Ethylene Carbonate Market

The Global Ethylene Carbonate Market had a value of USD 473 million in 2023 and is expected to reach USD 901 million by 2030, with a compound annual growth rate (CAGR) of 13.7% during the period from 2023 to 2030. The growth of the market is primarily driven by the increased sales of battery-powered electronics and the growing adoption of electric vehicles. These factors have led to a rise in the demand for Li-ion battery electrolytes, which in turn has increased the demand for ethylene carbonate. Furthermore, the expansion of automotive manufacturing activities has contributed to the demand for ethylene carbonate as a lubricant. Consequently, it is evident that the automotive industry is playing a significant role in the growth of the ethylene carbonate market.

Ethylene Carbonate Market Dynamics
Driver: Increasing demand for ethylene carbonate in the production of lithium-ion battery electrolytes
The transportation sector currently relies heavily on oil as fuel, which has raised concerns among environmentalists and economists. The growing awareness of sustainable energy sources has led to the adoption of batteries in vehicles. According to the International Energy Agency, the number of electric vehicles on the road has surpassed 10 million units, and their sales continue to rise year after year. As ethylene carbonate serves as a polar solvent for electrolytes used in these lithium-ion batteries, its demand is expected to experience significant growth during the forecast period.

Restraint: Use of toxic raw materials in ethylene carbonate production
Despite being a greener solvent, the traditional production method of ethylene carbonate involves the use of toxic chemicals such as ethylene oxide and carbon dioxide. Exposure to ethylene oxide can lead to various physical and health hazards, including respiratory irritation, lung injury, headache, nausea, and cyanosis. It is classified as a high-priority pollutant by the US EPA. Similarly, exposure to carbon dioxide can cause shortness of breath, headache, nausea, and asthma. It is also classified as a greenhouse gas. Consequently, the use of these chemicals is highly regulated, limiting the growth potential of the market.

Opportunity: Increase in use of bio-based plasticizers
Ethylene carbonate finds applications as a plasticizer to enhance the ionic conductivity of polymer electrolytes in various sectors, including PVC cable, vinyl flooring, and automobile part manufacturing. Stringent regulations and norms regarding the use of harmful phthalates as plasticizers have prompted the development of alternative, environmentally-friendly plasticizers using ethylene carbonate. The demand for PVC products, which account for over 90% of plasticizer usage, is expected to grow significantly in the near future. This presents an excellent opportunity for ethylene carbonate manufacturers to target and capture market share.

Challenge: Fluctuating Oil & Gas Prices
The global demand for crude oil, coupled with geopolitical tensions in the Middle East and between Russia and Ukraine, has led to fluctuations in the prices of ethylene carbonate. These price fluctuations directly impact transportation and manufacturing costs for ethylene carbonate manufacturers. In response to increased costs, manufacturers have raised the prices of their products in the past. Therefore, the volatility in oil and gas prices poses a challenge for the ethylene carbonate market.

Solid form dominates the market currently
Currently, the solid form of ethylene carbonate holds the largest market share. Ethylene carbonate is a transparent crystalline solid at room temperature and is utilized in this form across various key applications. It serves as a crosslinking agent in the production of super absorber polymers, aids in the separation of gas washing processes and oil fields, and acts as an intermediate in the synthesis of polycarbonate diol. It also finds use as plasticizers, resist strip solvents, fiber processing agents, soil hardening agents, organic solvents, raw materials for organic synthesis, and medical products. However, with the increasing demand for lithium batteries, the liquid form is projected to surpass the solid form and take the lead during the forecast period.

Lithium battery electrolytes to dominate the market demand during the latter half of the forecast period
In terms of applications, the lithium battery electrolytes segment is projected to dominate the market share by the end of the forecast period. The growth in this segment can be attributed to its increasing usage in various industries such as industrial, oil & gas, and automotive. In the automotive sector, lithium batteries are gaining significant popularity as a sustainable energy source. These factors mentioned above are anticipated to drive the demand for lithium battery electrolytes during the forecast period.

In relation to end-use industries, the automotive segment is expected to be the primary contributor to the ethylene carbonate market during the forecast period. Specifically, the automotive sector is projected to hold the largest share of the market in 2023. This growth can be attributed to the rising sales of electric vehicles (EVs). For instance, in Europe, the sales of EVs witnessed a remarkable 66% increase in 2023, as reported by the International Energy Agency. Ethylene carbonate plays a crucial role in the production of batteries for these vehicles, as well as in automotive lubricants, surface coatings, and manufacturing of automotive plastics. These factors are expected to drive the demand for ethylene carbonate in the automotive industry throughout the forecast period.

Asia Pacific is expected to account for the largest market size during the forecast period
Asia Pacific emerges as the largest and fastest-growing market for ethylene carbonate, driven by its increasing utilization across diverse end-use industries, including oil & gas, automotive, industrial, and medical sectors. The region benefits from a strong manufacturing presence, supported by government policies promoting sustainable energy solutions for industries. Notably, China leads the market for electric vehicle (EV) battery manufacturing, resulting in heightened demand for ethylene carbonate. Additionally, several key players in the ethylene carbonate market, such as Mitsubishi Chemical Holding (Japan) and Shandong Shida Shenghua Chemical Group Co., Ltd. (China), have established their production bases in the Asia Pacific region. These factors are expected to drive market growth throughout the forecast period.

Expansion of Battery-Grade Capacity by Key Market Players
The growing demand for battery-electrolyte grade ethylene carbonate, driven by the development of modern electric vehicles, has prompted numerous companies in the market to adjust their production processes and increase the production of this specific grade. Additionally, many market players have announced investments to expand their production capacities, capitalizing on the rising sales of EVs. Furthermore, new entrants are also expanding their production capabilities to meet the increasing demand for ethylene carbonate across various end-use industries.

The major vendors in the ethylene carbonate market include Oriental Union Chemical Corporation (Taiwan), Huntsman (US), BASF (Germany), Mitsubishi Chemical (Japan), Toagosei Co., Ltd. (Japan), New Japan Chemical Co. Ltd (Japan), Shandong Shida Shenghua Chemical Group (China), Zibo Donghai Industries Co. Ltd. (China), and Shandong Senjie Cleantech Co. Ltd (China).

This research report categorizes the ethylene carbonate market based on its form, application, end-use industry, and region.

Based on form, the ethylene carbonate market has been bifurcated as follows:
• Solid
• Liquid

Based on application, the ethylene carbonate market has been segmented as follows:
• Lithium Battery Electrolytes
• Lubricants
• Plasticizers
• Surface Coatings
• Others (capacitor electrolytes, resist strip solvents, fiber processing agents, soil hardening agents, organic solvents, and pharmaceuticals)

Based on the end-use industry, the ethylene carbonate market has been segmented as follows:
• Automotive
• Industrial
• Medical
• Oil & Gas
• Personal Care & Hygiene
• Others (electronics, textile, and energy)

Based on region, the ethylene carbonate market has been segmented as follows:
• Asia Pacific
• North America
• Europe
• Middle East & Africa
• South America

Recent Developments
• Lotte Chemical revealed plans in February 2023 to construct a new facility in Daesan, South Korea, aimed at manufacturing high-purity organic solvents like ethylene carbonate. This investment, totaling US$502 million, is part of Lotte Chemical's commitment to the sustainable specialty materials business, specifically catering to the production of electric vehicle batteries.
• Huntsman Corporation announced in June 2021 the expansion of its ULTRAPURE Ethylene Carbonate manufacturing facility in Conroe, Texas, USA. This expansion project is a response to the increasing demand for lithium-ion batteries in electric vehicles, ensuring Huntsman can meet the growing market needs.