Chlorinated Paraffin Wax Market: Driving on the Back of Growing PVC Product Demand

Chlorinated paraffin wax is among the key secondary plasticizers that are used in flexible PVC manufacturing. Its growing application in various industries, including rubber, paints, lubricating additives, metalworking fluids, plastic additives, and others, has opened new opportunities for the market.

Globally, growing number of building and construction projects and technological advancements taking place in the automotive industry have increased the demand for PVC products. As PVC products include chlorinated paraffin wax in large quantities, more and more players are putting in additional efforts to increase the production of chlorinated paraffin wax. Pertaining to these factors and other advancements taking place in the chlorinated paraffin wax market, Transparency Market Research presents in-depth insights on the growth of this market, in its newly published report. All the key factors relating to global market growth, regional growth, and competitors analysis have been thoroughly discussed in the report.

chlorinated paraffin wax market strategy

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Growing Application of Chlorinated Paraffin Wax

The production of chlorinated paraffin wax dates back to the 1930s. Initially, its application was seen in fire retardants, plasticizers, fire retardants and plasticizers in paints, fillers and antistatic agents in plastics, antiwear additives in cutting oils, and similar other uses. However, at the time, the environmental effects of using chlorinate paraffin wax were not known to the industry. But as its use increased and its production process evolved, its adverse effects on the environment came to light. To counter the harmful environmental effects of chlorinated paraffin wax, regulatory bodies such as the U.S. Environmental Protection Agency, Toxic Substance Control Act (TCSA), and others imposed various regulations and started governing and limiting its use.

Short-chain chlorinated paraffin wax is banned in various countries, and some other countries limit its use. On the other hand, regulations related to long-chain chlorinated paraffin wax are comparatively less. Despite growing restrictions, the consumption of chlorinated paraffin wax has increased in various industries such as paints and coatings, rubber, plastic additives, and others. In 2018, the global chlorinated paraffin wax market had a revenue of ~ US$ 1.6 billion, which is expected to reach ~ US$ 2.2 billion by the end of 2027.

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Ongoing Trends Influencing Market Growth

Growth in the Metalworking and Paints & Coatings Industries to Spur Demand

Globally, the demand for chlorinated paraffin wax has grown immensely in the metalworking and paints and coatings industries. Increasing domestic manufacturing in the fabrication and metalworking industries in most of the Asia Pacific countries has resulted in expanding the use of chlorinated paraffin wax. Medium-chain chlorinated paraffin provides necessary lubrication at high temperature and pressure, which has further increased its demand in industrial cutting fluids and metalworking lubricants as a high-pressure additive. In the paints and coatings industry, chlorinated paraffin wax acts as a secondary plasticizer. Additionally, increasing building and construction projects in India and China are also expected to drive the demand for chlorinated paraffin wax. China is the leading market in Asia Pacific, and the application of chlorinated paraffin wax is high in metalworking fluids in the country - expected to reach ~ 257 KT by the end of 2027.

Strict Environmental Regulations Restricting the Use of Chlorinated Paraffin Wax   

Concerns related to environmental pollution have increased with the growing use of chlorinated paraffin wax. Thus, various regulations in different countries have lead to restrictions on its use. Chlorinated paraffin is very persistent and very bioaccumulative (vPvB), and has proven systemic toxicity along with toxicity to aquatic and terrestrial organisms. Short-chain chlorinated paraffin has high bioaccumulation as compared to the other two; therefore, its use is banned in many countries. Moreover, short-chain and medium-chain chlorinated paraffin wax have low solubility in water; they are easily accumulated on soil, water, and organisms, which has a huge environmental effect.

Recently, the U.S. Environmental Protection Agency (EPA) has taken initiatives to examine metalworking fluids, due to the risks they pose to the environment and wildlife. According to EPA, short-chain chlorinated paraffin possesses the ability to kill small aquatic creatures. This has led to robust research and developments activities performed by major manufacturers to lower the negative impact of chlorinated paraffin wax on aquaculture. 

