In one of its latest market intelligence reports, Frost & Sullivan predicts Mexico’s industrial water and wastewater treatment chemicals market will grow at a compound annual growth rate of 6.7 percent from 2012 to 2017. The Mountain View, Calif.-based global growth consulting company says the size of the market will grow from $342.9 million in 2012 to $473.1 million at the end of forecast period.
According to the report, titled The Mexican Industrial Water and Wastewater Treatment Chemical Market: Exchange Growth due to Environmental and Social Sentiment, the coagulant and flocculant segment represents 38 percent of the total market in revenues. This is followed by the scaling and corrosion control chemicals segment, at 27 percent market share, and disinfectants and biocides, at 21 percent. Frost & Sullivan says despite the market’s maturity, opportunities for innovation still exist in the long term, especially in coagulants and flocculants as well as the disinfectant and biocide segment.
There are 15 companies in the Mexico water and wastewater treatment chemicals market, led by Nalco, GE-Betz, Kurimexicana, Buckman, and Ashland. They serve industries including pulp and paper, oil and gas, chemicals, sugarcane and ethanol, food and beverage, textiles, and mining, through direct sales and chemicals distributors.
Indeed, because of the market’s mature stage, “the total market is dominated by commodity chemicals, but a trend of substitution to specialties exists” while “commoditization will lower margins continually,” Frost & Sullivan reports. The biggest market driver for chemical treatment in Mexico over the next five years, according to the report, will be increasing water prices and industrial companies’ decisions to recycle water. But the market will continue to rely on traditional treatment methods because of their cost efficiency, thereby putting pressure on chemical price margins.
Outside of the manufacturing industries, mega trends such as urbanization and drinking water and sanitation needs will continue to impact the treatment chemicals market, followed by sustainability and waste reduction trends in the next three-plus years.