Butadiene market is estimated to be valued at USD 35.38 Bn in 2024, exhibiting a CAGR of 6.1% over the forecast period 2024-2031. Increasing synthetic rubber production for applications in various industries like tire, automobile and footwear is expected to boost demand for butadiene.
Rising Demand from Synthetic Rubber Industry
Butadiene serves as a key component in producing synthetic rubbers like styrene-butadiene rubber and acrylonitrile butadiene rubber. Growing automotive industry coupled with increasing rubber consumption per vehicle boosts demand for synthetic rubber, and this boosts the consumption of butadiene on a large scale.
Growing End-use Applications
Butadiene finds numerous applications, beyond synthetic rubber, in industries like plastics, latex and resins. Rising product usage in footwear, wires & cables, construction and packaging industries is expected to drive the market growth. Innovation in butadiene application areas would create new opportunities over the forecast period.
Growing Demand for Synthetic Rubber from Automotive Industry
Global synthetic rubber market growth is primarily driven by increasing demand for rubber from the automotive industry. Butadiene is a key raw material that is used in the production of synthetic rubbers like styrene-butadiene rubber (SBR) and Polybutadiene rubber (PBR). SBR finds wide application in tire manufacturing, where it is used to provide strength, durability and traction to tires. With rising vehicle ownership, increasing vehicle kilometers traveled and improving economic conditions globally, the demand for tires and other auto components is experiencing robust growth. This rising need for synthetic rubbers in the automotive sector boosts consumption of butadiene around the world.
Growth of End-use Industries like Plastics and Construction
Butadiene also serves as an important monomer in the plastics and polymers industry. It is used to make ABS resins, NBR rubber and PB polymer. The construction industry has emerged as a major end-use sector of plastics and polymers globally. As infrastructure development accelerates with growing urbanization and industrialization, the demand for plastics and polymers in applications like pipes, fittings, doors, windows, and others increases significantly. This has a positive impact on butadiene consumption. The packaging industry is another rapidly expanding outlet for plastics that use butadiene-based resins like ABS and SAN. Overall growth of end-use industries is expected to drive the growth of global butadiene market.
Environmental Regulations on Butadiene Emissions
Stringent regulations imposed by environmental agencies regarding butadiene emissions can hamper the market growth. Butadiene is considered a potential human carcinogen and its emission levels are strictly regulated across regions. Manufacturing facilities producing butadiene have to invest heavily in adopting abatement technologies to curb emissions and meet statutory standards. Strict compliance with such norms increases production costs.
Fluctuating Raw Material Prices
Uncertain raw material prices can hamper the market growth. Butadiene is extracted from naphtha through a catalytic process. Naphtha prices demonstrate significant volatility depending on global crude oil supply and demand dynamics. Any increase in naphtha feedstock costs increases butadiene prices, thus, reducing its affordability and competitive ability against substitute materials. Fluctuating raw material costs make operations difficult to plan for butadiene producers and consumers. Stable raw material prices are necessary to ensure sustainable growth in this market.
High Import Demand in Asia
Asia Pacific represents a major opportunity area due to robust import demand from China and India. These developing countries have emerged as globally prominent automotive and construction hubs. However, their ability to meet total butadiene requirements through domestic production alone remains limited. This import gap provides lucrative prospects to international butadiene suppliers. Infrastructure development programs proposed by various APAC governments can boost local polymers and plastics sectors in the near future. This bodes well for sustained butadiene imports in Asia Pacific.
Scope for Capacity Expansions
Continuous capacity expansions by leading manufacturers present for the market growth. Given the strong volume growth projections, players are investing in capacity augmentations across geographies. For example, Saudi Aramco recently announced increasing their butadiene output through debottlenecking initiatives. Industries are also ramping up chemical complex sizes. Such capacity additions will cater to the ballooning demand and ensure product availability. Participating in the expansion race through timely investments maintains competitive positioning in this dynamic marketplace.
Link: https://www.coherentmarketinsights.com/market-insight/butadiene-market-5448
Key Developments
- In April 2023, Sinopec's subsidiary, Hainan Baling Chemical New Material, made a significant stride in its operations by inaugurating a new styrene-butadiene copolymer (SBC) plant in China. This state-of-the-art facility boasts a production capacity of 170,000 tons per year, positioning the company as a key player in the SBC market and enhancing its capabilities in the chemical industry.
- In 2023, MBA Polymers UK, a leading recycler of plastic waste, announced the launch of its new post-consumer acrylonitrile butadiene styrene (ABS) product. This innovative development represents a significant step forward in the company's efforts to promote sustainable practices and circular economy principles within the plastics industry.
- In 2022, INEOS, a leading global chemicals company, and SINOPEC, one of the largest integrated energy and chemical companies in China, signed a joint venture agreement to develop a brand-new petrochemicals complex in Tianjin, China. This strategic partnership marks a significant milestone in the two companies' collaboration and their commitment to expanding their presence in the growing Chinese market.
- In 2022, BASF extended its series of Licity anode binders for Li-ion battery manufacturing. The second-generation styrene-butadiene rubber (SBR) binder Licity 2698 X F facilitates the use of silicon contents exceeding 20%. In addition to the established properties of the Licity product family, this binder enables higher capacity, increased number of charge/discharge cycles and reduced charging times.
Key Players
BASF SE, Braskem, China Petroleum & Chemical Corporation, Dow, Evonik Industries AG, Exxon Mobil Corporation, Formosa Plastics Corporation, INEOS, JSR Corporation, LG Chem, LOTTE CHEMICAL TITAN HOLDING BERHAD, LyondellBasell Industries Holdings BV, Reliance Industries Limited., Repsol, Royal Dutch Shell Plc, SABIC, TPC Group, China National Petroleum Corporation
