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The Southeast Asia polyurethane market size was valued at USD 3.32 billion in 2021. The market is projected to grow from USD 3.46 billion in 2022 to USD 4.98 billion in 2029, exhibiting a CAGR of 5.3% during the forecast period. The global COVID-19 pandemic has been unprecedented and staggering, with polyurethane experiencing higher-than-anticipated demand across Southeast Asia compared to pre-pandemic levels. Based on our analysis, the Southeast Asia polyurethane market exhibited a growth of 4.6% in 2020 as compared to 2019.
Polyurethane (PU or PUR) is a plastic polymer that belongs to the class of block copolymers. It is prepared by combining diisocyanates (MDI and TDI) and polyols. PUR is ideal for providing water & oil resistance and lightweight characteristics and has the ability to withstand harsh environments. The increasing demand for furniture worldwide due to growing residential and commercial spaces fuels the consumption of flexible foam in beds and sofas. Moreover, rapidly growing green building projects to reduce environmental pollution will further increase the product adoption owing to its sustainability. Hence, such factors are anticipated to flourish the market growth during the forecast period.
Pandemic Had a Significant Impact on Consumption of PU Due to Movement Restriction
Since the outbreak of coronavirus in late 2019, many countries have imposed restrictions on material distribution and transportation, affecting the value chain of the product manufacturers. Many producers faced a supply shortage, at least for the first half of 2020, due to trade restrictions in key industrial nations such as Thailand and Indonesia. As a result of this issue, companies' manufacturing capacities were hampered and the demand for polyurethane products decreased. Moreover, PUR is widely used in the furniture and construction industries. These industries were severely impacted during the pandemic due to unavailability of labor, shortage of timber and foam, supply chain disruptions, and strict government regulations. This decreased the product consumption in these industries even further.
However, the rapid growth of the packaging industry during the pandemic has somewhat offset the market decline and helped to fuel the product demand for laminating adhesives. Also, various governments have eased rules to aid nations in getting their economies back on track. As a result, the Southeast Asia polyurethane market is anticipated to grow positively in the coming years.
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Rising Demand from Green Buildings Owing to their Sustainability to Drive Market Growth
PU consumption is predicted to rise throughout the forecast period due to the rising demand for building insulation in light of sustainability concerns. Sustainability in building development is a vast issue that must be employed early in construction due to the potential environmental impact. The adoption of green buildings in the construction industry is associated with rising investments in innovative, energy-efficient residential and commercial buildings. The green concept is ideal for profitable opportunities and is also acceptable to federal and environmental regulations. This is expected to boost the market growth during the forecast period.
The increasing product usage in building insulation materials is attributed to its growing effectiveness in the construction industry. Insulating materials in buildings regulate Air Conditioning, Ventilation, and Heating (HVAC) and respond to the energy lost due to ineffective insulation. Hence, increasing green building projects in Southeast Asian countries coupled with growing innovation in PU to make it more sustainable will create newer heights for the market.
Increasing Usage of Foams in the Furniture Industry to Surge Product Demand
The increasing preference for PU foam from bedding and cushioning applications in the furniture industry is driving the market growth. Durability, flexibility, and comfort offered by the foam surge its use in the furniture industry. Furthermore, furniture demand in Southeast Asia is associated with rising population and their changing lifestyle. This is anticipated to drive the Southeast Asia polyurethane market growth.
Moreover, the rising demand for sofas and chairs from commercial spaces, including offices is expected to surge the product demand from the construction industry. Wheels and casters made from PU for office chairs or other furniture have incredible load-bearing capabilities and abrasion & tearing resistance properties. As a result, they allow effortless movement of the furniture. Hence, increasing advancement in PU to make it more innovative and the rapid expansion of the residential & commercial sector in Malaysia, Thailand, and Indonesia are surging the product consumption.
Availability of Substitutes May Restrict Product Adoption
PU is a material of choice for various applications. However, the availability of several substitutes would replace the use of the product in many applications. For example, polysiloxane coating is preferred over PU coating in marine applications. The weathering properties and durability of polysiloxane coating make it a vital substitute for PU coating in marine applications. On the other hand, linseed oil is used instead of resins to treat wood in the furniture industry. Hence, the availability of these substitutes would restrict the polyurethane market growth in Southeast Asia.
Flexible Foam to Remain Leading Product Type Owing to Increasing Adoption from Furniture Application
Based on product type, the market is segmented into rigid foam, flexible foam, molded foam, elastomers, adhesives & sealants, coatings, and others. The flexible foam segment accounted for the largest market share in 2021. The consumption of flexible foam is gaining traction as cushioning in various commercial and consumer products such as furniture, bedding, carpet underlay, automotive interiors, and specialty packaging. The growth is attributed to its properties, including flexibility, lightweight, durability, comfort, and support. Additionally, rising millennials spending on furniture goods, along with their expanding brand awareness, is fueling the product consumption in furniture over the study period.
