Butadiene is the primary raw material used in the production of many elastomers such as styrene-butadiene rubber (SBR), polybutadiene, acrylonitrile butadiene styrene (ABS), styrene-butadiene latex, and nitrile rubber among others. It is primarily produced through the steam cracking method but from butane or butene dehydrogenation as well. The demand for synthetic rubbers is heavily influenced by the automotive industry which in turn impacts the butadiene market while the supply is dependant on the ethylene industry– that is a primary product needed for the steam cracking method. Thus, the butadiene industry is heavily influenced by the demand-supply forces of other markets.
The global butadiene market is projected to grow at a CAGR of 1.59% to reach a market size of US$15.815 billion in 2025 from US$14.386 billion in 2019. The latter half of the forecast period is projected to be the prime revenue driver based on the anticipated recovery of the auto industry in that period. Simultaneously, the growing investment in the construction industry – boosted mainly by the expanding middle-class population and focus of the government of the emerging economies to provide affordable housing for the mass population is further expected to push the demand for synthetic rubber for sealing, roofing, and flooring applications.
Chandra Asri Petrochemical recently expanded its butadiene production capacity from 100KTA to 137KTA.
In January 2019, Toyo Engineering Korea Limited was awarded the Engineering, Procurement and Construction project from Bangkok Synthetics Company Ltd. (BST) that involves the construction of 1,3-Butadiene & Butene-1 production units with a total capacity of 80 KTA & 34 KTA, respectively, at BST’s existing petrochemical complex in Map Ta Phut, Rayong, Thailand.
Hengli Petrochemical has recently achieved its on-specification butadiene production at its 400,000 b/d dallan complex.
Zhejian Peteochemcial has recently expanded its butadiene capacity.
In January 2020, CPC Corporation reportedly resume operations at one of its naphtha crackers in Taiwan after the major maintenance of the site was completed that has the capacity of manufacturing 380 tons/year of ethylene – a major feedstock for butadiene and 193,000 tons/year of propylene.
TPC group announced recently that it will be rebuilding its butadiene processing facility located at South East Texas petrochemical complex that was destroyed in the November 2019 explosion.
In August 2019, Nanjing Chengzhi Yongqing Energy Technology Co., Ltd.’s new 100KTA butadiene plant that was built by Wison Engineering started operations successfully and produced on-spec butadiene.
Jiangsu Sailboat Petrochemical Company Ltd. announced in January 2018 that it accepted a new methanol-to-olefins (MTO) unit provided by Honeywell UOP that has the potential of offering greater yield with relatively lower production cost and catalyst consumption.
MOLGroup has a butadiene plant in Tiszaújváros, Hungary with a capacity of 130kt/year. The company is planning to expand the site from 2021 onwards with its new polyol complex.
JG Summit Holdings, Inc. recently announced its plans to start a new butadiene extraction unit that will produce 70KTA butadiene and 89KTA raffinate-1.
The butadiene market is heavily influenced by the overall rubber demand – which in turn is dependant on the automotive and airline industry, primarily for tire applications. The automotive industry was already going through a phase of slow demand due to weak global macroeconomic conditions, with the global vehicles sales declining by 4.49% in 2019, following a 0.01% reduction in 2018 (source: International Organization of Motor Vehicle Manufacturers). However, the COVID-19 pandemic has further aggravated the declining trend, with the global vehicles sales anticipated to decline by more than 20%.
