Low GWP Refrigerants Market
Analysis by Type (Fluorocarbons, Hydrocarbons, and Others); and by Application (Commercial, Domestic, and Industrial Refrigeration) – Global Supply & Demand Analysis & Opportunity Outlook 2023-2035
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Analysis by Type (Fluorocarbons, Hydrocarbons, and Others); and by Application (Commercial, Domestic, and Industrial Refrigeration) – Global Supply & Demand Analysis & Opportunity Outlook 2023-2035
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The global low GWP refrigerants market is estimated to garner a revenue of ~USD 86 Billion by the end of 2035 by growing at a CAGR of ~12% over the forecast period, i.e., 2023 – 2035. Further, the market generated a revenue of ~USD 22 Billion in the year 2022. The growth of the market can be attributed to the escalating demand for air conditioners and refrigerants. As of 2020, around 6 million air conditioners were observed to be shipped across the globe. The changing climate during summer increases the hotness of the climate causing a lot of sweat and tiredness. People tend to buy coolers, air conditioners, and cooling fans to reduce this heat. The increasing disposable income of people increases the living standards of the population leading to the purchase of more air conditioners. Even software companies and IT industry companies buy air conditioners to maintain the temperature of the rooms and systems i.e., computers and CPUs. The air conditioners reduce the heat inside the room by circulating cool air.
Additionally, the global low GWP refrigerants market is further projected to grow on the back of the elimination of other refrigerants such as HFC, CFC, and HCFC. In total increment in global warming, the contribution made by CFCs and HFCs is projected to be about 11%. Furthermore, rising concern towards global warming is also anticipated to hike the growth of the market during the forecast period. As of 2020, the temperature of the earth is estimated to be approximately 1-celsius degrees warmer than in the 20th century and is further estimated to rise exponentially. Additionally, a report published by Climate.gov showed that the temperature of the earth is estimated to have spiked by a warming rate of 0.40 degrees Fahrenheit per decade summing up to 0.08 degrees Celsius since 1880. CFC and HCFC are two substances that can trap heat in the lower temperature resulting in earth warming and climate change. These substances can also destroy ozone and capture infrared radiation.
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Base Year |
2022 |
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Forecast Year |
2023-2035 |
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CAGR |
~12% |
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Base Year Market Size (2022) |
~ USD 22 Billion |
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Forecast Year Market Size (2035) |
~ USD 86 Billion |
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Regional Scope |
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Growth Drivers
Higher Utilization in the A/C System of Vehicles to Propel the Growth of the Market - As of 2021, the global sale of automobiles was noticed to be around 65 million units which are estimated to rise from approximately 60 million units in 2020. Luxurious cars are highly in demand Y-O-Y in the modern world and the air conditioning system is becoming mandatory in cars. Hence, higher demand for air conditioners in vehicles is observed in recent decades and is expected to hike the growth of the market over the forecast period.
Higher Demand in the Manufacturing of Refrigerators - It is observed that more than 190 million units of refrigerators are sold every year globally.
Escalating Investment Concerning Climate change - A report published by Climate Policy Initiative demonstrated that private climate investment around the world reached USD 310 billion from 2017 to 2018 globally.
Rising Demand for Air Conditioners for Home and Workplace - As of 2018, the global commercial air conditioner demand was projected to be around 15 million units.
Developing Cold Chain Logistics System - The value of the worldwide cold chain logistics industry amounted to approximately USD 250 billion in 2020 which is further forecasted to reach about USD 400 billion by the year 2028.
Challenges
The global low GWP refrigerants market is segmented and analyzed for demand and supply by type into fluorocarbons, hydrocarbons, and others, out of which, the hydrocarbons segment is projected to acquire a notable share in the global low GWP refrigerants market during the forecast period. the growth of the segment is ascribed to its higher utilization as a significant alternative to gas and petroleum, also known as renewable hydrocarbon biofuels. Data released by Energy Information Administration (EIA) showed that 293.83 thousand barrels of biodiesel were produced globally in 2019 while 255.50 thousand barrels were consumed worldwide in the same year. Although, hydrocarbon refrigerants must be utilized with high safety measures since they are extremely flammable in nature. The thermodynamic properties of hydrocarbon refrigerants with air-conditioning and excellent cooling systems are also estimated to drive the market segment growth in the coming years. But hydrocarbon refrigerants have a high critical temperature and are compatible with any traditional oils used for refrigerants. The high-efficiency performance of these refrigerants is driving the market growth.