With environmental regulations getting stricter and increasing threats related to the use of chlorinated paraffin wax, the Stockholm Convention on Persistent Organic Pollutants is limiting the use of these types of chemicals. Dover Chemical Corporation, a leading manufacturer of chlorinated paraffin, and leading importer, INOVYN (formerly INEOS Chlor Americas, Inc.), had to pay huge fines as a result of not complying with these regulations.

global chlorinated paraffin wax market

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Focus on Advanced Technologies and R&D to Favor Market Growth

Capacity Expansion and Enhancing Manufacturing Facilities through R&D

Players in the global chlorinated paraffin wax market are looking forward to expand their presence in different regions. To achieve this, they are engaged in extensive research and development activities for catering to various technical requirements from flame retardant manufacturers.  A major chlorinated paraffin wax manufacturer, Dover Chemical, based in North America, has been investing in various research and development programs. The company’s aim to introduce a wide range of eco-friendly chlorinated paraffin wax products that offer various benefits such as ease of endurance to chloride, easy disposal, and resistance to corrosion. Initiatives such as these taken by leading players will help in reducing the environmental effect caused by chlorinated paraffin wax.

Membrane Technology Likely to Replace Mercury Technology

New technologies are expected to replace primitive technologies that were used to produce chlorinated paraffin wax. These newer technologies are projected to be more environmentally-friendly and consume less power during production. Emphasis on the use of membrane cell technology has grown significantly, especially in European countries, mainly to minimize the use of mercury cell technology. With mercury being a hazardous chemical, the European Parliament has issued the Industrial Emissions Directive (IED) to reduce its use. It is planning to completely phase-out the use of mercury by the end of 2020, and is promoting membrane cells, as they consume 26% less energy than mercury cells. Though the adoption of membrane cell technology will be capital-intensive, its rate of return is high, but in the long-run (nearly over 20 years). Despite these concerns, the shift from mercury cells to membrane cells is primarily driven by occupational health and environmental concerns.

For example, in 2019, INOVYN started the production of chlorinated paraffin at its new membrane chlorine cellroom at the Stenungsund site in Sweden, with the commissioning of a new plant. The Stenungsund cellroom is a new addition to INOVYN’s infrastructure, allowing its chlorinated paraffin to be available across Europe, by employing the best available membrane cell technology for manufacturing chlorinated paraffin wax.

Fragmented Vendor Landscape

The global chlorinated paraffin wax market is moderately fragmented, as many local/regional/new players hold ~ 60% share in the market. Leading players, including the top four companies -

  • INOVYN
  • Dover Chemical Corporation
  • NCP Chlorchem
  • Aditya Birla Chemicals

hold ~ 40% share in the market, due to which, they enjoy dominance of this market. Prominent players in the market are experiencing systematic growth through strategies related to product development and channel promotion. Huge investments made in research and development activities to diversify their product ranges are largely being undertaken by various companies. Moreover, customizing products as per the requirement of customers has also benefitted players in strengthening their position. Long-term raw material supply contracts and established distribution channels are offering existing key manufacturers with distinct advantages in terms of cost and product quality.

Additionally, they are also focusing on expanding their sales channels by marking their presence on online channels. Engaging with customers and suppliers through different direct and institutional sales channels is also widely being adopted as a key strategy. For instance, Inovyn (Ineos Chlor) entered into an agreement with Tri-iso Tryline, LLC for marketing its chlorinated paraffin wax products. Company portals are also available for direct sales and distribution of chlorinated paraffin wax across various regions.

chlorinated paraffin wax market segmentation

Analysts’ Insights on the Chlorinated Paraffin Wax Market

Analysts have a positive stance on the growth of the global chlorinated paraffin wax market. Though legislations in major markets around the world restrict the presence of short-chain chlorinated paraffin wax in final products, medium-chain chlorinated paraffin wax is also considered toxic by some agencies. But with the immense use of chlorinated paraffin wax in the production of various end products, including paints & coatings, plastic additives, etc., the market is expected to generate a revenue of ~ US$ 2.2 billion by the end of 2027. Players in the chlorinated paraffin wax market are engaged in extensive research and development activities, and are adopting new technologies to reduce its harmful effects on the environment and animals. From a sales perspective, companies need to strengthen their sales and distribution networks, which will help them in getting a stronghold in the market.

