Phosphoric Acid Market Size, Share, and Trends 2024 to 2034

The global phosphoric acid market size was valued at USD 47.6 billion in 2022, and it is expected to hit around USD 74.27 billion by 2032, growing at a CAGR of 4.6% during the forecast period from 2023 to 2032.

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Key Takeaways

• Asia-Pacific has held the largest revenue share of 38% in 2022.
• Europe is estimated to observe the fastest expansion.
• By Process Type, the thermal process segment generated over 66% of revenue share in 2022.
• By Process Type, the wet process segment is anticipated to grow at a remarkable CAGR of 6.8% during the projected period.
• By Application, the fertilizer segment contributed the highest market share of 44% in 2022.
• By Application, the water treatment segment is expected to expand at the fastest CAGR over the projected period.

Phosphoric Acid Market in the Asia Pacific 2023-2032

The Asia Pacific phosphoric acid market size accounted for USD 18.09 billion in 2022 and is estimated to reach around USD 28.49 billion by 2032, growing at a CAGR of 4.7% from 2023 to 2032.

Asia-Pacific has held the largest revenue share of 38% in 2022. In the Asia-Pacific region, the phosphoric acid market is witnessing notable trends. The agricultural sector remains a key driver due to increasing food demand, leading to higher fertilizer production and phosphoric acid consumption. Additionally, the food and beverage industry's growth, driven by changing consumer preferences and urbanization, contributes to rising demand for food-grade phosphoric acid. Furthermore, the region's expanding industrial and manufacturing activities, especially in emerging economies, further boost the market. Sustainable production practices and technological advancements are also gaining prominence as Asia-Pacific aims to align with global environmental standards.

Europe is estimated to observe the fastest expansion. In Europe, the phosphoric acid market is marked by several trends. The region is experiencing a growing demand for sustainable and eco-friendly production methods, aligning with stringent environmental regulations. Additionally, the food and beverage industry is steadily increasing its usage of phosphoric acid as an acidity regulator and flavor enhancer in various products. As sustainability and food quality become paramount, Europe's phosphoric acid market is witnessing a shift towards cleaner production methods and a surge in applications in the food sector.

Moreover, in North America, the phosphoric acid market is characterized by several prominent trends. This emphasis is driven by both regulatory pressures and consumers' preferences for eco-friendly products. Furthermore, the region's food and beverage industry is actively exploring innovative applications for phosphoric acid, notably as an acidity regulator and flavor enhancer across a diverse spectrum of products. These trends reflect a concerted effort in North America to align with environmental standards and cater to evolving consumer demands in the food sector.

The market also benefits from advancements in production technologies, which enhance efficiency and reduce environmental impacts. Overall, North America's phosphoric acid market reflects a dynamic landscape responding to evolving industry and consumer demands.

Phosphoric Acid Market Overview

• The phosphoric acid market revolves around the manufacturing and distribution of phosphoric acid, an essential inorganic chemical compound widely applied in diverse industrial sectors. Its primary uses include serving as a vital component in fertilizer production, food and beverage additives, detergents, and as a corrosion inhibitor in the automotive industry.
• This market's essence lies in supplying phosphoric acid as a fundamental ingredient for numerous industrial applications and processes across various sectors. Market dynamics are influenced by factors such as agriculture demands, food and beverage production, and industrial manufacturing needs.
• The market's nature is characterized by its widespread use in diverse sectors, where phosphoric acid serves as a crucial component for various chemical processes and applications.

Growth Factors

• The phosphoric acid market centers on the production and distribution of phosphoric acid, a versatile inorganic compound widely used across various industrial applications. It serves as a critical ingredient in fertilizer production, food and beverage additives, and detergents, and functions as a rust inhibitor in the automotive industry. This market's significance lies in supplying a fundamental component essential for various chemical processes and industrial applications.
• Several key trends and growth drivers shape the phosphoric acid industry. Firstly, the agriculture sector's continuous demand for fertilizers fuels the market, driven by global food security concerns. Secondly, the food and beverage industry rely on phosphoric acid as an acidity regulator and flavor enhancer, contributing to its growth. Thirdly, the detergents and cleaning products segment benefits from its use as a cleaning agent, especially in household and industrial applications. Moreover, the automotive industry's need for rust inhibitors adds to phosphoric acid's market demand, driven by the growth of the automotive sector.
• Multiple factors propel growth in the phosphoric acid market. The global population's increasing food consumption necessitates higher agricultural yields, driving fertilizer demand. Additionally, rising awareness of food quality and safety encourages the use of food-grade phosphoric acid in the food industry. Moreover, expanding industrial and manufacturing activities boost the demand for cleaning products and rust inhibitors containing phosphoric acid.
• Furthermore, the market benefits from innovations in phosphoric acid production processes that enhance efficiency and reduce environmental impacts. Challenges in the Phosphoric Acid Market include environmental concerns related to phosphorus runoff and water pollution. Regulatory pressures and sustainability initiatives drive the need for eco-friendly production methods. Market players must also contend with price fluctuations in raw materials, impacting production costs and pricing. However, these challenges create opportunities for businesses to invest in sustainable and efficient phosphoric acid production methods, aligning with environmental regulations.
• Exploring new applications, such as phosphoric acid in batteries or as a source of renewable energy, can open doors to diversification and growth. Additionally, expanding into emerging markets with rising industrial and agricultural activities presents opportunities for market expansion.

