Alpha Olefin Market size is forecast to reach $12 billion by 2025, after growing at a CAGR of 5% during 2020-2025. Alpha Olefin is an organic compound mainly synthesized by the oligomerization of ethylene. Alpha olefins are used in the production of high density and Low density polyethylene. Surging demand of polyethylene from packaging industries is augmenting the growth of alpha olefin market. Increasing use of alpha olefin in formulation of drilling fluids for oil and gas industries is also boosting the growth of alpha olefin market. Alpha olefins are also used in synthesis of surfactants, this may aid the growth of market.
Type – Segment Analysis
Linear alpha olefin segment holds the largest share of more than 55% in the alpha olefin market in 2019. Linear alpha olefins are widely used in the production of plasticizers. Plasticizers are added to high weight polymers such as polyvinyl chloride (PVC) for making it more flexible, durable, and elastic. Increasing use of polyvinyl chloride in wire and cable insulation, windshield system, and piping and tubing applications is accelerating the use of plasticizers, which in turn boosts the growth of alpha olefin market. According to trade map, worldwide import of compound plasticizers for rubber or plastics increased from 383,491 tons in 2017 to 401,347 tons in 2018, subsequently raising the demand for alpha olefins.
Request for Sample of the Report @ https://www.industryarc.com/pdfdownload.php?id=15151
Report Price: $ 4500 (Single User License)
Application – Segment Analysis
Based on the application, polyolefin co-monomer segment holds the largest share of more than 25% in the alpha olefin market in 2019. 1-butene, 1-hexene, and 1-octene are used as co-monomer in the production of High-density polyethylene (HDPE) and linear low-density polyethylene (LLDPE). Polyethylene is economical with low co-efficient of friction, excellent chemical & moisture resistance and lightweight properties. Rising demand for polyethylene on account of growing automotive and construction activities is augmenting the growth of the alpha olefin market. According to All India Plastics Manufacturers’ Association (AIPMA), India’s polyethylene demand may increase by 129%, surpassing Asia’s projected growth rate of 81% by 2023. Thus increase in demand of polyethylene fuels the growth of alpha olefin market.
End-Use Industry – Segment Analysis
Based on the end-use industry, packaging segment is projected to witness the highest CAGR of 7% in alpha olefin market during the forecast period. Alpha olefin acts as a plasticizer in polyethylene production and as a paper sizing agent in paper & pulp and both of them are widely used in packaging industry for wrapping or covering applications. Increasing concerns about safety and protecting the product from abrasion, water or external stresses have accelerated the use of plastic sheets for packaging applications. In order to protect the food from oxidation and moisture, packaging is preferred in food industries. Growing demand from food, beverages and pharmaceuticals is driving the growth of packaging industry which in turn fuels the growth of alpha olefin market.
COVID-19 has badly impacted the alpha olefin market. Lack of manpower has led many manufacturing companies to stop their production which further results in their downfall. Oil & Gas, paper, and automotive industries are facing huge losses, thus affecting the demand for alpha olefins. According to the Society of India Automobile Manufacturers (SIAM), passenger vehicle sales declined by 51% to 143,014 units in March 2020 whereas the sales of commercial vehicles crashed 88% to 13,027 units. Decrease in sales of automobile has hampered the growth of alpha olefin market as alpha olefins are used as lubricant and fuel additives.
Geography – Segment Analysis
North America dominated the alpha olefin market with a share of 35% in 2019 followed by Asia Pacific and Europe. Alpha olefins are used for the synthesis of oil field chemicals. Increasing demand of oil and natural gases has augmented the use of oil field chemicals for easy extraction and separation of oil & gases. According to U.S Energy Information Administration (EIA), U.S. petroleum production in 2018 increased by 16% while production of natural gas rose by 12% which further aided the growth of alpha olefin market. Furthermore, technology advancement and existence of major players such as INEOS oligomers, ExxonMobil Chemical Co., Chevron Phillips Chemical Company LP in North America further boosts the growth.
