Ethylene Market: Information by End-User (Automotive, Packaging, Healthcare), Application (Polyethylene (PE), Polyethylene Terephthalate (PET)), Raw-Material, and Region — Forecast till 2029

Apr 17, 2020   Global Statistics Representing Ethylene Market Scenario Ethylene is a widely used organic compound for the manufacturing of polyethylene and polyvinyl chloride (PVC). The extensive use of polyethylene in the production of the packaging industry is accelerating the ethylene market growth. The usage of ethylene releasing compounds into an appropriate storage environment, which facilitates faster, effective, and uniform ripening of fruits and vegetables, is driving the market growth. The United N...
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Global Statistics Representing Ethylene Market Scenario

Ethylene is a widely used organic compound for the manufacturing of polyethylene and polyvinyl chloride (PVC). The extensive use of polyethylene in the production of the packaging industry is accelerating the ethylene market growth. The usage of ethylene releasing compounds into an appropriate storage environment, which facilitates faster, effective, and uniform ripening of fruits and vegetables, is driving the market growth.

The United Nations (UN) has estimated the world population to reach 8.5 billion by 2030. Thus, rising demand for food products across the globe is subsequently driving the demand for ethylene in the food & beverage industry. Ethylene is also used in the healthcare industry as an anesthetic, whereas in the rubber and plastic industry it is used for extracting rubber.

Application of Ethylene in the Agricultural, and the Food and Beverage Industry

The quality of agriculture production relies on the growth of plants under different environmental conditions. Increasing environmental pollution and changing climatic conditions hampers the agriculture productivity. The U.S. and China are the significant contributors in agriculture production, followed by Brazil, whose agricultural production contributes about 4.36% to the country’s GDP. The below info-graph depicts the GDP share of agriculture in Brazil in 2018.

Brazil-gdp-Share-of-agriculture

The fluctuating rate of agricultural production can be minimized with the applications of ethylene in the food industry. Ethylene is regarded as a multifunctional growth regulator and is extensively used for the development of leaves, flowers, and fruits. The availability of synthetic chemical compounds of ethylene in liquid solution propels the market growth.

Low-Density Polyethylene’s Application in the Packaging Industry to Drive the Market Growth

The ethylene market’s most prominent driver is the rising production of polyethylene across the globe. The widespread use of low-density polyethylene in the packaging industry provides an impetus to market growth. The burgeoning working population is subsequently boosting the demand for packaged food and beverages. As per the Statistics by OEC, in 2017, the export value of packaged medicaments from Europe reached about USD 50,600 million. The use of high-density polyethylene for the manufacturing of trays, bottles for fruit juices and milk, and industrial bulk containers, drives the market growth.

Ethylene Market: Segmentation

Low Natural Gas Prices to Drive its Consumption Rate Globally

By raw material, the ethylene market is segmented into naphtha and natural gas. The natural gas segment dominates the ethylene market. Ethylene is produced using two raw materials, naphtha and natural gas. In Europe and Asia, ethylene is primarily produced using feedstock naphtha, whereas in the U.S., the Middle East, and Canada, it is produced using natural gas. As stated by the U.S. Energy Information Administration (EIA), the prices of natural gas witnessed a considerable decline in 2019, which was about USD 2.57 per million British thermal units (MMBtu). Thus, lower prices of natural gas are subsequently driving its consumption globally, further driving the segment growth.

The Polyethylene Segment to Grow at a Significant Rate

Ethylene derivatives and ethylene by-products have a huge demand in the market as these chemicals are used across various industries. In addition to the usage of ethylene at a large scale during the manufacturing process of polyethylene, it is also used in higher quantity to produce ethylene glycol. Ethylene glycol is used to manufacture synthetic textile fibers like spandex and polyester which are extensively used for sports apparel such as swimming suit, jersey and more. Along with a huge demand for sports apparel in recent times, global textile and apparel exports reached USD 315,000 million and USD 505,000 million in 2018, with a rise of 6.4% and 11%, respectively. These data were published by the World Trade Organisation in their latest statistical review. Growing demand from end-use industries will support the steady growth of the ethylene industry in the coming years.

