Global petrochemicals to grow at a CAGR of 6.8% from 2014 to 2020

The global petrochemicals market is estimated to grow at a CAGR of 6.8% from 2014 to 2020. Increase in consumption of petrochemicals from major end use industries that include construction, packaging, textile, plastics, healthcare, transportation, and others coupled with encouraging operating conditions is expected to add a lot to the growth. Indian and Chinese governments' initiatives to build petrochemical complexes in the Asia-Pacific region, are also expected to boost growth in the petrochemicals market. The petrochemical producers will benefit with greater investments in coal mining and the development of alternatives resources such as shale gas. However, a shift towards developing bio-based chemicals, unstable raw material prices, and emerging environmental issues regarding the production and usage of several petrochemicals can become severe restraints for the growth of the petrochemicals market. Regulatory uncertainty and political interference from local authorities for petrochemicals has resulted in the shift of focus towards developing bio-based alternatives in the region. The global petrochemicals market is divided as: ethylene, propylene, butadiene, benzene, xylene, styrene, toulene, vinyls, and methanol. Ethylene is considered as the main component for producing several chemicals and their derivatives. It led the market for petrochemicals, accounting for over 25% of the total consumption alone in 2013. Polythene is one of the most important derivatives of ethylene and is mainly used in packaging industry. It is expected that propylene will drive the petrochemicals market during 2014 to 2020. However, due to capacity addition in the Middle East and Asia Pacific, the expanding gap between demand and supply is expected to put a worldwide pressure on ethylene prices. The propylene market is expected to make up to US$172.05 billion in terms of revenue by 2020. At an estimated CAGR of 10.3%, between 2012 and 2018, methanol is likely to be growing at a faster rate compared to others in terms of volume. The development of methanol is extensively driven by its growing usage in gasoline blending and changing it to olefins (MTO). Increased usage of butadiene in acrylonitrile butadiene styrene and styrene-butadiene rubber is expected to push the demand for butadiene in rest of Asia-Pacific region. In Asia Pacific region the usage of benzene was the highest in 2013. However, the growth rate of the benzene market is likely to be very slow in terms of volume over the forecasted period. Based on geographical regions, the petrochemical industry is divided into six segments: North America, Europe, China, Rest of Asia Pacific, Latin America, Middle East, and Africa.