Feedstock | Jun 2020
India Ethylene Market: Plant Capacity, Production, Operating Efficiency, Technology, Process, Demand & Supply, Application, End Use, Distribution Channel, Region, Competition, Trade, Customer & Price Intelligence Market Analysis, 2015-2030
India Ethylene market has witnessed significant growth over the last five years and is projected to grow at a CAGR of nearly 5.45% during the 2022-2030. Increasing demand for Ethylene for manufacturing Polyethylene also called polythene, which is popularly used to make plastic films for packaging applications. Polyethylene production consumes more than half of the India’s total Ethylene demand.
Increasing demand for polyethylene such as HDPE, LDPE, mLLDPE etc. from the packaging sector driven by increasing organized retail and the boom in the e-commerce industry will drive the growth of the India Ethylene market in the forecast period. Moreover, increasing use of plastic packaging in food, beverages, personal care, healthcare and consumer electronics industries will further augment the growth in demand of Ethylene in the forecast period. Rapid urbanization and infrastructure developments will further escalate the demand for building and construction plastics, another major end-use segment of the India Ethylene market.
Ethylene Oxide (EO) is the second largest consumer of India’s Ethylene. EO finds key applications in manufacturing Ethylene Glycol, the most common of which is monoethylene glycol (MEG). MEG is used for making PET resins which is used for making bottles and is also used in several antifreeze applications. Demand for several EO derivatives like ethyoxylates (used in shampoo, kitchen cleaners, etc), glycol ethers (solvents, fuels, etc) and ethanolamines (surfactants, personal care products, etc) will always remain healthy in the forecast period. Moreover, rising demand for Ethylene derivatives such as Polyvinyl Chloride (PVC), Polystyrene (PS) and Polyester Resins will give a strong boost to the growth of Ethylene Industry in India.
During Q4 2020, the Indian petrochemical industry witnessed a severe shock due to demand slowdown as the Indian government imposed strict nationwide lockdown to contain the spread of COVID-19, which disrupted trade, logistics and almost all industrial operations across the nation. Lengthened Ethylene supply due to evaporating demand, pressured India’s Ethylene prices which hit the record breaking lows in the last quarter of FY20. Moreover, a sharp decline in crude oil prices further lowered the feedstock Naphtha values thereby contracting Ethylene margins. Evaporating Polyethylene demand and swelling inventories forced domestic refiners like RIL, IOCL and Haldia to shut their Ethylene crackers temporarily. In April this year, the Gas Authority of India Ltd (GAIL) announced temporary shutdown of its 400KTPA Polyethylene (PE) plant at Pata in Uttar Pradesh to deal with excess inventory during the pandemic crisis. However, with ease in lockdown restrictions and restart of downstream sectors, several refiners ramped up their plant operating rates by Q1FY20 to erase incurred losses. Moreover, factors such as government’s keen focus on ramping domestic production and incentives such as import duty waivers over cheaper feedstocks are likely to lend a strong support to the India Ethylene industry in the coming years.
Years Considered for this Report:
Historical Years: 2015 – 2019
Base Year: 2020
Estimated Year: 2021
Forecast Period: 2022 – 2030
Objective of the Study:
• The primary objective of the study was to evaluate and forecast Ethylene capacity, production, demand, inventory, and demand – supply gap in India.
• To categorize Ethylene demand based on end use, grade, application, region and sales channel.
• To study trade dynamics and company share in India Ethylene market.
• To identify major customers of Ethylene in India.
• To evaluate and forecast Ethylene pricing by grade in India Ethylene market.
• To identify and profile major companies operating in India Ethylene market.
• To identify major news, deals and expansion plans in India Ethylene market.
Some of the domestic players operating in India Ethylene market are Reliance Industries Limited, Indian Oil Corporation Limited, GAIL (India) Limited, ONGC Petro Additions Limited and Haldia Petrochemicals Limited. LyondellBasell, Dow Chemical Co., ExxonMobil, Chevron Phillips, Shell, INEOS etc. are some of the international players operating in India Ethylene market. State-owned Bharat Petroleum Corporation Ltd (BPCL) is planning to invest INR 25,000 crore to set up an ethylene cracker plant at Rasayani, located at a distance of 50 km from its Mumbai refinery. The investment would fuel the growth of BPCL’s petrochemical’s business which currently holds only about 1per cent share in the country’s petrochemicals sector as the refiner’s main focus was on the transportation fuels so far.
Import of Ethylene decreased by almost 2.1 per cent in FY 20 and Ethylene yearly prices were assessed at USD XXX per MT on bulk contract basis. Ethylene CFR prices in India hovered between $350-430 per tonne CFR in Q4FY20 due to COVID-19 related uncertainties and cheaper feedstock. However, with downstream sectors restarting their production activities, prices are likely to show an uptrend by the Q2FY21.
To extract data for India Ethylene market, primary research surveys were conducted with Ethylene manufacturers, suppliers, distributors, wholesalers and end users. While interviewing, the respondents were also inquired about their competitors. Through this technique, ChemAnalyst was able to include manufacturers that could not be identified due to the limitations of secondary research. Moreover, ChemAnalyst analyzed various end user segments and projected a positive outlook for India Ethylene market over the coming years.
ChemAnalyst calculated demand for Ethylene in India by analyzing the historical data and demand forecast was carried out considering crude oil prices. ChemAnalyst sourced these values from industry experts and company representatives and externally validated through analyzing historical sales data of respective manufacturers to arrive at the overall market size. Various secondary sources such as company websites, association reports, annual reports, etc., were also studied by ChemAnalyst.
Key Target Audience:
• Ethylene manufacturers and other stakeholders
• Organizations, forums and alliances related to Ethylene distribution
• Government bodies such as regulating authorities and policy makers
• Market research organizations and consulting companies
The study is useful in providing answers to several critical questions that are important for industry stakeholders, such as Ethylene manufacturers, distributors and policy makers. The report also provides useful insights about which market segments should be targeted over the coming years to strategize investments and capitalize on growth opportunities.
In this report, the India Ethylene market has been segmented into following categories, in addition to the industry trends which have also been detailed below:
Market, by Application
Polyethylene (PE), Ethylene Oxide (EO), Polystyrene (PS), Polyvinyl Chloride (PVC), Others
Market, by End Use
Packaging, Construction, Automobile, Electrical and Electronics, Others
Market, by Sales Channel
Direct/Institutional Sales, Retail Sales, Other Channel Sales
Market, by Region
North, West, East and South
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