Acetic Acid is a carboxylic acid and is used across a host of industrial and household applications. Synthetic acetic acid is manufactured by methanol carbonylation or methyl acetate carbonylation or butane/naphtha oxidation. Acetic acid is one of the most essential chemical reagents in the chemical industry, used in the production of polyvinyl acetate and cellulose acetate which is further used in the production of fibers and fabrics. Apart from its use in the chemical industry it finds major usage in the household as a descaling agent food additive and as a condiment. Acetic acid can also be produced by bacterial fermentation but this segment accounted for less than 10% of global produced volume. The raw material cost is a key factor determining the demand for acetic acid. Over 75% of the global acetic acid is manufactured by methanol carbonylation and has significant impact on methanol supply dynamics. Companies manufacturing acetic acid globally have been stressing to develop technologies to minimize their investment in raw materials by innovating technologically as well as backward and forward integrating largely to maximize profits. Many petrochemical majors and chemical giants like British petroleum, Celanese, Eastman Chemicals, Sinopec and SABIC etc. have highly integrated their operations and are involved in the production of end products of acetic acid right from its feedstock. This process of integration reduces the capital investment, catalyst cost and brings overall energy efficiency.
Key applications markets include its use in the manufacturing of Vinyl Acetate Monomer (VAM) and purified Terephthalic Acid (PTA) which is used for downstream applications such as PET manufacturing, adhesives and sealants. A key factor driving the market is the increased demand from the application industry resulting in increased demand for acetic acid. VAM is used in the adhesive and sealants industry and can be commercially manufactured only by the use of acetic acid. Over the past few years, the demand for VAM has been on the rise due to the increasing consumption of adhesive and sealants in light of rapid industrialization of emerging economies. In addition, the increased demand for PET from the packaging industry is further expected to augment the sales of acetic acid which is the chief raw material for manufacturing of PTA. The demand for PET is expected to reach close to 25,000 Kilo tons by 2020, growing at a CAGR of over 4% from 2014 to 2020. Formaldehyde is the largest application of methanol followed by acetic acid. Methanol prices have been fluctuating due to the demand supply scenario in the global natural gas market. This has led to uncertainty in the acetic acid prices and is expected to hamper the growth of the market. The global demand for acetic acid was 10,449.1 Kilo tons in 2013 and is expected to grow at a CAGR of 5.1% from 2014 to 2020. Market revenue is expected to reach USD 12,191.2 million by 2020, growing at an estimated CAGR of 9.2% from 2014 to 2020.
The application segments covered in the study include vinyl acetate monomer, purified terephthalic acid, acetate esters and acetic anhydride. Vinyl acetate monomer (VAM) was the largest application segment for the market accounting for 32% of global acetic acid consumption in 2013. Consumption of acetic acid in the manufacturing of VAM generated revenue of over USD 1,990.2 million in 2013 primarily driven by the demand for VAM in the adhesive and sealant industry. The demand for adhesive and sealant was over 9,000 Kilo tons in 2013 and is expected to increase at a CAGR of over 4.5% from 2014 to 2020. VAM is a key raw material in the manufacturing of water based adhesive which accounts for close to 54% of the global adhesive and sealants market and the increasing demand from Asia Pacific is expected to boost the demand for acetic acid over the forecast period. The other key application of acetic acid is PTA which accounted for 3,009.2 Kilo tons of acetic acid consumption in 2013. PTA is a precursor to the manufacturing of PET which is extensively used in the packaging and construction industry. The urbanization of countries in South Asia has led to massive demand for PET as a packaging material which is expected to increase escalate the demand for PTA, in turn augmenting the sale of acetic acid. Acetate esters are primarily used as solvents for paints, coatings and inks.
Acetic acid market volume share, by application, 2013
China was the largest regional market for acetic acid with consumption in excess of 3,898.5 Kilo tons in 2013. Strong industrial growth has led to increased demand from application segments such as construction and automotive. China has the world largest and fastest growing automotive industry resulting in increased demand for adhesive and sealants. In addition, the cheap labor and raw material has resulted in increased manufacturing activities in the region resulting in increased demand for acetic acid. Rest of Asia was the second largest consumer of acetic acid due to the growing demand from countries such as India and Japan. North America and Europe together accounted for 30% of global consumption in 2013. However, the reduced manufacturing activity in the region coupled with increased regulatory pressure on the use of bio based products is expected to constraint the demand for acetic acid. The regions are expected to witness sluggish growth at an estimated CAGR of 4.0% and 3.3% respectively from 2014 to 2020.
The key players in the market include Celanese Corporation, British Petroleum, Jiangsu Sopo and Eastman Chemicals. These companies together accounted for over 65% of the market share in 2013. The other major players in the market include Yancon Cathay Chemical, LyondellBasell, SABIC, DuPont, BASF, Petrochina, Sasol, Sinopec and Mitsubishi Chemicals. The market is highly innovation centric with a large number of companies focusing in the development if new technologies with alternate feedstock. Calanese Corporation developed a technology called TCX with the aim to reduce dependency on oil and gas. It is a hydrocarbon based ethanol production technology which is expected to results in increased yield of acetic acid when commercialized.