The increasing demand for rigid foam as an engineered material will fuel its consumption. The characteristics of rigid foam, such as outstanding performance, high mechanical properties, and thermal insulation, make it a preferred choice of material in various end-products such as refrigerators, buildings & constructions, and automobiles. On the other hand, molded foam finds its high consumption in wheelchairs, owing to its stabilization, optimal support, and pressure redistribution characteristics. The elastomers segment is anticipated to grow significantly due to increasing product adoption in various end-use markets, including shoes, run-flat tires, gaskets, truck bed liners, and tire fill products.
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Furniture Segment to Generate Highest Revenue Due to Expansion of Commercial and Residential Buildings
On the basis of application, the market is categorized into furniture, construction, electronics, automotive & transportation, packaging, footwear, and others. The furniture segment accounted for the largest Southeast Asia polyurethane market share in 2021. In this application, PU is majorly used as a foam for cushioning effect, offers excellent support, and increases durability. It is also used to protect furniture from scratches, help to resist water damage, and coat surfaces.
Moreover, in the construction industry, the increasing adoption of rigid foam in filling and sealing gaps, insulation, and installing doors and windows will surge the product demand. Additionally, adhesives & sealants are finding increasing use in residential construction. This is due to the fact that the material offers excellent adhesion to numerous substrates, including wood, concrete, glass, and plastic, owing to their structural and elasticity properties.
The pressure-sensitive encapsulated seal & insulate fragile printed circuit boards, underwater cables, and microelectronic components are the main product application areas in electronics. The rising electronics industry will create growth opportunities for the market during the forecast period. The increasing product demand in automotive & transportation, owing to its considerable benefits in terms of protection, comfort, and energy efficiency will augment the segment growth. The growing use of flexible PU in packaging due to its soft and lightweight nature will escalate the product demand in packaging.
The PU market in Thailand stood at USD 1.17 billion in 2021, and the market is estimated to remain the largest throughout the forecast period. According to Enterprise Singapore, automotive and electronic goods exports are the main drivers of Thailand's economic growth. This increases product consumption in the production of automotive and electronic goods. Additionally, the growing home furnishing industry is further increasing the adoption of flexible PU foams.
On the other hand, the increasing demand from the electronics and manufacturing industries is expected to contribute to the market revenue in Malaysia. Additionally, rapid industrialization in this country is fueling the expansion of factories, thereby driving the product consumption in industrial flooring.
Automotive is the leading and key manufacturing industry growing rapidly in Indonesia. The product consumption in this industry can be majorly seen as a material for bearings, jigs, bushes, hangers, shock dampers, flexible couplings, and bushing.
Moreover, increasing furniture manufacturing in Vietnam will surge the adoption of flexible PU. Ranked by CSIL, Vietnam is the largest furniture exporter in Southeast Asia and the 6th largest exporter worldwide. The country is the biggest supplier of wooden furniture to China, Poland, and Italy.
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The rest of the Southeast Asian countries include Laos, Myanmar (Burma), Brunei, Cambodia, Timor-Leste, Singapore, and the Philippines. Factors, such as growing construction and electronic industries in Singapore, rising technological advancement, and expansion of packaging and automotive industries in the Philippines and Myanmar, will promote product adoption in these countries.
Key Market Players to Use Product Innovation to Enhance Performance of their Offerings
The major players are present throughout the globe. One of the major companies, the Huntsman Corporation, is expanding worldwide by using strategies such as joint ventures, product innovation, and expansion. The company offers comprehensive solutions ranging from resins to adhesives. In 2020, Huntsman's chemical industry will touch more than 95% of all manufactured goods. Additionally, the company has a wide presence in Argentina, Australia, Belgium, Brazil, Canada, Chile, Colombia, and the Czech Republic. It has 66 production sites and operates in more than 70 manufacturing, research & development, and operations facilities in approximately 30 countries.
An Infographic Representation of Southeast Asia Polyurethane Market
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The report provides qualitative and quantitative insights and a detailed analysis of the market size & growth rate for all possible segments in the market. Along with this, the report provides an elaborative analysis of the market dynamics, trends, and competitive landscape. Various key insights presented in the report are recent industry developments, regulatory scenario in crucial countries, macro & microeconomic factors, SWOT analysis, and key industry trends.
Value (USD Billion), Volume (Million Ton)
By Product Type, Application, and Country
By Product Type
Fortune Business Insights says that the Southeast Asia market was valued at USD 3.32 billion in 2021 and is projected to reach USD 4.98 billion by 2029.
In 2021, the market value stood at USD 3.32 billion.
Growing at a CAGR of 5.3%, the market will exhibit rapid growth during the forecast period (2022-2029).
Flexible foam is expected to lead the market during the forecast period.
The rising demand for foams from the furniture industry is the key factor driving the market.
BASF SE, DOW Chemical Company, and Huntsman Corporation are the leading players in this market.
Thailand held the highest market share in the Southeast Asia market in 2021.
The key factors driving product adoption are the rising demand for recyclable PU and increasing end-user preference for flexible foam.
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