Ethylene is an important organic chemical that serves as a building block for producing a wide range of plastics and industrial chemicals. It is used to manufacture polyethylene, which is used to make plastic films, coatings, bottles, containers and pipes. In the agricultural industry, ethylene plays an important role in fruit ripening and flower development. The ripening process of fruits, such as bananas, tomatoes and kiwis, involves ethylene gas which signals the fruit to change its color and texture. Flowers scientists also use controlled ethylene exposure to regulate bloom times, improve foliage quality and develop disease resistance in plants. The global demand for fruits and flowers is growing rapidly with rising incomes and changing consumption patterns around the world. This is expected to significantly drive the ethylene market.
The global ethylene market is estimated to be valued at US$ 137.2 Bn in 2023 and is expected to exhibit a CAGR of 9.5% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Ethylene production is influenced by two major drivers – the rising demand from the agricultural industry and increasing plastic consumption. The increasing population is leading to higher demand for food, which is raising the global production of fruits and flowers substantially. As ethylene plays a crucial role in fruit ripening and flower development, its demand from the agricultural sector is surging rapidly. Additionally, with rising incomes, changing lifestyles and growing plastic packaging needs from various end-use industries like consumer goods, healthcare and FMCG; the global plastic production is being bolstered strongly. This is positively impacting the consumption of ethylene, which is a key petrochemical used to manufacture polyethylene and various polymers. While these drivers are expected to push the market forwards in the coming years, environmental regulations regarding plastic waste may create certain challenges for market players.
The global ethylene market is dominated by the polyethylene segment which holds around 65% share of the overall market. Polyethylene finds wide applications in plastic products such as containers, packages, automotive parts, consumer goods among others. It is cheaper to produce as compared to other petrochemical derivatives of ethylene such as ethylene oxide and ethylene dichloride. The properties of polyethylene such as durability, flexibility and resistance to moisture makes it ideal for packaging applications. This in turn is driving the demand for polyethylene and its dominance in the global ethylene market.
Political: The government policies and regulations related to environmental pollution are influencing the ethylene market. Stricter norms to curb emission from petrochemical units may impact production volumes.
Economic: The global economic growth positively impacts the demand for ethylene and its derivatives from end-use industries. Volatility in crude oil prices which is the key raw material affects the production costs of ethylene.
Social: Growing population and rising disposable income is propelling the demand for packaged consumer goods driving ethylene consumption. Awareness about plastic waste management and reuse is also rising.
Technological: Advancements in petrochemical production technologies has enhanced energy efficiency during ethylene production. Development of bio-based ethylene is also an emerging trend.
Global Ethylene Market Size is expected to witness high growth over the forecast period 2023 to 2030.
Regional analysis: Asia Pacific accounts for around 50% share of the global ethylene market led by China. This can be attributed to the presence of large petrochemical facilities and consumption from downstream plastic industries in the country. China exports significant volumes of ethylene to other Asian nations as well.
Key players: Key players operating in the global ethylene market are Honeywell International Inc., Littelfuse, Inc., Molex Incorporated, RMCIP, Standex Electronics, Inc., Nippon Aleph, HSI Sensing, Inc., Coto Technology USA, PIT-RADWAR S.A., PIC GmbH, STG Germany GmbH, Harbin Electric Group, Zhejiang Xurui, Zippy Technology Corp.
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it