Ethylene Glycol is commonly known as ethane-1,2-diol. It is a clearand slightly viscous liquid. It belongs to the alcohol family of organiccompounds. Although it is sweet tasting compound, it is extremely perilous.Ingestion of ethylene glycol solution can result in acute illness and in manycases may even cause death.
Benefits of Ethylene Glycol
Commercially and industrially, ethylene glycol is commonly used as anti-freezing agent or coolant. In winters, it prevents the engine of the car from freezing and in summers it acts as a coolant to minimize overheating in the engine. It is also used as an industrial coolant for gas compressors, ventilators, and air-conditioning systems. Additionally, it is used as a raw material, for the production of polyester fibers that are used for making carpets, pillows, clothes, upholstery etc. It is also used to manufacture fiberglass and polyethylene terephthalate resin.
Global Ethylene Glycol Market Insights: The Demand, Drivers, and Challenges
Volume-wise the overall ethylene glycol market is largely spearheaded by the product mono-ethylene glycol or MEG. MEG is the prime component for the production of polyethylene terephthalate a.k.a PET, commonly known as polyester. The global MEG demand is highly influenced by its applications. Let us find out the three main industries that are directly contributing to the high consumption of MEG:
1. Packaging Industry
The surge in consumption of PET from the packaging industry has drastically inflated the MEG market, thereby escalating the production of ethylene glycol. The pharmaceuticals and food & beverage industry are the main drivers of the packaging industry. In fact, presently on the global front, the PET bottles hold the second largest market for MEG consumption.
2. Automobile Industry
The second most widely used application of MEG is in antifreeze a.k.a coolant. Antifreeze formulation is used as a de-icing fluid in aircraft and windshields. In vehicles, it permits higher engine temperatures and improves fuel efficiency. Thus, this is the second largest driver for ethylene glycol.
3. Textile Industry
Another key MEG driver is the textile industry that consumes a large amount of polyester fiber. The Asia-Pacific region is witnessing a steep textile & fiber production curve and is leading the production as well as the consumption of MEG.
The global ethylene glycol market is forecast to grow at a CAGR of approximately 3.9 percent to reach $35.1 million by 2022. It is high in demand in North America, Europe, Asia Pacific, Latin America, the Middle East, and Africa. The markets in APAC and North America are estimated to grow by leaps and bounds in the coming five years. The leading global suppliers for ethylene glycol market include companies like Dow Chemical Company, Royal Dutch Shell Plc., and SABIC.
Global Challenges faced by Ethylene Glycol Market
The rapid fluctuation in prices of raw material coming from several economies, crude oil so to say, is a critical factor that is extensively prohibiting the ethylene glycol market expansion. The increasing environmental concerns globally are also drawing flak towards plastic consumption, thereby affecting the demand for polymer resins and PET. Although the manufacturers are taking initiatives by searching for eco-friendly solutions for curbing plastic pollution, the implementation will not see the light of the day any time soon.
As of now, the ethylene market is becoming increasingly competitive and is clearly dominated by the regional suppliers. As the intensity of existing competition is anticipated to increase in the near future, the new suppliers are likely to face the heat.