The below graph depicts the country-wise share of textile and clothing exports for the year 2018.

world-2018-export-partener-shareRegional Overview

South Korea to be at the Forefront of Asia-Pacific’s Ethylene Market

Asia-Pacific dominates the ethylene market and is expected to continue the same during the forecast period.  The region is backed by the presence of leading players that are heavily investing in order to enhance their production capacities. Additionally, steam cracker units in the region require low maintenance compared to other units. In Japan, about four steam cracker units were shut down for maintenance in 2019, whereas in 2018, about seven steam cracker units were shut down. In South Korea, LG Chem and Hanwha Total established new manufacturing facilities in 2019, which are slated to increase the country’s ethylene production rate by 8.7%, i.e., 9.74 million metric tons/year. The below info-graph depicts the top ethylene producers for the year 2017.

top-ethylene-producer-by-regionAsia accounted for about 55% of the ethylene exports in 2017, where South Korea held about 25% of the share with an export value of around USD 1 billion. The region is also backed by the presence of the largest petrochemical initiative — Refinery and Petrochemical Integrated Development (RAPID) project. The project will provide feedstock for the integrated petrochemicals with a capacity of 3.3 million metric tons per year, thereby boosting the regional market growth.

Key Players

  • SABIC
  • The Dow Company
  • Exxon Mobil Corporation
  • Royal Dutch Shell
  • China Petroleum & Chemical Corporation
  • Chevron Phillips Chemical Company
  • Total S.A.
  • LyondellBasell Industries Holdings B.V.
  • China National Petroleum Corporation
  • Repsol
  • BASF SE
  • Westlake Chemical Corporation
  • Sasol
  • Mitsubishi Chemical Corporation
  • Nova Chemicals Corporation

Recent Developments

  • On March 28, 2017, The Dow Chemical Company announced its new, world-scale ethylene production facility in Freeport, Texas, with a capacity of 1.5 million metric tons
  • On September 17, 2019, Hanwha Total Petrochemical invested about USD 450 million to expand its new ethylene production capacities to produce around 1.4 million tons of ethylene per year, an increase of 30%.
  • In 2018, BASF SE established an ethylene oxide plant in Antwerp and Ludwigshafen with a combined capacity of 845,000 metric tons per year
  • In 2017, Hanwha Total Petrochemical established a new production facility with a production capacity of about 600,000 tons, making it the world‘s top company for EVA production

Ethylene Market Segmentation

By End-User

  • Automotive
  • Packaging
  • Healthcare
  • Textile
  • Agrochemical
  • Building & construction

By Application

  • Polyethylene (PE)
  • Polyethylene terephthalate (PET)
  • Polyvinyl chloride (PVC)
  • Polystyrene (PS)
  • Fibers & other organic chemicals

By Raw-Material

  • Naphtha
  • Natural gas

By Region

  • North America
  • Europe
  • Asia-Pacific
  • South America
  • The Middle-East and Africa

Global Statistics Representing Ethylene Market Scenario

Ethylene is a widely used organic compound for the manufacturing of polyethylene and polyvinyl chloride (PVC). The extensive use of polyethylene in the production of the packaging industry is accelerating the ethylene market growth. The usage of ethylene releasing compounds into an appropriate storage environment, which facilitates faster, effective, and uniform ripening of fruits and vegetables, is driving the market growth.

The United Nations (UN) has estimated the world population to reach 8.5 billion by 2030. Thus, rising demand for food products across the globe is subsequently driving the demand for ethylene in the food & beverage industry. Ethylene is also used in the healthcare industry as an anesthetic, whereas in the rubber and plastic industry it is used for extracting rubber.

Application of Ethylene in the Agricultural, and the Food and Beverage Industry

The quality of agriculture production relies on the growth of plants under different environmental conditions. Increasing environmental pollution and changing climatic conditions hampers the agriculture productivity. The U.S. and China are the significant contributors in agriculture production, followed by Brazil, whose agricultural production contributes about 4.36% to the country’s GDP. The below info-graph depicts the GDP share of agriculture in Brazil in 2018.

Brazil-gdp-Share-of-agriculture

The fluctuating rate of agricultural production can be minimized with the applications of ethylene in the food industry. Ethylene is regarded as a multifunctional growth regulator and is extensively used for the development of leaves, flowers, and fruits. The availability of synthetic chemical compounds of ethylene in liquid solution propels the market growth.

Low-Density Polyethylene’s Application in the Packaging Industry to Drive the Market Growth

The ethylene market’s most prominent driver is the rising production of polyethylene across the globe. The widespread use of low-density polyethylene in the packaging industry provides an impetus to market growth. The burgeoning working population is subsequently boosting the demand for packaged food and beverages. As per the Statistics by OEC, in 2017, the export value of packaged medicaments from Europe reached about USD 50,600 million. The use of high-density polyethylene for the manufacturing of trays, bottles for fruit juices and milk, and industrial bulk containers, drives the market growth.