Simultaneously, the tire demand by the airline industry mainly comes from the replacement market, in which it is estimated that the tire of an aircraft is required to be changed after 250-400 take-offs. The temporary suspension of the airline's operations in major countries is expected to delay the replacement demand for tires in the aviation industry. In the United States, the air traffic fell drastically this year as the country tops the list of most severely hit economies by the COVID-19 pandemic. According to data from the World Bank Group, the USA has more than 6 million confirmed COVID-19 cases with a total number of deaths standing up to 184,614. As air travel continues to be restricted, on account of restrictions imposed by the government, air travel revenues are getting affected. In France, the tourism sector, which accounts for nearly 8% of the country’s GDP, was expected to register €50 billion in tourism receipts by this year but the actual numbers are way away from this target. The novel coronavirus disease spread in the country pushed the government to close its borders. Restrictions on air travel by the government have been hurting the air travel market growth across the country. Similarly, other countries such as the United Kingdom and India continue to struggle with protecting their people from the novel coronavirus disease, which, to date, does not have a solid cure, restrictions on air travel can be justified. Even if these restrictions are lifted, the number of people traveling by air is still expected to remain low as the fear of contracting the disease would continue to keep many people away from it. In fact, according to the Knowledge Sourcing Intelligence, the airline's revenues are expected to decline by approx. 50% in 2020, in comparison to the 2019 revenues level.
It is projected that the second half of the forecast period is likely to provide better revenue generation opportunities on account of the recovery of the airline's revenues to the pre-crisis level and improvement in the outlook for the automotive industry. One bright spot amidst the crisis is the positive demand from the medical sector, and specifically – the medical glove market. Medical gloves are very niche applications for synthetic rubber and any radical changes in their demand are not going to impact the overall demand for synthetic rubber significantly. Medical gloves based on synthetic materials, more specifically, nitrile rubber has been gaining traction in the overall medical glove industry globally. In fact, most of the gloves exported by Malaysia – the largest glove producer globally, are made of synthetic material. Anticipating a similar trend, the market growth was initially projected to be around 10.5% in 2020. However, the COVID-19 pandemic has drastically changed the economic landscape, with a number of healthcare facilities being converted into COVID-19 facilities on account of the rising number of COVID-19 patients. Thus, the projection for the synthetic medical gloves market in the COVID-19 scenario is significantly revised upwards – with the overall synthetic rubber-based medical gloves market is estimated to grow by almost three times than what was originally projected in the no COVID-19 scenario in 2020.
|Market size value in 2019||US$14.386 billion|
|Market size value in 2025||US$15.815 billion|
|Growth Rate||CAGR of 1.59% from 2019 to 2025|
|Forecast Unit (Value)||USD Billion|
|Segments covered||Application, And Geography|
|Regions covered||North America, South America, Europe, Middle East and Africa, Asia Pacific|
|Companies covered||LOTTE Chemical Corporation, CPC Corporation, Formosa Petrochemical Corporation, JSR Corporation, ENEOS Corporation, Zeon Corporation, Exxon Mobil Corporation, BASF SE, TPC Group, LyondellBasell Industries Holdings B.V., Shell International B.V., INEOS, Hengli Petrochemical Co. Ltd., Chandra Asri Petrochemical, PJSC Nizhnekamskneftekhim|
|Customization scope||Free report customization with purchase|
Styrene Butadiene Rubber (SBR)
Styrene Butadiene Latex
Acrylonitrile Butadiene Styrene (ABS)
The United States
The United Kingdom
Middle East and Africa
Frequently Asked Questions (FAQs)
Q1. What will be the butadiene market size by 2025?
A1. The global butadiene market is projected to reach a market size of US$15.815 billion in 2025.
Q2. What are the growth prospects for the butadiene market?
A2. The butadiene market is projected to grow at a CAGR of 1.59% during the forecast period.
Q3. What is the size of the global butadiene market?
A3. The global butadiene market was valued at US$14.386 billion in 2019.
Q4. How is the global butadiene market segmented?
A4. The butadiene market has been segmented by application and geography.
Q5. What factors are anticipated to drive the butadiene market growth?
A5. The latter half of the forecast period is projected to be the prime revenue driver based on the anticipated recovery of the auto industry in that period.
LOTTE Chemical Corporation
Formosa Petrochemical Corporation
Exxon Mobil Corporation
LyondellBasell Industries Holdings B.V.
Shell International B.V.
Hengli Petrochemical Co. Ltd.
Chandra Asri Petrochemical
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