The global magnesium hydroxide market is projected to register a healthy CAGR of 5.47% during the forecast period. The growth of the global market is attributed to the high demand for magnesium hydroxide in wastewater treatment, fuel additive, and flame-retardant applications. The rapid industrialization has increased the demand for energy, wastewater treatment chemicals, and thermal insulation materials, which positively is expected to impact the demand for magnesium hydroxide. The companies in the global market are expanding the production plants, for instance, ExxonMobil has established the largest resin production plant to manufacture hydrogenated hydrocarbons resin and halobutyl rubber in Singapore in June 2018.
The economic development has increased the demand for non-residential buildings such as commercial spaces, factories, and malls worldwide, which in turn is expected to boost the demand for insulation products in the construction industry. Further, rising concern and ban on hazardous and toxic flame-retardant fillers such as chlorine and bromine are propelling the application of magnesium hydroxide in flame-retardant fillers. Thus, the companies operating in the global magnesium hydroxide market are expanding production capacities and launching non-halogenated flame retardants filler materials comprising magnesium hydroxide. Some of the companies are focusing on strategic initiatives such as acquisitions and partnerships with other industrial players to achieve competitive advantage and higher market value.
The key players operating in the global magnesium hydroxide market include Martin Marietta Magnesia Specialties, LLC, SPI Pharma, NikoMag, Kyowa Chemical Industry Co., Ltd, Huber Engineered Materials, ICL, Nedmag B.V., Russian Mining Chemical Company, Merck KGaA, PremierMagnesia LLC. The magnesium hydroxide market is estimated to witness healthy growth during the forecast period, which is likely to attract new players and witness high investment in R&D for magnesium hydroxide.
Threat of New Entrants
The global magnesium hydroxide market is expected to witness a medium to high threat of new entrants during the review period, as the demand for magnesium hydroxide is increasing in the end-use industries such as construction, plastics, and rubber. Huge growth potential in the end-use industries is attracting a large number of players. In addition, favorable government policies due to the eco-friendly and non-toxic nature of magnesium hydroxide are also favoring the entry of new entrants. However, the high processing cost of magnesium hydroxide is expected to act as a barrier for the new entrance.
Intensity of Rivalry
The global magnesium hydroxide market has a large number of players—tier 1, tier 2, and local players. At present, the intensity of rivalry among the players operating in the market is moderate to high, on account of the growing demand from various end-use industries. The market players are likely to acquire, collaborate, or enter into partnerships with other industrial players to develop new products and expand business operations worldwide, which is expected to intensify the rivalry. The high demand for magnesium hydroxide has further influenced several players to initiate strategic development and expansion to gain higher market share and strengthen their position in the global magnesium hydroxide market, which is also expected to intensify the rivalry.
Threat of Substitutes
The threat of substitutes in the global magnesium hydroxide market is expected to be moderate as the use of caustic soda to treat wastewater alkalinity over magnesium hydroxide has declined due to the unique biological properties of magnesium hydroxide. Similarly, application of magnesium hydroxide as an alternative to bromine and chlorine-based fillers in flame retardant is also increasing. However, magnesium hydroxide is not completely used as a substitute due to the high prices compared to other counterparts keeping the threat of substitutes is moderate.
Bargaining Power of Suppliers
The bargaining power of suppliers is expected to be low to moderate. A large number of players are operating in the market, which reduces the bargaining power of suppliers. Lack of product diversification among suppliers has led to lower switching cost. In addition, the availability of a few alternative products in applications such as water treatment chemicals and flame retardant give an upper hand to the buyers. The high demand and low supply of magnesium hydroxide are expected to maintain the bargaining power of suppliers from low to moderate.
Bargaining Power of Buyers
The bargaining power of buyers is expected to be moderate to high due to the availability of a large number of suppliers. The buyers are not reliant on specific supplier due to lack of differentiation in the product offered, which is expected to result in moderate to high bargaining power of buyers.
