What Is The Acetic Acid Market Spread In India?

Acetic acid, a colourless and acidic liquid with various names such as ethanoic acid, vinegar acid, and methane carboxy acid, is a versatile organic compound. Its chemical formula, CH3COOH, makes it a second simple carboxylic acid, the simplest being the formic acid. Acetic acid has numerous applications in various industries and households. Cellulose acetate is utilized in the manufacturing process of photographic film, polyvinyl acetate for wood glue, and a variety of synthetic fibers and fabrics. Additionally, diluted versions of acetic acid serve as descaling agents in households and as acidity regulators and condiments in the food industry.

Market Size

The acetic acid market in India has experienced significant growth in recent years, with a market size reaching 1.2 million tons in 2022. Acetic acid demand is set to skyrocket, with a compound annual growth rate of 5.4% from 2023 to 2028, projecting it to hit 1.7 million tons by 2028. This growth can be attributed to the increasing acetic acid uses in various industries such as food and beverage, packaging, pharmaceuticals, and textiles.

The acetic acid market in India is regionally split into the West side, South side, North, and East sides, with West India exhibiting the highest consumption nationwide. States such as Gujarat and Maharashtra are the most significant contributors to the region’s acetic acid intake. The market in the western region is responsible alone for 50% of the total use of acetic acid in India. It is anticipated to grow further primarily due to the presence of factories in the region that heavily requires acetic acid for applications in paints and coatings, pharma, food and beverages, chemical manufacturing, and polymers and packaging. In the South India region, Tamil Nadu is a major state consuming acetic acid.

Market Segmentation As Per End-Use Segments

In India, the acetic acid market is segmented into:

·       Ethyl Acetate- Among all the segments, ethyl acetate takes the lead, occupying a market share of around 35% in FY2022. This segment is widely used in making coatings, adhesives, and solvents.

·       Purified Terephthalic Acid- The purified terephthalic acid (PTA) segment is also witnessing significant growth due to the increasing demand for polyester resins in various industries. PTA is widely used in the manufacturing of PET bottles, films, and fibers.

·   Acetic Anhydride- The acetic anhydride segment is also expected to witness substantial growth owing to its extensive use in the manufacturing of cellulose acetate, which is further used in cigarette filters, photographic film, and textiles.

·   Monochloro Acetic Acid- The monochloro acetic acid segment is expected to witness moderate growth due to its limited application in herbicides, carboxymethylcellulose, and surfactants.

Which Is The Major Producer Of Acetic Acid In India?

Gujarat Narmada Valley Fertilizers & Chemicals Limited stands as the sole producer of acetic acid in India, with the remaining demand being met through imports. To meet the rising demand for food-grade acetic acid, Jubilant Ingrevia Ltd., a leading integrated pharma and life sciences company, constructed a new eco-friendly acetic acid factory in the first quarter of FY2023. This cutting-edge facility is designed to produce up to 25 thousand tons each year and is committed to achieving the highest standards of certification, including FSSAI, ISO-22000, Kosher and FCC Codex.

OFB’s Insight

The Asia Pacific region, including India, dominates the global acetic acid market, accounting for 48.8% of the revenue share in 2021. The booming demand for acetic acid across various sectors, including construction, pharmaceuticals, automotive, and textiles, is powering this growth in the market. Thus, by producing acetic acid locally and ensuring compliance with high product standards, the new plant will help reduce India’s dependence on imports and cater to the already available wide market in the Asia Pacific. It will also help strengthen the country’s chemical and manufacturing industries. To further boost domestic production and meet the increasing demand for acetic acid, there is a need to encourage more domestic manufacturers to enter the market.

Read more: Here’s Phenol Indian Outlook For April 2023

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