February 25, 2024
Petrochemicals Industry

Rapid industrialization to boost growth of the Petrochemicals Market

The global Petrochemicals Market is estimated to be valued at US$ 565.55 Bn in 2023 and is expected to exhibit a CAGR of 9.2% over the forecast period 2023-2030, as highlighted in a new report published by Coherent Market Insights.

Market Overview:
Petrochemicals are vital raw materials for a wide range of industrial and consumer goods. Some key petrochemical products include ethylene, propylene, benzene, xylene, and butadiene. These products are used to manufacture plastics, synthetic fibers, solvents, rubber products, lubricants, and other chemicals. Growing industrial and infrastructure development activities are fueling the demand for petrochemical derivatives such as polymers, plastic resins, synthetic rubbers, and fibers. Rapid urbanization and rising population in emerging countries is driving the demand for consumer products manufactured using petrochemicals, thereby propelling the petrochemicals market growth.

Market key trends:
One of the major trends in the petrochemicals market is increasing focus towards sustainability and adoption of green chemistry principles. Various companies are investing in R&D to develop bio-based and recyclable petrochemical products. For instance, major players are collaborating with researchers to produce polyethylene and polypropylene from sugarcane ethanol instead of naphtha. Moreover, with rising environmental concerns, regulatory norms towards plastic waste recycling are becoming stricter worldwide, which is augmenting the demand for recycled petrochemical products.
Porter’s Analysis

Threat of new entrants: The petrochemicals market requires massive capital investment for setting up production facilities. Stringent environmental regulations also pose barriers for new companies.

Bargaining power of buyers: Large buyers like automotive and construction industries have significant influence over prices. However, the presence of many buyers prevents any single buyer from drastically lowering prices.

Bargaining power of suppliers: A few big companies control the supply of key feedstocks like natural gas and crude oil. This gives them negotiation power over petrochemical producers.

Threat of new substitutes: No close substitutes exist for basic petrochemicals that act as building blocks for various derivative products. Technology breakthroughs may introduce new green substitutes in the long run.

Competitive rivalry: The market is dominated by large multinational corporations. Intense competition exists regarding prices, product differentiation, research and development.

Key Takeaways

The global Petrochemicals Market Share is expected to witness high growth, exhibiting CAGR of 9.2% over the forecast period, due to increasing demand from end-use industries like packaging, automotive and construction. The market size for 2023 is estimated at US$ 565.55 Bn.

The Asia Pacific region currently dominates the global petrochemicals market owing to burgeoning manufacturing sector and growing construction activities in China and India. Other rapidly growing markets include Middle East and North Africa.

Key players operating in the petrochemicals market are BASF, SABIC, TOTAL, Indian Oil Corporation Limited, Chevron Phillips Chemical Company, BP PLC, Sumitomo Chemical Company, Reliance Industries Limited, DowDuPont, Royal Dutch Shell. These companies are investing significantly in capacity expansions as well as innovations.

*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it