Drivers – Alpha Olefin Market
Growing demand from paper & pulp industries
Alpha olefins are utilized in the production of alkenyl succinic anhydride (ASA). Alkenyl succinic anhydride is a paper sizing agent extensively used in paper industry to increase the softness and paper’s resistance to water. Increasing environmental concerns and use of paper in packaging industry has boosted the use of alkenyl succinic anhydride which in turn augmented the growth of alpha olefin market. . According to Environmental Paper network (EPN), paper use is steadily increasing year on year and exceeded to 400 million tons per year in 2018. Thus, increase in demand of paper fuels the growth of alpha olefin market.
Surging demand for cleaner burning fuels
Isobutylene is a branched alpha olefin that finds its application in the production of methyl-tert-butyl ether (MTBE) and ethyl-tert-butyl ether (ETBE) which are gasoline blending components for cleaner burning fuels. According to U.S Energy Information Administration, total gasoline consumption in United States accounted for about 58% of total transportation sector energy consumption in 2019. Gasoline is widely used as fuel in automobiles, aircrafts, and generators for portable and emergency power supply. Thus, increase in demand of gasoline also boosts the growth of alpha olefin market.
Talk to one of our sales representative about the full report by providing your details in the link below:
Challenges – Alpha Olefin Market
Government regulations on the use of polyethylene
Although polyethylene are widely used in end use industries as a substitute of heavy metals and fibers, but non degradability and harmful effect of polyethylene on environment is a major challenge. Government restrictions on the use of polyethylene decrease the demand of alpha olefins, which in turn hampers the growth of market. For instance, California has introduced regulation known as SB270 in July 2015 for prohibiting the use of plastic bags at groceries, pharmacies, and other stores. Moreover, In Africa, in May 2019, United Nations Environmental Programme (UNEP), Tanzania banned the importation, production, sale, and use of plastic bags. Strict regulations for lowering the use of polyethylene have restrained the growth of alpha olefins.
Technology launches, acquisitions and R&D activities are key strategies adopted by players in the alpha olefin market report. In 2019, the market of alpha olefin has been consolidated by the top five players accounting for xx% of the share. Major players in the alpha olefin market are Chevron Phillips Chemical Company LP, ExxonMobil Chemical Co., Evonik Industries AG, Dow Chemical Company, PJSC Nizhnekamskneftekhim, SABIC, Mitsubishi Chemical, JAM Petrochemicals Company, Shell Chemical LP, INEOS Oligomers among others.
In June 2019, INEOS Oligomers has signed a Memorandum of Understanding with Saudi Aramco and Total, France, to build three new plants as part of the Jubail 2 complex in Saudi Arabia. INEOS will build 425,000 tons acrylonitrile plant and 400,000 tons Linear Alpha Olefin (LAO) plant.
In January 2019, Shell Chemical LP (Shell) has started the production of alpha olefins (AO) unit at its Geismar, Louisiana, USA. The 425,000-tonne-per-year capacity expansion brings total AO production at Geismar to more than 1.3 million tonnes per annum.
Among the regions, Asia-Pacific region is projected to witness the highest growth during forecast period and China hold the largest share throughout the forecast period.
Surging demand of fuel additives for better engine performance and low greenhouse gases emission is boosting the growth of alpha olefin market.
The outbreak of coronavirus has disrupted the supply chain which in turn hampered the growth of alpha olefin market. According to World trade Organization global trade may fall by between 13% and 32% in 2020 as the COVID 19 pandemic has disrupted normal economic activity.
Related Reports :
A. HDPE Pipes Market
B. Ethylene Dichloride Market
About IndustryARC: IndustryARC primarily focuses on Cutting Edge Technologies and Newer Applications market research. Our Custom Research Services are designed to provide insights on the constant flux in the global supply-demand gap of markets. Our strong team of analysts enables us to meet the client research needs at a rapid speed, with a variety of options for your business. Any other custom requirements can be discussed with our team, drop an e-mail to email@example.com to discuss more about our consulting services.