The global and China market for dimethyl ether is a moderately fragmented arena. Transparency Market Research (TMR) observes in a new study that the raft of opportunities created by the transportation and power segment is likely to attract new players to venture into the market, intensifying the competition in the coming years. In order to ensure sustainable operations, several manufacturers are shifting towards natural gas from coal to manufacture methanol, which is further converted to dimethyl ether.
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“With more conducive factors in China, the majority of players are focusing towards expanding their business in the country,” says the author of the report. Some of the prominent companies operating in the global and China dimethyl ether market are Korea Gas Corporation, Shenhua Ningxia Coal Industry Group Co. Ltd., Jiutai Energy Group, Guangdong JOVO Group Co. Ltd., and China Energy Ltd. The global dimethyl ether market is anticipated to reach US$8.37 bn by 2020, expanding at a CAGR of 9.4% from 2014 to 2020.
LPG Blending Remains Most Prominent Application Segment Owing to Growing Demand from China
On the basis of application, the LPG blending will continue to account for the lion’s share in the market until 2020. Strong demand for LPG in China is largely supplementing the growth of the segment. However, the demand for dimethyl ether in the transportation sector is expected to follow an exponential growth track. The clean burning and low carbon emission properties of dimethyl ether make them an attractive option as a transportation fuel. Moreover, increasing research and development activities in the field of fuels for transportation is propelling the growth of the transportation fuel segment. Owing to these factors, the segment will post a CAGR higher than any other segment during the review period.
Geographically, China will represent a substantial share in the market throughout the forecast period, owing to the rapidly growing population. The country will be trailed by rest of Asia Pacific, Europe, and North America. The dimethyl ether market in Rest of the World is estimated to register a noteworthy CAGR in terms of revenue during the same period. On the other hand, China will progress at a CAGR higher than any other region in terms of volume during the review period.
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Rising Environment Concerns Regarding Use of HFC and HCFC Trigger Demand
The spiraling demand for LPG blend in Asia Pacific, particularly China, is one of the primary stimulants of the growth of the global dimethyl ether market. “With the similar properties of dimethyl ether and LPG, accurate proportion blend of the two chemicals becomes convenient,” says a TMR analyst. “The increased uptake of LPG blend has proved to be helpful in reducing China’s import burden significantly.”
Moreover, dimethyl ether is used to manufacture environment-friendly aerosol propellant, which acts as an alternative to hydrofluorocarbons (HFC) and hydrochlorofluorocarbon (HCFC). The rising concerns regarding environment conservation and safety are, therefore, playing a vital role in the growth of the market.
Stringent Government Regulations Pertaining to LPG Blending Hampers Growth Prospects
Dimethyl ether, as an individual unit, is unable to provide the viscosity and lubricity required for a fuel. This, in turn, has a negative impact on the growth of the global market. It provides value when blended in correct proportion with other fuels, such as diesel. However, several governments worldwide have set stringent regulations pertaining to blends. The growth of the market is restricted by the strict regulatory scenario regarding blending of dimethyl ether in domestic LPG cylinders in its most prominent region, China. However, the increasing demand for transportation fuel will stir up the uptake of dimethyl ether in the near future.
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The above data has been derived from a report by TMR, titled “Dimethyl Ether Market (Raw Material - Fossil Fuel Based and Bio Based; Application - LPG Blending, Aerosol Propellants, Transportation Fuel, Industrial and Chemical Feedstock) - Global & China Industry Analysis, Size, Share, Growth, Trends and Forecast 2014 - 2020.”
The report segments the global dimethyl ether market as:
Dimethyl Ether Market, by Application
- LPG blending
- Aerosol propellants
- Transportation fuel
- Others (Including chemical feedstock, etc.)
Dimethyl Ether Market, by Raw Material
- Fossil fuel based DME
- Bio based DME
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