SCUP Report

Table of Contents

Abstract

The rubber-processing industry, the plastics industry, the fuel and lubricant industry, and the food and feed industry are major consumers of antioxidants. Antioxidants are part of a company's broader portfolio of additive products designed to serve specific end-use industries. Therefore, antioxidants do not really represent an industry but should be characterized as one component of the larger chemical additives industry.

The principal chemical classes of antioxidants are amines, hindered phenols, phosphites, thioesters and various natural or "natural-based" compounds. These chemicals are used primarily to inhibit the oxidative degradation of unsaturated organic materials such as elastomers, plastics, petroleum-based fuels, and food or animal feed.

Antioxidant producers have been facing a significant shift of their customer base to the Asia Pacific region, particularly to China. At the same time, market competition from China and India is growing rapidly. To serve the growing global customer base, major antioxidant producers have been forming partnerships with local companies to expand local production bases. At present, the Asia Pacific region accounts for over 50% of the global production of antioxidants.

At the time of this report's publication, the world's economies are experiencing a downturn in their economic growth. While not all countries are undergoing a recession, those that are not are witnessing a decline from past economic growth rates. Although no one is willing to predict when the world's economies will return to historical growth patterns, for the purposes of this report, we have assumed that the current downturn will last into the first half of 2010. We have also assumed that the recovery will be relatively slow and that individual economies will not return to their historical growth patterns until the 2012–2013 time period. Additional factors in this report's forecasts include the migration of manufacturing, such as automotive tires, from developed to developing economies, and the uncertainty in energy prices. Each country's economic conditions are reflected in the consumption forecasts for that country. These forecasts reflect our chosen cautious approach.

The following pie chart shows consumption of antioxidants by major region:

In 2008, rubber (and latex) applications accounted for 54% of total antioxidant consumption in the major regions, followed by plastics (34%), food and feed (8%) and petroleum fuels (4%) on a volume basis. Substantial differences in end-use distribution are apparent in these major regions.

The five-year consumption growth rate through 2013 is projected to be between 1% and 3% per year. At 7–9% per year, India is expected to grow the fastest, followed by China (4–6% per year). The remaining countries/regions are expected to show little if any growth over the period.