What’s Hot in the Chemicals, Materials & Food
Industry
May 2012
Trends, Opportunities, and Challenges through the Eyes of
Key Players in the Sector
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Table of Contents
What’s Hot in 2012 8-16
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Ø Key Perspectives on Growth in the Chemicals, Materials & Food Industry in 2012
Ø Market Highlights for 2012
Ø What Participants see as Hot Topics in 2012
Ø Convergence with other Industries
Ø Global Hot Spots in the Chemicals, Materials, & Food Industry
Ø Four Big Predictions for 2012
Ø Chemicals, Materials and Food – The “Link” to all Sectors
About Frost & Sullivan 17-22
Ø About this Market Insight
Ø Hot Topic Thought Leader
Introduction 5-7
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About this Market Insight
Based on a survey of several hundred key companies conducted across Europe in December 2011, this
Market Insight highlights the hot topics for growth that have been identified in the chemicals, materials
and food sector for 2012 and beyond.
Data and opinions of key stakeholders, combined with analysis and commentary from Frost & Sullivan
industry experts, have been used to present key market highlights, hot growth topics, global and regional
hot spots, areas of market convergence, and bold predictions for 2012.
In this study, a summary of the highest growth areas for the chemicals, materials & food industry is
presented.
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Functional Expertise
12 years of materials and chemicals research experience, which include 4 years of strategy consulting
experience. Particular expertise in:
– Green Building Materials, Composite Materials, Biolubricants, Cosmetics
Industry Expertise
Experience in covering broad range of sectors, leveraging long-standing working relationships with leading
industry participants’ Senior Executives
- Chemicals & Petrochemicals
- Infrastructure (Water treatment, Photovoltaic Systems, Wind energy)
- Construction (Chemicals, Green materials, Advanced Glazing Systems)
- Ingredients (Cosmetics)
What I bring to the Team
Expert research and analytical skills providing strategic input to business growth models
Forecasting model development, Competitive environment analysis and benchmarking
Strategic thinking
Career Highlights
Extensive business knowledge of the petrochemical, materials and FDC sectors. Selected consulting projects
for several leading firms:
- Clariant, Switzerland, DuPont, US, Huntsman, Switzerland, L’Oreal, France, Mitsui Sumitomo Insurance,
UK, Merck, Germany, BASF, Germany Aditya Birla, Thailand
Education
Post Doctorate Diploma in NDET of Materials from University of Southampton, Southampton, UK
Post Doctorate Diploma in Smart Materials from University of Southampton, Southampton, UK
PhD in Materials Science from University of Southampton, Southampton, UK
MSc in Advanced Manufacturing Technologies & Systems Management from U.M.I.S.T., Manchester, UK
BEng (Hons) in Mechanical Engineering from University of Salford, Manchester, UK
Dr Leonidas Dokos – Hot Topic Thought Leader
Dr Leonidas Dokos Global Programme Manager
Frost & Sullivan
Europe
Oxford, UK
Place photo here
Shadow Background
for effect
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Key Perspectives on Growth in the Chemicals, Materials
& Food Industry in 2012
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In terms of emerging markets China, Brazil and Russia are the top priority for construction and utilities players, while for transportation players the focus is on China, India and Brazil.
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Green chemicals, trends in the bioplastics market, and the emerging trends in Personal Care (multifunctional, botanical) are the top priority opportunities for Food, Drug & Cosmetics providers.
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The Food & Beverage suppliers are looking at the following 3 emerging markets – China, India and Brazil while in Europe the focus is on bakery ingredients.
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The 5 key industries tracked by Chemicals, Materials and Food practice are Construction & Utilities, Transportation, Foods & Beverage, Personal Protective Equipment, and Food Drug & Cosmetics.
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The Western European market remains the priority for EU based manufacturers over other regions. North America and Eastern Europe represent the next priority.
Source: Frost & Sullivan analysis
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Market Highlights for 2012
• The four mega trends of low carbon economy, health and wellness, functionality and performance, and
globalisation define the developments in the chemicals, materials and food industry
• The food, mobility and construction markets remain core developments for 2012 exhibiting growth overall and
driven by the emerging economies
• Renewable energy applications, such as photovoltaics, wind turbines and solar thermal continue to present
healthy growth opportunities in developed markets such as Europe and the USA but investors are apprehensive
• Targeted consolidation in the chemicals and materials industry continues as the theme of the recent years but the
number of closed deals will be smaller due to widespread lack of cash availability
• The continuing debt crises in the eurozone and the high US government debt continues to undermine the speed
of the macroeconomic recovery of markets and the level of investment available
• The uptrend in oil prices is affecting the raw materials prices and profit margins once more
• Indian demand for chemicals will grow on the back of massive growth in end-user industries such as automotive
production
• China's development of green technology will draw in strong chemicals investment, even for technologies such as
electric vehicles
• Brazil continues to become a major centre of supply for biobased feedstocks
• Massive developments in crops used as biofeedstock for the production of fuels, chemicals and materials - algae
will be a critical area of development