Phosphoric Acid Market Scope

Phosphoric Acid Market Dynamics

Driver

Agricultural, food and beverage industry demand

Agricultural demand propels market demand in the phosphoric acid market as phosphoric acid plays a critical role in fertilizer production. With the world's growing population and the need to enhance agricultural yields, there is an escalating demand for efficient fertilizers containing phosphoric acid. This compound provides essential phosphorus to crops, ensuring optimal growth and yields. As global food security concerns persist, the agricultural sector's consistent reliance on phosphoric acid for fertilizer production continues to drive robust demand in the market. Moreover, the phosphoric acid market experiences a surge in demand due to the food and beverage industry's requirements.

Phosphoric acid serves as a crucial acidity regulator and flavor enhancer in various products, including carbonated beverages and processed foods. As consumer preferences for such products continue to rise globally, the need for phosphoric acid in food and beverage manufacturing grows substantially. This industry-driven demand underscores phosphoric acid's pivotal role in ensuring the desired taste and quality of a wide range of food and drink items, propelling market growth.

Restraints

Environmental concerns and safety regulations

Environmental concerns pose a restraint on the phosphoric acid industry by raising alarm over phosphorus runoff from agricultural applications. This runoff can lead to water pollution, ecosystem disruptions, and adverse environmental impacts. In response, regulators enforce stringent restrictions on the use of phosphoric acid. Concerns about its ecological footprint and potential harm to aquatic systems have heightened, creating challenges for the market as it strives to adopt more environmentally responsible production practices and mitigate its impact, which can lead to increased compliance costs and limited usage in certain regions.

Moreover, health and safety regulations serve as a restraint on the phosphoric acid market by imposing strict compliance requirements on the handling, transportation, and storage of phosphoric acid. These regulations are aimed at ensuring worker safety and preventing potential hazards associated with the chemical. Complying with these stringent standards can result in increased operational costs for manufacturers, necessitating the implementation of robust safety measures and training programs. The complexity of adhering to such regulations can pose logistical challenges and additional expenses, impacting the overall market demand and profitability.

Opportunities

Sustainable production and advanced technologies

Sustainable production practices drive market demand in the phosphoric acid market as environmental consciousness rises. Consumers and regulators increasingly favor eco-friendly and responsible production methods. Companies adopting sustainable techniques not only mitigate environmental concerns related to phosphoric acid production but also meet the growing demand for greener chemicals. This commitment to sustainability enhances the market's reputation, attracts environmentally-conscious consumers, and ensures compliance with evolving environmental regulations, ultimately boosting demand for phosphoric acid produced through eco-friendly processes.

Moreover, advanced technologies surge the demand in the phosphoric acid market by enhancing production processes. Innovations, such as more efficient extraction methods and automation, increase production capacity, reduce energy consumption, and improve cost-effectiveness. These technologies enable manufacturers to meet growing demand while maintaining competitive pricing. Moreover, advanced methods address environmental concerns, aligning with sustainability expectations. As the market embraces cutting-edge technologies, it gains efficiency, cost savings, and environmental benefits, driving increased demand for phosphoric acid across various industries.

Impact of COVID-19:

The phosphoric acid market experienced mixed effects due to the COVID-19 pandemic. In the early stages, the market faced disruptions in supply chains, as lockdowns and travel restrictions hampered the transportation of raw materials and finished products. These challenges temporarily impacted production and distribution, causing delays. However, as the pandemic progressed, certain aspects of the market saw shifts in demand.

