Global Ethylene Market is Estimated to Witness High Growth Owing to Opportunity in Plastic Industry

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Global Ethylene Market is Estimated to Witness High Growth Owing to Opportunity in Plastic Industry
Ethylene Market

Ethylene is an important petrochemical used as a raw material in the production of polyethylene, ethylene glycol, ethylene oxide, and polyvinyl chloride (PVC). It is widely utilized in the manufacturing of plastics, fibers, and packaging materials. The increasing demand for plastics from the packaging, automotive, construction industries is fueling the growth of the global ethylene market. The plastic industry uses ethylene as a feedstock to manufacture various plastics including polyethylene, polyvinyl chloride, and ethylene-vinyl acetate.

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.

Market Opportunity

The growing plastics industry presents a huge market opportunity for ethylene producers. Plastics have wide applications across industries such as packaging, construction, automotive, consumer goods, among others. According to industry estimates, the global plastic production volumes are expected to witness significant growth over the forecast period. The increasing plastic demand from emerging economies of Asia Pacific and Latin America is anticipated to boost the consumption of ethylene in the region. Further, development of bio-based and recycled plastics using ethylene as a raw material offers sustainable growth opportunities for market players.

Porter's Analysis
Threat of new entrants: The global ethylene market requires large capital investments for building plants and establishing distribution channels. The presence of dominant players further poses threat to new entrants.
Bargaining power of buyers: The buyers have moderate bargaining power due to the availability of substitutes. However, high production costs limit switching to alternatives.
Bargaining power of suppliers: A few suppliers control the supply of raw materials like oil and gas. This gives them strong influence over market pricing.
Threat of new substitutes: Alternatives like propylene are available but have limitations in applications. Ethylene faces low threat from substitutes.
Competitive rivalry: The market is highly consolidated with major players. Intense competition exists regarding pricing and new product development.

SWOT Analysis
Strength: Ethylene has wide applications in producing polymers and chemicals. Established production facilities and distribution networks of key players strengthen their positions.
Weakness: Fluctuations in crude oil prices affects production costs. Stringent environment regulations regarding emissions increase compliance costs.
Opportunity: Rising polymer demand from industries like packaging and construction offers scope for market expansion. Developing nations provide growth avenues.
Threats: Slowdowns in the automotive and electronics industries impact downstream polymer demand. Trade wars and geopolitical tensions pose disruptions.

Key Takeaways

Global Ethylene Market Size is expected to witness high growth between 2023-2030 supported by rising polymer consumption worldwide.

Regional analysis: The North American region is the second largest and a consistently growing market for ethylene. The presence of developed economies like the US and Canada drives polymer demand from various applications such as packaging, automotive and construction. Improvements in shale gas extraction techniques have reduced feedstock prices and given a competitive edge to domestic ethylene producers.

Key players related content Key players operating in the global ethylene market are Honeywell International Inc., Molex Incorporated, Littelfuse, Inc., RMCIP, Standex Electronics, Inc., and Nippon Aleph. Honeywell is a leading supplier of ethylene and invests heavily in expanding derivative production facilities.

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