Published Date : 13 May 2022
The global petrochemical market size was estimated at US$ 498.47 billion in 2021 and is expected to reach over US$ 798.8 billion by 2030, growing at a CAGR of 5.4% from 2021 to 2030.
Any chemical made from crude oil and natural gas, as opposed to fuels and other products made from natural gas and crude oil, and used for a range of commercial uses is referred to as a petrochemical. The scope of the concept has been expanded to cover all organic compounds. In many cases, a chemical found in petrochemicals can also be derived from other sources such as vegetables and coal.
The demand for downstream products from end-user industries, as well as capacity additions in the base chemical sector, will fuel the petrochemical market growth. The petrochemical market is expanding at a rapid pace due to the rising demand from industries such as consumer goods, industrial, textile, automotive, construction, and electronics. The propylene, ethylene, and benzene are frequently utilized in packaging, plastics, and rubber.
Asia-Pacific is the largest segment for petrochemical market in terms of region. The increased domestic demand of petrochemicals as a result of the rapid expansion of end-use industries is a major driving factor for the market growth in the region. To meet the increased demand for petrochemicals, companies in the region are turning to natural gas liquids, as well as planning cost-effective ways to boost sales of petrochemical.
North America region is the fastest growing region in the petrochemical market. The petrochemical market in North America is expected to rise due to rising consumption of ethylene, particularly in the automobile industry. Furthermore, the packaged food industry’s rising demand for ethylene is expected to contribute to its demand.
Scope of the Report
|Market Size in 2021
|USD 498.47 Billion
|Revenue Forecast by 2030
|Growth Rate from 2021 to 2030
|Fastest Growing Region
|BP Plc, Exxon Mobil Corp., BASF SE, Total S.A., Sumitomo Chemical Co., Ltd., Chevron Phillips Chemical Company, Dow, China Petroleum & Chemical Corporation, DuPont de Nemours, Inc.
Surge in demand for lightweight plastics
The ethylene which is a type of petrochemical is used in the manufacturing of plastic and plastic products. The small- and large-scale cosmetic enterprises are benefitting from the increased desire for light weight plastics due to the consumer convenience. The petrochemical market will continue to rise as customers become more aware of the numerous types and forms of plastic products available in the market. The need for light weight plastic materials in the construction and automotive industries is growing. To provide consumers with better packaging options, ethylene producers are moving their focus to light weight and high-quality packaging. Thus, the surge in demand for light weight plastics is driving the growth of petrochemical market during the forecast period.
High cost of investments
The availability and cost of raw materials such as natural gas and coal, as well as capital expenses, freight costs, and government laws, all influence production costs. The petrochemical manufacturing from any carbon-based fuel is a capital-intensive process. To ensure an affordable and continuous supply for a long time, the key market players must first determine the raw material. The required time and capital investments are calculated during the research and development phase. The next stage of process also requires lot of money. As a result, the high costs of investments are impeding the growth of petrochemical market.
Economic growth in developing regions
Although significant gains in recycling and attempts to reduce single use plastics are projected, particularly in the developing regions such as Japan, South Korea, and India, these efforts will be considerably exceeded by rapidly growing plastic consumption in these regions. Another element supporting the strong overall demand growth is the difficulty in finding alternatives to petrochemical products in many applications. Thus, the economic growth in developing regions is creating lucrative opportunities for the growth of petrochemical market during the forecast period.
Margin erosion in selected chains
The margin erosion that has been observed in particular product chains is unlikely to be rectified. The chains such as phenol, terephthalic acid, and paraxylene, have shown the most erosion. The participation in these markets has grown beyond its historically small number of participants is unlikely to return to its previous state, even if the demand growth and more investment discipline among manufacturers improve the situation. Thus, the margin erosion in selected chains is huge challenge for the growth of the petrochemical market.
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