Global fine chemical market

Fine chemicals form a group of products of large variety their number exceeds 10,000. The size of the global fine chemicals market in 1993 was estimated at 42,000 million. The average annual growth in the period 1989-95 was about 4.5 % (Polastro < r a/., 1990). Figure 1.1. shows the division of fine chemicals production by outlet. 

The new production capacity that has come onstream in Asia since the mid-1990s has allowed the fine-chemical companies in these countries to capture a close to 50% share of the global merchant market for API-for-generics, the only segment of the industry where demand has developed favorably lately (see text below). The pharmaceutical industry itself, plagued by underutilized capacity, has gone more aggressively after third-party business. 

Business aspects are changing due to the expansion of the globalization of the world economy There are more potential competitors in this enlarged market. The best low-cost position is necessary to obtain and maintain market share. This is true for the fine chemical and pharmaceutical industries, because transportation costs are only a small amount of total production costs and because the total global market may in theory be supplied by producers from any place in the world. On the other hand, for the bulk chemical industry as well, small cost... 

The potential for industrial biotech has been broadly recognized and chemical and biotech companies are starting to move into this space and grow their presence. In fact, about five percent of the estimated USD 1.2 trillion total chemical sales already depend on biotech. The global market for bio-based ethanol alone is worth USD 15 billion other basic organic molecules such as citric acid (USD two billion) and lactic acid are produced by fermentation, and so are all but three amino acids (approx. USD four billion) various basic, advanced and active pharmaceutical ingredients produced by the fine chemical industry are worth USD 7.5 billion the attractive enzyme market has reached USD two billion in... 

As in the case of specialty chemicals, fine chemical multinationals with a global reach are likely to become partners of choice for their multinational customers. However, in selected market segments, European custom synthesis or building blocks suppliers face aggressive competition from China as their Chinese competitors are in a superior cost position for the following reasons ... 

Both processes have advantages and disadvantages. Currently, they have about an equal share of the global market. The initial investment cost in the irradiation equipment is high, but it is considerably more productive than chemical cross-linking, having the additional advantage of uniform product quality and flexibility of feedstock selection. The product from radiation cross-linked polyolefins is thin, with fine cells and smooth white surfaces. The comparison of chemical and radiation processes is in Table 8.8. ... 

This point evidences the slow turnover in changing technologies to more sustainable ones, even in the case of evident economic advantages. When these aspects are less relevant, such as in the case of the process cited above of isobutane alkylation, the turnover is even lower. In the field of fine and spedalty chemicals production, where the fixed costs are much lower, the rate of introduction of the novel, more sustainable processes, could be faster, but it is contrasted with the lower economic incentives, due to lower production volumes. In refinery/base petrochemistry, the product volumes justify the introduction of new processes, but the problem instead is the large cost of construction (and sometimes also revamping) of the plants in a period where uncertain economics, due to a global market, disincentives new investments. This is the dilemma for sustainable chemical processes. 

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