Toluene Market

Toluene Market Size (2023-2028):

Toluene Market was valued at USD 29.14 billion in 2022 and is expected to reach USD 35.14 billion in 2028, with a CAGR of 8.39% between 2023-2028

Toluene, formerly known as toluene and ethylbenzene, is an aromatic hydrocarbon used as an industrial raw material and as a solvent. Toluene is considered an aromatic compound due to the presence of a benzene ring in its chemical structure. Toluene is used industrially as a solvent in paint thinners, nail polish removers, glues, and correction fluids. Increased demand for toluene derivatives like benzene and xylene are the main drivers of global market growth. This is because they are an important by-product of the styrene manufacturing process and are used in gasoline blends. However, the use of toluene as an octane enhancer in gasoline fuels has led to an increased demand for toluene in the world market. People are looking for better quality fuel to make their cars more efficient. Toluene, being a good solvent, can dissolve many organic components and therefore has applications in various industries to produce various commercial products. For this reason, the demand for toluene is supposed to experience significant growth during the evaluation period.

Toluene Market Drivers:

There is an increasing demand for toluene due to its wider use in gasoline blends. Toluene acts as an octane booster and maintains the energy content of gasoline. In addition, toluene's low sensitivity characteristics and its high octane ratings make it ideal as a fuel in heavily loaded engines. In addition, the increased demand for aromatics in the petrochemical industry in the development of synthetic fibers, elastomers, agrochemicals, dyes, and nail paints is an emerging factor that increases market growth. The surge in demand for toluene as an octane enhancer in gasoline has resulted in augmented demand for toluene in the world market. In addition, India and China have experienced significant development in the chemical industry, due to the constant growth of the economy and the increase in the standard of living. In addition, the growing demand for toluene as a raw material in the production of benzene and xylene is increasing globally, leading to market growth.

Toluene Market Restraints:

However, as it is considered a hazardous air pollutant (PAH) and toxic substance by the Environmental Policy Agency (EPA), and due to its acute and chronic effects on the central nervous system (CNS), the use of toluene in Europe and America is in decline.

Opportunities in the Toluene Market:

The global toluene market offers various opportunities for the players owing to the disposable income and the rapid growth of the global economy. The production of toluene diisocyanate (TDI) is foreseen to be the second-highest derivative market, due to its higher demand in the manufacture of polyurethane, resulting in a higher demand for toluene in the formation of toluene diisocyanate (TDI). In addition, the growth of end-user industries (agrochemicals, cosmetics, and explosives) based in Asia-Pacific and Latin America is likely to drive market growth. In addition, continued investment in developing countries and the expected recovery in global markets are predicted to further drive business growth.

Challenges in the Toluene Market:

Fluctuations in crude oil prices have always been a major challenge in the toluene market, as certain petroleum fractions are used as feedstock to produce toluene. The prices of toluene are constantly changing due to factors such as volatile oil prices and changes in supply and demand. For example, in November 2019, crude oil prices rose 0.86% per barrel in futures trading. This increase will result in a hike in operating costs and therefore affect the growth of the toluene market.

TOLUENE MARKET REPORT COVERAGE:

Toluene Market Segmentation as per the research report until 2028.

Toluene Market - By Derivative Type:

• Benzene & Xylene

• Toluene Diisocyanates

• Solvents

• Gasoline Additives

• Others (Benzaldehyde and Benzoic Acid)

The benzene and xylene segment held the largest market share due to the fact that these derivatives are used in the gasoline blend to improve its quality. In addition, the solvent was the second largest share of the global toluene market, due to its increased demand in the cosmetics and paints and coatings manufacturing industry.

Toluene Market - By Production Process:

• Reformate Process

• Pygas Process

• Coke/Coal Process

• Styrene Process

Toluene Market - By Application:

• Drugs
• TDI
• Dyes
• Blending
• Cosmetic Nail Products
• Others (TNT, Pesticides, and Fertilizers)

The TDI segment is anticipated to be growing rapidly in the toluene market during the forecast period. It is mainly used in the production of polyurethane foams, which are widely used in industries such as oil and gas, building and construction, and automotive for insulation applications. Rising energy costs and greenhouse gas emissions have also led companies to improve the energy efficiency of homes and industrial buildings, leading to the increasing use of polyurethane foams as insulation in industrial construction. PU is also used in automobiles due to its lightweight, which reduces fuel emissions. These unique characteristics of PU foams are expected to drive their demand in the automotive industry, which in turn drives the market for TDI, which is an important raw material for the production of PU.

Toluene Market - By Region

• North America 

• Europe 

• Asia Pacific

• Latin America 

• Middle East & Africa 

Asia-Pacific held the largest market share in 2020 and is supposed to be the dominant regional market during the outlook period. Due to the expansion of the region's oil and gas industries and lenient government regulations regarding the use of toluene, demand for toluene is increasing in the regional market. Countries like China, India and South Korea dominate the Asia-Pacific market.

North America held the second-largest share of the toluene market in 2020, due to the presence of the region's major oil and gas leaders. The increase in construction and construction activities and the expansion of the automotive industry are generating an increased need for consumer goods such as paints and coatings and polyurethane foams, which use toluene as the main solvent, which is increasing its growth in the regional market.

Europe is expected to grow slowly due to strict government policies in the region regarding the use of toluene, due to the health issues caused by toluene. However, the mature automotive market, which uses toluene in its gasoline fuels to improve fuel quality, helps maintain the continued demand for toluene in the region.

Impact of COVID-19 on Toluene Market

The number of coronavirus cases is rising rapidly, which has not only killed several people but also affected the global economy. The pandemic (COVID-19) has influenced all regions of the globe. This virus has changed all the market conditions and is hindering the growth of different sectors of the toluene market.

Toluene Market Key Players:

1. Exxon Mobil Corporation (US)

2. Covestro AG (Germany)

3. BP p.l.c. (UK)

4. China Petroleum & Chemical Corporation (China)

5. BASF SE (Germany)

6. Royal Dutch Shell plc (The Netherlands)

7. Formosa Chemicals & Fiber Corporation (Taiwan)

8. Indian Oil Corporation Ltd (India)

9. TOTAL S.A. (France)

10. DuPont de Nemours, Inc (US)

11. SK innovation co. Ltd (South Korea)

12. CPC Corporation (Taiwan)

13. GS Caltex Corporation (South Korea)

14. China National Petroleum Corporation (China).