Ethylene Market: Segmentation

Low Natural Gas Prices to Drive its Consumption Rate Globally

By raw material, the ethylene market is segmented into naphtha and natural gas. The natural gas segment dominates the ethylene market. Ethylene is produced using two raw materials, naphtha and natural gas. In Europe and Asia, ethylene is primarily produced using feedstock naphtha, whereas in the U.S., the Middle East, and Canada, it is produced using natural gas. As stated by the U.S. Energy Information Administration (EIA), the prices of natural gas witnessed a considerable decline in 2019, which was about USD 2.57 per million British thermal units (MMBtu). Thus, lower prices of natural gas are subsequently driving its consumption globally, further driving the segment growth.

The Polyethylene Segment to Grow at a Significant Rate

Ethylene derivatives and ethylene by-products have a huge demand in the market as these chemicals are used across various industries. In addition to the usage of ethylene at a large scale during the manufacturing process of polyethylene, it is also used in higher quantity to produce ethylene glycol. Ethylene glycol is used to manufacture synthetic textile fibers like spandex and polyester which are extensively used for sports apparel such as swimming suit, jersey and more. Along with a huge demand for sports apparel in recent times, global textile and apparel exports reached USD 315,000 million and USD 505,000 million in 2018, with a rise of 6.4% and 11%, respectively. These data were published by the World Trade Organisation in their latest statistical review. Growing demand from end-use industries will support the steady growth of the ethylene industry in the coming years.

The below graph depicts the country-wise share of textile and clothing exports for the year 2018.

world-2018-export-partener-shareRegional Overview

South Korea to be at the Forefront of Asia-Pacific’s Ethylene Market

Asia-Pacific dominates the ethylene market and is expected to continue the same during the forecast period.  The region is backed by the presence of leading players that are heavily investing in order to enhance their production capacities. Additionally, steam cracker units in the region require low maintenance compared to other units. In Japan, about four steam cracker units were shut down for maintenance in 2019, whereas in 2018, about seven steam cracker units were shut down. In South Korea, LG Chem and Hanwha Total established new manufacturing facilities in 2019, which are slated to increase the country’s ethylene production rate by 8.7%, i.e., 9.74 million metric tons/year. The below info-graph depicts the top ethylene producers for the year 2017.

top-ethylene-producer-by-regionAsia accounted for about 55% of the ethylene exports in 2017, where South Korea held about 25% of the share with an export value of around USD 1 billion. The region is also backed by the presence of the largest petrochemical initiative — Refinery and Petrochemical Integrated Development (RAPID) project. The project will provide feedstock for the integrated petrochemicals with a capacity of 3.3 million metric tons per year, thereby boosting the regional market growth.

Key Players

  • SABIC
  • The Dow Company
  • Exxon Mobil Corporation
  • Royal Dutch Shell
  • China Petroleum & Chemical Corporation
  • Chevron Phillips Chemical Company
  • Total S.A.
  • LyondellBasell Industries Holdings B.V.
  • China National Petroleum Corporation
  • Repsol
  • BASF SE
  • Westlake Chemical Corporation
  • Sasol
  • Mitsubishi Chemical Corporation
  • Nova Chemicals Corporation

Recent Developments

  • On March 28, 2017, The Dow Chemical Company announced its new, world-scale ethylene production facility in Freeport, Texas, with a capacity of 1.5 million metric tons
  • On September 17, 2019, Hanwha Total Petrochemical invested about USD 450 million to expand its new ethylene production capacities to produce around 1.4 million tons of ethylene per year, an increase of 30%.
  • In 2018, BASF SE established an ethylene oxide plant in Antwerp and Ludwigshafen with a combined capacity of 845,000 metric tons per year
  • In 2017, Hanwha Total Petrochemical established a new production facility with a production capacity of about 600,000 tons, making it the world‘s top company for EVA production

Ethylene Market Segmentation

By End-User

  • Automotive
  • Packaging
  • Healthcare
  • Textile
  • Agrochemical
  • Building & construction

By Application

  • Polyethylene (PE)
  • Polyethylene terephthalate (PET)
  • Polyvinyl chloride (PVC)
  • Polystyrene (PS)
  • Fibers & other organic chemicals

By Raw-Material

  • Naphtha
  • Natural gas

By Region

  • North America
  • Europe
  • Asia-Pacific
  • South America
  • The Middle-East and Africa