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Chlorinated Paraffin Wax Market: Overview

  • Chlorinated paraffin wax is one of the major secondary plasticizers used in flexible PVC manufacturing.
  • The usage of chlorinated paraffin wax increases the flame retardant property in PVC products such as PVC cables and flooring. Additionally, the lower cost of chlorinated paraffin wax vis-à-vis other plasticizers lowers the overall cost of manufacturing.
  • Chlorinated paraffin wax is used as a plasticizer in paints and coatings, sealants and adhesives, and rubber products such as industrial belts and conveyor belts, due to properties such as flame retardancy and inertness.
  • Chlorinated paraffin wax constitutes 4% to 10% (by weight) of paints and rubbers.
  • Rise in the demand for PVC products in developing countries such as India and China is anticipated to drive the chlorinated paraffin wax market in these regions.
  • Chlorinated paraffin wax is also employed majorly in metalworking lubricants. It is primarily used as an extreme pressure additive in these lubricants. Chlorinated paraffin wax is also used in a broad range of engineering and machining operations, wherein, the demand for extreme pressure lubricants is high.
  • Increase in metal cutting operations in industrial applications in Asia Pacific and Latin America is estimated to drive the chlorinated paraffin wax market in these regions. Apart from major applications such as plasticizers and lubricants, chlorinated paraffin wax is employed in artificial leather and textiles owing to its fire-retardant properties.

Chlorinated Paraffin Wax Market: Segmentation

  • The chlorinated paraffin wax market has been segmented based on grade, application, and region.
  • Based on grade, the market can be segmented into medium-chain chlorinated paraffin wax (MCCP) and long-chain chlorinated paraffin wax (LCCP). The MCCP segment dominated the chlorinated paraffin wax market in 2018, owing to its high demand as a flame retardant or plasticizer in rubbers, plastics, inks, adhesives, paints, and surface coatings. The demand for LCCP is expected grow at a significant rate, owing to its increasing usage as an additive in PVC, rubber, sealants, paints and coatings, metal cutting/working fluids, leather fat liquors, and textile treatments.
  • In terms of application, the market has been segregated into lubricating additives, plastic additives, rubber, paints, metal working fluids, and others (including adhesives & sealants and fabrics). Chlorinated paraffin wax is commonly used in secondary plasticizers in PVC compounds due to its properties such as low cost and flame retardancy. Chlorinated paraffin wax is suitable as a flame retardant and secondary plasticizer if it replaces primary plasticizers within the range of 25% to 30%.
  • The global chlorinated paraffin wax market is likely to expand at an average rate during the forecast period, due to the availability of application-specific substitutes and potential prohibition on the usage of chlorinated paraffin wax in developed regions.
  • However, the lucrative nature of applications such as lubricating additives, plastic additives, and metalworking fluids in developing countries is anticipated to increase attractiveness of the chlorinated paraffin wax market during the forecast period.

Chlorinated Paraffin Wax Market: Region Analysis

  • Based on region, the global chlorinated paraffin wax market has been split into North America, Europe, Asia Pacific, Latin America, and the Middle East & Africa.
  • Currently, countries in Asia Pacific such as China, India, Indonesia, Japan, and South Korea are considered to be the center of gravity for the global fabrication and metalworking industry.
  • The growing trend of domestic manufacturing of chlorinated paraffin wax is fueled by the growth in end-user industries.
  • Chlorinated paraffin wax is primarily used in industrial cutting fluids or metalworking lubricants as a high-pressure additive. It possesses the property of providing the necessary lubrication at high temperature and pressure, thus making it suitable for large metal cutting operations.

Chlorinated Paraffin Wax Market: Structure

  • The chlorinated paraffin wax market is moderately consolidated; the market is dominated by key companies.
  • Long-term raw material supply contracts and established distribution channels offer existing key manufacturers with distinct advantages in terms of cost and product quality.
  • Strict regulations on manufacturing and potential prohibition in developed regions are likely to reduce the competition in developed regions. Thus, the degree of competition is projected to increase from medium to high during the forecast period in developing regions, and reduce in developed regions.

