The global ethylene oxide (EO) market has been growing at a CAGR of 4.4% from the year 2000 to 2009. It is forecast to grow at a CAGR of 4.5% from the year 2009 to 2020, as per a report by GBI Research. Global demand for EG is expected to grow from 18.926 mln tons in the year 2009 to 34.088 mln tons in the year 2020.
Ethylene Oxide (EO) and Ethylene Glycol (EG) are intermediate products which are used to produce a large number of products. Ethylene Oxide is also known as Oxirane. Ethylene Glycol (EG) is an organic compound which is derived by the hydrolysis of Ethylene Oxide (EO). It is used to produce anti-freeze for automobiles and PET which further gives polyester fiber and PET resin. PET resin is used mainly in packaging applications.
Asia is the largest consumer of both EO and EG in the world, driven largely by China whose demand is larger than that of any other country in the world. Asia had a share of 35% in the global demand for EO in 2009. North America was second largest region with a share of 24%. Share of Asia in Global EG demand in the year 2009 was 63%. North America had the second largest demand at 20%. About 85% of the EG produced in Asia goes into production of PET which is used to prepare polyester fibre and PET resin. Demand in Asia is driven by China and India. China has a high per capita consumption of polyester fibre. Per capita consumption of polyester fibre in India is low but it is growing at a very fast pace. Also, China and India are world’s fastest growing economies in terms of GDP. This is helping in the growth of packaging applications of PET.