The global low GWP refrigerants market is also segmented and analyzed for demand and supply by application into commercial, domestic, and industrial refrigeration. Amongst these three segments, the commercial refrigeration segment is expected to garner a significant share. The commercial use of refrigerators includes usage for storage of food, dairy products, juices, refrigerant items, frozen food, ice creams, meat, fisheries, and vegetables. The increasing production and consumption of cold storage food items across the world are estimated to boost market growth during the forecast period. The percentage of people consuming frozen food in America reached about 40% in 2020 from a base of over 30% in the year 2018 as per the records. The market growth is also attributed to the growing utilization of cold chain preservation methods in various sectors such as pharmaceutical and biopharmaceutical sectors. Commercial air conditioners are of different types including central, ductless, multi-split air conditioning, chillers, and VRF (variable refrigerant flow). These are suitable for large spaces, as they are energy efficient, easy to operate, and have no noise. The increasing economic developments in the commercial sector are estimated to rise the market growth of these air conditioners. Less pollution and minimal disruption to the occupants are the focus of manufacturers.
Our in-depth analysis of the global low GWP refrigerants market includes the following segments:
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By Purity |
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By Application |
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The European low GWP refrigerants market, amongst the market in all the other regions, is projected to hold the largest market share by the end of 2035. The growth of the market can be attributed majorly to the growing government initiatives to eliminate the utilization of HFC refrigerant and a significant number of people switching to low GWP refrigerants systems. European Economic Area stated that over 90% of Co2 was emitted due to HFCs in 2017. Moreover, skyrocketing temperature owing to global warming is further expected to influence the growth of the market positively in the region during the forecast period. In the report published by World Health Organization (WHO), in 2020, the temperature in Europe was stated to be 2.2°C higher than in the pre-industrial period.
Furthermore, the global low GWP refrigerants market is also anticipated to witness lucrative growth opportunities in the Asia Pacific region during the forecast period. The growth of the market can be ascribed to similar factors such as growing global warming and people becoming reluctant to utilize other types of refrigerants. For instance, 2020 was estimated to be the warmest year in the Asia Pacific with 1.40 degrees Celsius higher than the average temperature. All these factors are projected to propel the growth of the market in the region over the forecast period.
Honeywell International Inc. proposed acquiring US Digital Designs, Inc. This purchase is anticipated to widen the public security communications solution portfolio, enhance quality security, and raise special awareness.
Linde plc to announce a significant event of a long-term agreement for the supply of industrial gases with Mims, which is constantly working for the expansion of production capacity by 50%.
In 2023, market players might incur losses due to huge gap in currency translation followed by contracting revenues, shrinking profit margins & cost pressure on logistics and supply chain.
Controlling Inflation has become the first priority for global economies from last quarter of 2022 and to be followed in 2023. With skewed economic situations, rise in interest rate by governments to control spending and inflation, spiked oil and gas prices, high inflation, geo-political issues including U.S. & China trade war, Russia-Ukraine conflict to intensify the global economic issues.
The interest rates in the U.S. may be less sensitive in 2023 as compared to 2022; sigh of relief for businesses. Positive business sentiments, healthy business balance sheets, growth in construction spending (private construction value in 2022 stood at $1,429.2 billion, 11.7 percent (±1.0 percent) above the $1,279.5 billion spent in 2021, Residential construction in 2022 was $899.1 billion, up by 13.3 percent (±2.1 percent) from $793.7 billion in 2021, non-residential construction touched $530.1 billion, 9.1 percent (±1.0 percent) above the $485.8 billion in 2021.) showcases minimal impact of recession in the country.
Similarly, spiked spending in the European and major Asia economics including, India, China & Japan to showcase less impact on the global demand.
Ans: Rising demand for air conditioners and refrigerants and the elimination of other refrigerants such as HFC, CFC, and HCFC are the major factors driving the market growth.
Ans: The market is anticipated to attain a CAGR of ~12% over the forecast period, i.e., 2023 – 2035.
Ans: The availability of alternative refrigerants and lack of awareness of the benefits of low GWP refrigerants are estimated to be the growth hindering factors for the market expansion.
Ans: The market in the Europe region is projected to hold the largest market share by the end of 2035 and provide more business opportunities in the future.
Ans: The major players in the market are Linde plc, Airgas, Inc., Sinochem Holdings Corporation Ltd., Tazzetti S.p.A., Puyang Zhongwei Fine Chemical Co., Ltd., Harp Internation Ltd., Shandong Yuean Chemical Industry Co., Ltd., A-Gas International Limited, and others.
Ans: The company profiles are selected based on the revenues generated from the product segment, the geographical presence of the company which determines the revenue-generating capacity as well as the new products being launched into the market by the company.
Ans: The market is segmented by purity, application, and by region.
Ans: The hydrocarbons segment is anticipated to garner the largest market size by the end of 2035 and display significant growth opportunities.
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