With collective slowdown across all major segments last year, including cosmetic, the impact was inevitable on the zinc oxide market. Many zinc oxide suppliers in India experienced a significant decline in domestic consumption. Furthermore, with uncertainties looming high even in the global market, the export faced some hiccups too.
That said, not all hope is lost. Per a market research, the zinc oxide market is estimated to grow from $4.4 billion in 2019 to $5.7 billion by 2024 at a compound annual growth rate of 5.4 percent.
So, in the macro picture, the industry sure looks to be on the safer side. The demand is expected to grow strong in the APAC countries. And with India being one of the top suppliers of zinc oxide in the world, it stands tall to benefit from this trend the most.
However, for the market to match the expected forecast, a lot needs to be steered and fixed. The Indian economy, at large, should be brought back on the track with effective fiscal policies.
“The condition of the Indian economy is on a shaky ground. After witnessing the present (growth) data, just can’t be sure about it (revival of the economy in near future),” said Nobel Laureate Economist Abhijit Banerjee. He even added that the country could be going through a recession. “What I can say is that we could be in a recession. But, I don’t know by how much. There is nothing in the data that suggests we could not be in a recession.”
Former RBI Governor Raghuram Rajan echoes the same sentiment, saying “India needs significantly more growth, which means significant reforms, and I think the problem in the last 15 years or so, is the reform momentum has slowed considerably”.
A lot was expected from Budget 2020. Did it stand to deliver on all the expectations – that’s a point of debate. However, the government did make a series of announcements around infrastructural investment. Such efforts could ease off the pressure from households, which can boost the manufacturing sector. This would cascade to positively pick the demand for offerings from zinc oxide manufacturers India in the long-run. But market pundits believe that it’s a long way and a lot needs to be re-aligned and improved.
Indeed, even in the current downturn, the zinc oxide industry is trading much better vs. the other segments. That resilience, however, can simmer down if the macro-economy doesn’t have its course-correction in the coming months.
If you’re a zinc manufacturer India based, while the long-term picture looks just fine, the short-term has some challenges on the way that you have to deal with.