The agricultural sector, which relies heavily on phosphoric acid for fertilizer production, remained resilient as governments prioritized food security. Increased home gardening and agricultural activities by individuals during lockdowns also boosted demand. Conversely, segments related to the food and beverage industry, such as the production of carbonated beverages and processed foods, saw a decline in demand due to restaurant closures and changes in consumer behavior. This resulted in reduced consumption of phosphoric acid in these applications. Overall, the phosphoric acid market demonstrated adaptability, with demand shifts influenced by changing consumer needs and economic conditions during the pandemic.

Process Type Insights

According to the Process type, the thermal process segment has held 66 % revenue share in 2022. The thermal process in the phosphoric acid market refers to a manufacturing method where phosphate rock is subjected to high-temperature treatment, typically via combustion or smelting processes. This results in the production of phosphoric acid. Trends in the thermal process segment of the phosphoric acid market include a focus on improving energy efficiency and reducing environmental impact.

Manufacturers are investing in advanced technologies and cleaner combustion methods to enhance production sustainability. Additionally, efforts are being made to maximize phosphate rock utilization and minimize waste in the thermal process, aligning with the industry's growing emphasis on eco-friendly and resource-efficient production techniques.

The Wet Process is anticipated to expand at a significantly CAGR of 6.8% during the projected period. The wet process is a conventional method of producing phosphoric acid, involving the reaction of phosphate rock with sulfuric acid. This process yields a high-purity phosphoric acid suitable for various industrial applications, particularly in the production of fertilizers and food additives.

In the phosphoric acid market, the wet process remains a dominant production method due to its reliability and high-quality output. However, the industry is witnessing a trend toward adopting more sustainable practices and improving energy efficiency within the wet process to reduce environmental impacts and operating costs. These efforts align with the growing emphasis on sustainability and environmental responsibility in the chemical manufacturing sector.

Application Insights

By application, the fertilizer segment held the largest market share of 44% in 2022. Within the phosphoric acid market, a prominent application area is fertilizers. These substances enhance soil fertility by supplying crucial nutrients to plants, with phosphoric acid being a pivotal ingredient. A significant trend in this sector is the escalating global need for fertilizers to enhance agricultural yields and ensure food security. Furthermore, there's a rising focus on environmentally friendly and sustainable fertilizers, spurring innovations in phosphoric acid-based fertilizer formulations. These innovations aim to reduce environmental footprints while maximizing crop productivity, in line with the broader sustainability objectives within modern agriculture.

On the other hand, the water treatment segment is projected to grow at the fastest rate over the projected period. Water treatment in the phosphoric acid market refers to the application of phosphoric acid as a corrosion inhibitor and pH adjuster in processes aimed at purifying and conditioning water for various industrial and municipal purposes. Trends in this segment include a growing emphasis on sustainable and environmentally friendly water treatment methods, which drive the demand for eco-friendly phosphoric acid formulations. Additionally, the increasing need for effective corrosion control in water systems and infrastructure maintenance further propels the utilization of phosphoric acid in water treatment processes.

Recent Developments

• In 2021, ICL successfully acquired Fertiláqua, aiming to utilize its robust market presence and distribution capabilities to boost sales of organic and controlled-release fertilizers and specialty plant nutrition products in Brazil, a rapidly growing agricultural market.
• In 2020, OCP Group, in collaboration with German and Belgian partners Budenheim and Prayon, initiated the construction of a new purified phosphoric acid plant in Morocco. This strategic project aims to bolster phosphoric acid production and meet growing market demands.
• In 2018, The Agrium merge with PotashCorp resulting in the formation of Nutrien.The  Nutrien boasts the industry's largest crop nutrient production portfolio and an extensive global retail distribution network comprising over 1,500 farm retail centers.
• In 2016, The Mosaic Company acquired Vale Fertilizantes, the fertilizer division of Vale S.A., which included phosphate assets and phosphoric acid production facilities. This acquisition expanded Mosaic's presence in the phosphoric acid market.

Phosphoric Acid Market Players

• The Mosaic Company
• OCP Group
• Innophos Holdings, Inc.
• Nutrien Ltd.
• Israel Chemicals Ltd.
• Prayon Group
• Solvay S.A.
• EuroChem Group AG
• PotashCorp (Potash Corporation of Saskatchewan Inc.)
• Jordan Phosphate Mines Company PLC
• Chemische Fabrik Budenheim KG
• Wengfu Group
• Yuntianhua Group Co., Ltd.
• Reade Advanced Materials

Segments Covered in the Report

By Process Type

• Wet Process
• Thermal Process

By Application

• Fertilizers
• Feed and Food Additives
• Detergents
• Water Treatment Chemicals
• Metal Treatments
• Others

By Geography

• North America
• Europe
• Asia-Pacific
• Latin America
• Middle East and Africa