Europe Flame Retardant Chemicals Market - Segmented by Type, by End-user Industry, and Geography - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Europe Flame Retardant Chemicals Market - Segmented by Type, by End-user Industry, and Geography - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The market for European flame retardant chemicals is expected to grow at a CAGR of around 4% during the forecast period. The rising consumer electrical and electronic goods manufacturing, rise in safety standards in building construction, and rise in the standard of living in the eastern European countries​​ are likely to drive the demand for personal care chemicals.

Key Highlights

• On the flipside, environmental and health concerns regarding brominated and halogenated flame retardants​ and the impact of the COVID-19 outbreak are expected to hinder the growth of the market.
• Germany dominated the market across the region due to the rising demand from construction and electrical & electronics industries.

Key Market TrendsBuildings and Construction Segment to Dominate the Market Growth

• In the European building and construction industry, flame retardants are majorly used in structural insulation. Insulations are used in homes and other buildings to maintain a comfortable temperature and to conserve energy.
• Flame retardants also find major applications in polyolefin foams that are used in buildings in HVAC applications, such as sound insulation, thermal insulation for pipes, and others.
• Flame retardants used for rigid PU foams are available in three forms, such as additive liquid flame retardants, reactive liquid flame retardants, and solid flame retardants.
• In Europe, all materials for building and construction (including rigid PU foams) must meet the fire requirements, according to EN 13501. This regulation is driving the demand for flame retardants in the European building and construction industry.
• According to the European Construction Industry Federation, the total investments in the construction industry of EU-27 countries have been increasing significantly and thereby driving the demand for flame retardants.
• During 2018-19, the building and construction industry of EU-27 has witnessed a 2.6% rise in investments. However, this growth rate compared to the 3.8% rise witnessed during 2017-18.
• The declined momentum for residential construction in Germany, Spain, and France is considered to be the major factor behind this reduced growth rate of investments.
• In the United Kingdom, the construction industry witnessed significant growth over the past few years.
• The construction output in the United Kingdom has increased from EUR 150,484 million in 2016 to EUR 176,395 million in 2019, according to the Office for National Statistics (United Kingdom).
• This growing construction activities in the country are driving the demand for flame retardants in the country.
• Between FEB-Apr 2020, the EU-27 construction activity has decreased by around 25.7%, majorly owing to the lockdown caused by COVID-19, according to Eurostat.
• In Apr 2020, the construction output in the United Kingdom has witnessed a drop of 41.2% over May 2020. Though the construction has witnessed positive growth since APR 2020, the output is still lower compared to the pre-COVID-19 period.
• Hence, the COVID-19 pandemic has become a major restraining factor for the consumption of flame retardants in the European construction industry.
• The aforementioned factors are likely to affect the demand for flame retardants in the European construction industry during the forecast period.

Germany to Dominate the Market

• The German economy is the largest in Europe and the fifth-largest in the world. In 2019, the German economy grew by about 0.6%, which was its weakest growth rate in the last six years. Stronger private consumption, higher state spending, and booming construction helped support growth in 2019 as struggling manufacturers dragged on activity.
• The country is in plans to stop the further downfall of the economy due to the COVID-19 impact by announcing availability funds (of over USD 600 billion) to ensure growth and smooth functioning in various public sectors in near future. According to the recent IMF forecasts, due to the outbreak of the COVID-19, the GDP growth of the country is expected to fall to -7% in 2020 and pick up to 5.2% in 2021, subject to the post-pandemic global economic recovery.
• Germany leads the European automotive market, with 41 assembly and engine production plants that contribute to one-third of the total automobile production in Europe. Germany, which is one of the leading manufacturing bases of the automotive industry, is home to manufacturers from different segments, such as equipment manufacturers, material and component suppliers, engine producers, and whole system integrators.
• The automotive production of Germany in 2019 witnessed a decline of -9% compared to that of 2018 that is the production in 2019 was 4,661,328 units, and in 2020, the car manufacturing industry is emerging from a scathing period of lockdown, production halts, and a slump in sales.
• Hence, this is mainly due to lower demand, high costs, and shifting of the production base to other countries, like China. Hence, this decline in automotive production can restraint the consumption of flame retardant chemicals from the domestic automotive industry.
• Germany has the largest construction industry in Europe. The construction industry in the country has been growing at a slow pace, which is majorly driven by the increasing new residential construction activities.
• According to the industry experts, the number of completely constructed new houses is estimated to around 315,000 in 2019, which is higher, as compared to the total number of completed constructions in 2018, which was 300,000. This positive momentum has taken a huge blow from the devastating pandemic situation in 2020.
• According to the German construction industry association (HDB), the domestic construction industry is expected to fall by 3% in terms of revenue, in 2020. However, this situation is expected to be neutralized over the forecast period.
• German electronic industry is the largest in Europe, and the fifth-largest worldwide. The electrical and electronics industry accounted for more than 10% of the total German industrial production and about 3% of the country’s gross domestic product (GDP). The industry’s portfolio include industrial goods such as energy technology, medical engineering, automation (80%), intermediate products such as semiconductors (12%) and consumer goods such as household appliances, consumer electronics, lighting (8%).
• Moreover, the electrical and electronics industry accounts for around 23% of the entire FDI of the country. The investment in electrical and electronics industry in 2019 decreased due to weak demand and reduced exports to the United Kingdom. However, the R&D and innovation expenditure increased by 5% and 3.2% respectively. This demand is expected to recover gradually in the coming years post COVID-19, which is likely to contribute to the demand for flame retardant chemicals market from the industries.
• Germany is the largest market for furniture in Europe. The high consumer purchasing power creates an opportunity for manufacturers to innovate. Some of the key players in the German furniture industry include Huls AG & Co. KG, Topstar GmbH, and Rauch GmbH & Co. KG. Currently, there are over 22,000 furniture manufacturers across the country.
• The German textile industry has an annual turnover of around EUR 30 billion in 2019. The textiles and clothing industry is the second-largest consumer goods industry in Germany. The growing demand for technical textiles is expected to drive the market studied, substantially, in this region.
• Hence, such industrial trends are projected to drive the consumption of flame retardant chemicals in the country during the forecast period.

Competitive Landscape

The flame retardants market in Europe is consolidated, where the top five companies account for a notable share of the market demand. The major players in the market include ICL Group, LANXESS, BASF SE, J.M. Huber Corporation, and Nabaltec AG, among others.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

Companies Mentioned

IBM Corporation
Oracle Corporation
Internap Corporation
Packet Inc. (An Equinix Inc. Company)
Scaleway Inc.
Amazon Web Services Inc
Rackspace Inc.
CenturyLink, Inc.
LightEdge Solutions, Inc

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