Key Market Highlights
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Chemicals, Materials & Food
What Participants see as Hot Topics in 2012
Rank Market Topic % of Respondents Nominating as Hottest Topic
1 Functional Foods: Mega trends 56%
2 The Impact of Globalisation Megatrend on the Automotive Materials 49%
3 Construction Chemicals Market 48%
4 High Performance Plastics in Automotive 43%
5 Protective Clothing Markets 43%
6 Green Chemicals in FDC 42%
7 Water and Wastewater Treatment Chemicals Market 39%
8 Bioplastics Market Trends in FDC 38%
9 Function foods & beverages: industry outlook 36%
10 The Impact of Low Carbon Economy Megatrend on Feedstock Oriented Markets 35%
11 Bioplastics Market and Trends in Transportation 35%
12 Strategic Analysis of the Chemicals and Materials Market for Solar Thermal 33%
13 Function food & beverages: Trend watch 33%
14 PPE Markets 32%
15 Market for Decorative & Protective Paints and Coatings 30%
Chemicals, Materials & Food: Identification of Hot Topics (Europe), 2012
N=112
Filter: Respondents who are planning to track Chemicals, Materials & Food
Further filter on market segment tracked (Chemicals & Materials in Food, Drugs and Cosmetics, Chemicals & Materials in
Construction & Utilities, Chemicals & Materials in Transportation, Food & Beverage Ingredients) Source: Frost & Sullivan analysis
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Chemicals, Materials & Food
Convergence with other Industries
Source: Frost & Sullivan analysis
Key Industries Tracked in Addition to Company’s Core Markets (Europe), 2012
Core Market Cross-interest 1 Cross-interest 2 Cross-interest 3 n
A&D Security 50% ICT 29% Electronics 24% 42
A&T Electronics 24% ICT 19% EPS 12% 86
CMF A&T 40% EBT 36% EPS 30% 53
Electronics M&I 53% EPS 47% IPC 47% 15
EPS EBT 32% IPC 21% A&T 15% 73
EBT EPS 58% ICT 15% M&I 15% 26
HC CMF 18% ICT 14% M&I 8% 90
IPC EPS 74% A&T 41% EBT 26% 27
ICT A&T 30% EPS 24% HC 21% 66
M&I EPS 25% EBT 25% IPC 25% 8
PPE A&D 17% CMF 17% EPS 17% 12
Security ICT 39% A&D 33% EBT 33% 18
A&D = Aerospace & Defence
A&T = Automotive & Transportation
CMF = Chemicals, Materials & Food
EPS = Energy & Power Supplies
EBT = Environment & Building Technologies
HC = Healthcare
IPC = Industry & Process Control
ICT = Information & Communication Technology
M&I = Measurement & Instrumentation
PPE = Personal Protective Equipment
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Chemicals, Materials & Food
Convergence with other Industries (Contd ...)
Source: Frost & Sullivan analysis
Construction
& Utilities
Transportation
Food, Drug
& Cosmetics
Food &
Beverage
Automotive & Transportation Aerospace & Defence Healthcare Environment, Building
Technologies, Power
Systems
Chemicals and Materials PPE
Lightweight Materials, Composite Materials, Coatings, Functional Fluids, Fuel & Lubricant Additives, Adhesives, Elastomers, Electric Vehicles , Catalysts
High Speed Rail Infrastructure
Low Carbon Economy
Smart Grid, Photovoltaic/Solar
thermal , Wind Energy, Water,
Green Materials
Materials & Batteries for EV Infrastructure
Bioplastics for Packaging
Personal Wellbeing
Antimicrobial coatings, Biocides
for Water Treatment
Excipients, Plastics for
Medical Devices Nutricosmetics &
Nutraceuticals, Multifunctional &
Natural Active Ingredients,
Functional Foods
Key Areas of Technology Convergence
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Global Hot Spots in the Chemicals, Materials, & Food
Industry
Chemicals, Materials and Food Markets: Global Hot Spots (World), 2012
• EPA’s Existing Chemicals Programme Strategy identified 7 chemicals out of a list of 83 for risk assessment in 2012
• Industry consolidation to continue • Restarting of the “rare earth
materials” industry
Source: Frost & Sullivan
The Middle
East
Russia
Europe
Africa
Latin America
North America
APAC India
China
• Emerging Oil & Gas market opportunities
• Infrastructure development and construction
• Chemicals & Materials for Water & Agriculture
• Latin American hub for bioethanol and exports to neighbouring nations
• Hot spot for biobased feedstocks • Increasing focus in oil and gas exploration • Restructure in the state petrochemicals
companies • Brazil is construction hot spot until 2016
(Football World Cup and Olympic Games)
• High Population and development needs across all sectors: transportation, construction, infrastructure, sanitation, healthcare, food
• Highly skilled labour and low costs – attractive market for partnerships
• Growing affluent middle-class with spending power for personal care
• Need for prevention and better general health drives the functional F&B products
• Increasing private healthcare expenditure • Poland and Czech Republic present healthy
growth market and R&D opportunities • Economic contraction continues affecting the
Southern European countries
• Russia presents significant opportunities across sectors, especially in construction, water treatment, transportation and PPE
• Manufacturing and consuming hub • Continuous increase per capita
usage of chemicals • Increasing competency in R&D and
high-value added products • Growth opportunities driven by
new infrastructure, mega-cities and mobility
• Large population base and low costs
• Growing economies with increasing per capita spending power
• Vast supply of feedstock • Strategic alliances with American
and European companies • Construction growth resumed • Geopolitical challenges
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Four Big Predictions for 2012
2 “Mass Customisation“ will impact a wide range of manufactured products,
as experienced in the automotive sector, and will result in high demands
for innovative chemicals and materials
3 Industry consolidation to continue with a mega acquisition of a Top 100
global chemicals company headquartered in Europe to be the headline
news
1 2012 will be the year of “green” technology routes and products, and
especially bioplastics
Source: Frost & Sullivan analysis
4 Weight management, heart health, and digestive health will be the high
growth sectors in Food and Beverages
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