the chemical has created a massive opportunity for manufacturers to establish their presence in power applications.

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DRIVING FACTORS

Increasing Dependency on Domestic Agricultural Activities to Drive Market Growth

The market is anticipated to grow during the forecast period owing to the rising domestic agriculture industry. According to the International Trade Administration (U.S. Department of Commerce), the U.S. generated a value of USD 15.6 billion by exporting agricultural products to Japan with a 24% import share. Moreover, the country is the largest market for the consumer-ready products offered by the U.S. Therefore, to reduce the dependence of agricultural products on foreign countries, the government of Japan launched the ‘MAFF’ subsidy scheme for agriculture firms that would offer an agricultural workforce. The scheme would also provide a financial grant for starting their agricultural management business.

Such factors have influenced product consumption in the agricultural industry owing to its usage as a preservative for animal feed. In addition, Japan has a small geographical area, including volcanoes and mountains. Hence, the farmers in the country are not able to grow enough animal feed. As a result, animal feed preservation has become a priority for the agricultural industry, increasing Japan’s market share globally.

RESTRAINING FACTORS

Strict Regulations and High Toxic Levels May Hamper Market Growth

The toxicity levels of the high-grade formic acid may hamper human health when its exposure crosses the desired limits. This high-risk hazardous chemical can cause nose and throat irritation, shortness of breath, nausea, and vomiting. Therefore, a global chemical organization such as the OSHA, NIOSHA, and IDLH have set their exposure limits ranging from 5 ppm to 10 ppm.

Moreover, the acid is highly reactive and violently reacts with oxidizing agents, including peroxides, permanganates, and perchlorates. Further, this acid reacts with the chemically active metals and strong acids. Such reactivity requires a high level of handling and storage, which further increases the product cost and, as a result, impacts its consumption in the end-products.

SEGMENTATION

By Grade Analysis

85% Grade Accounted for Dominant Market Share due to its Adoption in Agriculture Industry

Based on grade, the market is segmented into 85%, 94%, 99%, and others.

The 85% grade segment dominated the market in Japan in 2022. The growth is attributed to the increasing grade consumption across the agriculture industry. This is due to its ability to be used as an antibacterial and preservative agent in livestock feed.

The 94% and 99% segments are anticipated to grow at a significant CAGR during the forecast period. The growth of the 94% and 99% segments is owed to their consumption in the end-use industries. For instance, 94% grade is utilized in the leather industry for the tanning process due to its eco-friendly nature. Its applications are also rapidly increasing in the manufacturing of pharmaceuticals, cosmetics, disinfectants, and detergents. The growing product demand from the end-use industries is anticipated to boost the market in Japan.

By Application Analysis

Agriculture Segment Leads with Rising Product Consumption in Pesticides Manufacturing

Based on application, the market is segmented into agriculture, leather & textile, chemical, rubber, pharmaceuticals, and others.

The agriculture segment holds the largest Japan formic acid market share. The consumption of the product in the agricultural segment is mainly rising in the synthesis of chemicals and manufacturing of pesticides. It is also adopted as a preservative to prevent further spoilage of livestock winter food and antibacterial in animal feed.

The growing demand for leather from several leading industries such as construction, aerospace, automotive, sports, and consumer goods, is promoting product adoption in the leather segment.

The rising technological innovations and a growing aging population are further promoting the product demand for the synthesis of insulin in the pharmaceutical industry.

Furthermore, formic acid acts as an intermediate for chemical production. The product is also used as a coagulating agent in the production process of rubber. The rapid increase in the chemical and rubber industries is surging the product demand.

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KEY INDUSTRY PLAYERS

Key Players to Gain Market Competence Based on Product Innovations

In terms of the competitive landscape, the market depicts the presence of established companies. The key industry players include KOEI CHEM, Tokyo Chemical Industry Co., Ltd., MITSUBISHI GAS CHEMICAL COMPANY, INC., Nacalai Chemicals, Ltd., and FUJIFILM Wako Pure Chemical Corporation. Industry players compete primarily based on the application characteristics of the product. Companies are emphasizing product innovation and collaboration to gain competence and bolster the Japan formic acid market growth.

LIST OF KEY COMPANIES PROFILED:

• BASF SE (Germany)
• KOEI CHEMICAL CO., LTD. (Japan)
• Eastman Chemical Company (U.S.)
• Perstorp (Sweden)
• Mudanjiang Fengda Chemical Co., Ltd. (China)
• Tokyo Chemical Industry Co., Ltd. (Japan)
• MITSUBISHI GAS CHEMICAL COMPANY, INC. (Japan)
• Nacalai Chemicals, Ltd. (Japan)
• FUJIFILM Wako Pure Chemical Corporation (Japan)
• Chongqing Chuandong Chemical (Group) Co., Ltd. (China)

REPORT COVERAGE

An Infographic Representation of Japan Formic Acid Market

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Based on market analysis, the study report thoroughly examines key factors such as leading companies, applications, and products. It also provides market trends and highlights the significant industry advancements. The study includes different variables that have contributed to the market growth in recent years and the factors listed above. It examines the industry's latest dynamics, historical data, and revenue growth at the country level.

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Report Scope & Segmentation