Ethylene Market is set to record a CAGR of nearly 9.9% over the period from 2021 to 2028

Market Overview

The size of the worldwide ethylene market, estimated at USD 147.2 billion in 2020, is anticipated to grow at a revenue CAGR of 9.9% over the following five years. Rising demand for polyethylene for packaging, an increase in demand for cars and electronics, and technological breakthroughs in bio-based production techniques are some of the main reasons influencing revenue growth. In the upcoming years, product demand is anticipated to increase as a result of changing consumer lifestyles and rising need for packaged goods.

The product is also used to create unsaturated polyester resins, polyurethanes, solvents, antifreeze, and other items, as well as to sterilise medical and surgical equipment and supplies. Due to its high tensile strength and puncture resistance, linear low-density polyethylene (LLDPE) is increasingly in demand in industries such as food and pharmaceutical packaging, which is expected to stimulate global revenue growth.

Ethylene is a flammable, colourless gas that is produced by petrochemicals and is frequently utilised as a raw material for the production of plastics, textiles, and other organic compounds. It is a diversified portfolio of commonly used petrochemicals, and consumer demand is affected by both energy and economic cycles. It is transformed into more chemicals, which are transformed into additional household goods and other things.

Polyethylene, ethylene oxide, ethylene dichloride, and styrene are a few examples of ethylene derivatives and the uses for them. The largest proportion of ethylene consumed will be used in the synthesis of polyethylene, followed by ethylene oxide and ethylene dichloride. Additionally, it functions in plants as a hormone that promotes the ripening of fruit, the opening of flowers, and the abscission of leaves. Catalytic generators are used in commercial ripening rooms to convert ethanol to ethylene.

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Rising polyethylene demand is a market driver.

Increasing consumer acceptance of packaged products as a result of shifting consumer lifestyles is anticipated to increase product demand throughout the forecast period. Polyethylene is used in a variety of products, such as sheets, bottles used for packing, and tubing. The expanding use of plastic containers across a range of end-use sectors is anticipated to dramatically enhance product demand.

Growing polyethylene consumption and demand in the food and beverage sector will fuel global revenue growth. The reason why food and beverages are preserved from both internal and exterior surroundings is because of its excellent moisture barrier characteristic. The manufacturers’ increased emphasis on packaging that prevents quality loss and food contamination is anticipated to create sizable growth prospects for the polyethylene market.

Restraint: The existence of strict laws

Implementation of strict government rules pertaining to ethylene production and consumption is the main factor limiting market growth. Strict limitations on ethylene usage are anticipated to have an influence on market revenue growth because it is flammable and carcinogenic. Additionally, a number of nations are putting environmental protection laws into effect, which will probably put pressure on the businesses producing hydrocarbon-based gas. For instance, the Ethylene Oxide (EtO) derivative of ethylene is a contemporary example of strict restriction.

A colourless, combustible gas with a slight ether-like smell is called ethylene oxide (EtO). The principal application for the gas is as a chemical intermediary in the production of ethylene glycol (antifreeze), textiles, polyurethane foam, solvents, detergents, medicines, adhesives, and other goods. EtO is governed by the US Environmental Protection Agency (EPA) as a hazardous air pollutant.

Input Outlook:

The global market has been divided into coal, natural gas, and hydrocarbon steam cracking, depending on the source. Throughout the projected period, the natural gas segment is anticipated to post a considerably faster revenue CAGR.

The adoption of new extraction techniques, such as horizontal drilling and hydraulic fracturing, has led to easier extraction of natural gas, also known as shale gas, trapped in low permeability rock formations. As a result, natural gas availability has increased significantly over the past few years. Natural gas is now one of the main energy and feedstock sources on the market as a result of price reductions brought about by its abundance.

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