Phenol Procurement Intelligence Report 2025-2030

Phenol Supply-Demand Overview

Asia-Pacific is one of leading regions for the phenol procurement market, driven by major manufacturing hubs like China and India, which dominate the production of plastics, automotive parts, and electronics equipment. In 2023, global automotive production reached nearly 94 million units in 2023, an increase of about 10% over 2022. The Asia-Pacific region is the world's largest automobile producer, with its production volume rising from over 46 million units in 2021 to over 55 million-units in 2023. 

As per the phenol procurement report, in North America, the demand for phenol sourcing is driven by the chemical and automotive industries, particularly for BPA production. Europe also experiences significant consumption, especially in the automotive and construction category. Europe's automobile production expanded from around 16 million units 3 years ago to over 18 million units in 2023, representing a 13% year-over-year increase.

Phenol Cost Structure

As per the phenol procurement report, the cost modeling is largely determined by the prices of raw materials, particularly benzene, which makes up a substantial portion of production costs. Benzene is typically sourced from crude oil, so changes in oil prices directly affect phenol pricing strategies. Other raw materials, such as propylene, also contribute to the overall cost, although to a lesser extent. Furthermore, the energy-intensive process of phenol sourcing adds an additional element to the cost structure.

In accordance with the phenol procurement report, apart from raw materials and energy, operational costs such as labour, maintenance, and logistics also play a role in the overall pricing trends. Environmental regulations and compliance costs can further increase the price of the chemical, particularly for producers who need to implement advanced equipment to meet sustainability standards. 

In the procurement market the transportation and distribution costs impact strategic purchasing, as it is frequently shipped across regions and countries, introducing complexities into global supply chains.

Phenol Pricing Trends

As per the phenol procurement report, the market is mainly driven by a mix of raw material costs, supply and demand dynamics, and global economic factors. The key raw materials for its production are benzene and propylene, and fluctuations in their prices can significantly impact its costs. Additionally, the demand for it from downstream industries, such as plastics, resins, and chemicals, plays a crucial role in pricing models. 

The phenol procurement report suggests that supply chain disruptions, such as those caused by natural disasters, geopolitical tensions, or shifts in production capacity, can lead to short-term price hikes and impact category management. Economic conditions, energy prices, and regulatory changes (such as environmental legislation) also influence production costs, thereby shaping negotiation strategies.

Phenol Procurement Best Practices

Phenol sourcing practices typically involve sourcing the chemical from established suppliers, often through long-term contracts or spot purchases, depending on the buyers needs. Companies aim to secure reliable, cost-effective supply by negotiating favorable terms for price, delivery, and quality. As per the phenol procurement report, suppliers are usually large-scale petrochemical companies or specialized chemical producers with consistent production capacity and adherence to regulatory standards.

Procurement research teams often assess suppliers based on several factors, including product quality, delivery reliability, and compliance with environmental and safety regulations. According to the phenol procurement report, due to the volatility in raw material prices (such as benzene), procurement best practices also involve strategic risk management, which can include hedging against price fluctuations or diversifying suppliers to ensure stability in this category.

Key Players in the Phenol Industry

Recent Developments in the Phenol Industry

• In June 2024, Neste, Borealis, and Covestro signed an agreement to recycle discarded tires into high-quality plastics for automotive use. Neste will convert the tires into a raw material for polymers, which Borealis will process into it and acetone. As per the phenol procurement report, Covestro will use these chemicals to produce polycarbonate. 
• In December 2023, INEOS Phenol started production at Europe’s largest Cumene facility in Marl, Germany. The cumene produced is an essential raw material for the production of phenol used in healthcare and cleaning products. 
• In April 2022, Cepsa Quimica SA started producing a sustainable grade of chemical, used in engineering resins. In accordance with the phenol procurement report, the Madrid-based company is marketing this new material under the NextPhenol brand, which can be used to produce nylon, polycarbonate, methyl methacrylate, and coatings.