Gradual demand rebound expected

B&K Research forecasts a gradual but steady demand recovery in the global chemical industry during 2025. While 2024 saw modest volume growth across chemical, specialty chemical, and agrochemical segments, the improvement was limited by weak pricing, meaning companies couldn’t fully capitalize on rising volumes.

A key development supporting this cautious optimism is the end of a prolonged global inventory destocking cycle in chemicals and specialty chemicals by late 2024. With inventory normalization, companies regained clearer sales visibility and resumed YOY volume growth. However, while destocking eased, the agrochemical segment continued to grapple with excess stock, although signs of normalization appeared near year-end

Looking ahead into 2025, volume-led growth is expected to continue—but pricing headwinds will likely persist. Despite the uptick, low commodity and farm prices will constrain price recovery. Analysts at Motilal Oswal anticipate that global crop protection prices may bottom out during the year, enabling stabilization later in the cycle

This mix of volume growth on one hand and weak pricing on the other is mirrored in India. Global demand rebound—especially in specialty and agrochemicals—is poised to benefit the domestic industry, supporting production volumes in India, but not significantly boosting revenue per unit

Adding to this, strong demand in sectors like refrigeration (e.g., refrigerant gases), petrochemicals, and room air conditioning are contributing to broader volume support, although price recovery remains muted