Warren Buffett, as we pointed out, knows a good market when he sees one.
U.S. specialty chemicals market volumes gained 0.9% in December, according to research by the American Chemistry Council. This overall category growth and strong uptick at the end of the year was certainly glowing good news for Coast Southwest, being a proud member of the specialty chemicals industry.
It looks like the category will fulfill all the high expectations analysts – and smart investors like Mr. Buffett – have seen for it.
Specialty chemicals are used on the basis of their very specific performance or function, and can be single-molecule entities or formulations of molecule entities. Unlike commodity chemicals, specialty chemicals have just one or two uses, but their effectiveness makes them of the utmost importance to a wide variety of industries, ranging from aerospace to cosmetics.
The ACA monitors 28 specialty chemical segments and found that 25 of those expanded in December. Moreover, the remaining three segments were stable, meaning none of the markets experienced a decline. We’d say that’s pretty impressive performance.
Large market volume gains (1.0% or more) occurred in a multitude of categories including “lubricant additives, mining chemicals, oilfield chemicals, plastic additives, plasticizers, and plastic compounding,” according to Happi.
There are even more exciting developments up the road…
Building on the overall expansion last year, there are even more exciting developments seen up the road for the specialty chemicals market. Several specialty chemicals segments are projected to grow faster than the average 3% annual growth rate forecast for 2016–2021.
Particularly notable? The expected growth of the cosmetic chemicals, nutraceutical ingredients, and flavors fragrance categories. The level of consumer demand for new products in each of these areas shows no sign of letting up, and that craving is now a global phenomenon.
The growth will keep on going…
The above-average growth for these categories is due to a correspondingly sunny forecast for the overall markets utilizing these particular specialty chemicals. The cosmetic chemicals category, in particular, will enjoy continued skyrocketing growth thanks to two key factors:
- There’s has been increased consumer spending in North America, Western Europe, and Japan, especially for luxury and prestige cosmetics and personal care items.
- Plus, there’s been an overall rise in the disposable income and spending in developing countries, leading to boosted sales of personal care products.
The specialty chemicals market will keep flourishing in the coming months and years, owing to how vital they are in the creation of the ever-expanding range of products and technologies modern society needs and consumes.
It’s a challenging and invigorating category for those of us lucky enough to be part of it; working in specialty chemicals demands extensive knowledge, adherence to strict standards, and a commitment to continual innovation. So we’re always on our toes…and thrilled to be a part of whatever comes next!
