What are the Known and Unknown Adjacency Impacting the Refrigerants Market?

The refrigerants market size is estimated to be USD 21.3 billion in 2020 and is expected to reach USD 30.8 billion by 2025, at a CAGR of 7.7% during the forecast period. Factors such as increasing demand for consumer appliances and growing cold chain markets are expected to drive the refrigerants market. The major restraint for the market will be the regulations imposed against the usage of fluorocarbons such as HCFCs and HFCs in North America and Europe. However, the increasing demand for natural refrigerants will act as an opportunity for the market.

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The key market players profiled in the report include Arkema S.A. (France), Dongyue Group Co. Ltd. (China), Honeywell International Inc. (US), The Chemours Company (US), The Linde Group (Ireland), Air Liquide (France), Sinochem Lantian Co. Ltd. (China), Daikin Industries (Japan), Mexichem (Mexico), and Asahi Glass Corporation (Japan). Players in the refrigerants market are mainly concentrating on new product launches, agreements, mergers & acquisitions, and expansions to meet the growing demand for refrigerants for various applications. New product launches help companies to strengthen their product portfolio and meet the specific demands of customers.

Market Dynamics

Driver: Growing Cold Chain Market

A cold chain is a supply chain that consists of a series of storage and distribution activities to maintain a particular temperature range. It comprises two segments – refrigerated transport that utilizes refrigerator trucks, cars, rail, and containers, among others, and surface storage that consists of refrigerated warehouses for storing perishable products. The food and pharmaceutical industries are the major end-users contributing to the increase in demand for the cold chain. 

Restraints: Stringent Regulations Against Fluorocarbon Refrigerants

Due to the severe damage that fluorocarbon refrigerants cause to the ozone layer, various governments and agencies are imposing regulations to limit their use. Several countries have agreed to phase out the use of HCFCs and HFCs by imposing limitations on their consumption through various protocols and regulations. These regulations restrict the growth of the fluorocarbon refrigerants market.
The frequent regulations imposed on certain refrigerants under the Montreal Protocol are hampering the refrigerants market. The main aim of this protocol is to minimize the damage caused to the ozone layer due to the use of refrigerant gases. Under this protocol, countries have agreed to phase out the use of ozone-depleting fluorinated refrigerant gases.

Opportunities: Increasing demand for Natural Refrigerants

The most commonly used natural refrigerants are ammonia, carbon dioxide, and HCs such as propane and isobutene. Technological advancements in cooling equipment are replacing traditional refrigerants with natural ones. This has led to an increase in the market share of natural refrigerants in applications such as air conditioning, refrigeration, and heating systems.

Challenges: Illegal trade of refrigerants

Illegal imports of refrigerants such as HFCs pose a major threat to the safety and health of users, installers, and equipment. Contaminated high GWP refrigerants can lead to explosions like in the case of Vietnam and Brazil in 2011, due to contaminated R134a. The illegal import of refrigerants calls for legal action from authorities and can impact the reputation of companies as well.