The chlorinated paraffin wax market is dominated by large players. Key players operating in the global chlorinated paraffin wax market include

  • INOVYN
  • NCP Chlorchem
  • Dover Chemical Corporation
  • LEUNA-Tenside GmbH
  • Química Del Cinca
  • Caffaro Industrie S.p.A.
  • JSC Kaustik
  • KLJ Group
  • Qualice
  • LLC
  • Makwell Group,
  • Aditya Birla Chemicals
  • Altair Chimica SpA.

Chlorinated Paraffin Wax Market: Introduction 

Recently, Transparency Market Research (TMR) published a new report on the global chlorinated paraffin wax market to unfold the growth prospects of this market over the period of 2019 to 2027. The report gives key insights with respect to various companies functioning in the chlorinated paraffin wax market, and assists them in benefiting from the untapped potential in this market. 

Researchers have covered all the key drivers, restraints, opportunities, and threats that are influencing the growth of the global chlorinated paraffin wax market. Ongoing trends and government regulation with respect to chlorinated paraffin wax usage are also thoroughly discussed in the report. Microeconomic as well as macroeconomic factors related to the chlorinated paraffin wax market are given equal importance, so as to access revenue-wise growth of chlorinated paraffin wax. 

Stakeholders and market players can find information regarding key developments in the chlorinated paraffin wax market, along with the key strategies used by leading players to strengthen their position in the chlorinated paraffin wax market. Insights presented in the chlorinated paraffin wax market report are backed by statistical information that is presented in value (US$ Mn) and volume (KT units). Additionally, information related to the competition landscape and geographical reach are elucidated in a comprehensive manner.  The study also offers a market share analysis for each company, along with details regarding financials, key strategies, SWOT analysis, and recent developments in the chlorinated paraffin wax market. 

Chlorinated Paraffin Wax Market: Segmentation 

The global chlorinated paraffin wax market is categorized on the basis of grade and application. Information on these categories is also given with respect to individual countries, which helps in understanding the regional growth of each category.  The main objective of the report is to offer valuable insights regarding the demand trends for chlorinated paraffin wax in different applications.

Grade

Application

Region

  • Medium-chain Chlorinated Paraffin Wax (MCCP)
  • Long-chain Chlorinated Paraffin Wax (LCCP)
  • Lubricating Additives
  • Plastic Additives
  • Rubber
  • Paints
  • Metal Working Fluids
  • Others (Includes
  • Adhesive & Sealants,Fabrics)
  • North America
  • Latin America
  • Europe
  • Asia Pacific
  • Middle East and Africa

Questioned Answered in the Chlorinated Paraffin Wax Market Report

Researchers have also answered some key questions regarding the use and regulatory policies related to chlorinated paraffin wax. Some of the key questions answered in the global chlorinated paraffin wax market report include:

  • What are the key regulatory policies related to the use of different types of chlorinated paraffin wax?
  • What is the expected revenue generation in the global chlorinated paraffin wax market in 2027?
  • Which region is expected to lead the global chlorinated paraffin wax market, and what are the reasons behind its growth?
  • What are the key strategies used by leading players in the global chlorinated paraffin wax market?
  • What is the environmental effect of using chlorinated paraffin, and how are players and governments managing this?
  • What is the reason behind banning short-chain chlorinated paraffin wax?

Chlorinated Paraffin Wax Market: Research Methodology

While investigating the growth areas of the global chlorinated paraffin wax market, analysts emphasized on paraffin wax and chlor-alkali in order to fetch general industry trends on chlorinated paraffin wax and the PVC market. This helped in making a clear outline of the ongoing trends in the chlorinated paraffin wax market. To derive complete insights, researchers carried out a top-down and bottom-up approach.

While conducting primary research, analysts had face-to-face interactions with C-level executives, raw material suppliers, distributors, and manufacturers. Region wise, primary research was mainly focused on North America, Europe, and Asia Pacific. For secondary research, information was gathered from company websites, financial reports, annual reports, SEC filings, and investor presentations. Various internal and external proprietary databases along with relevant patent and regulatory databases were also analyzed.

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