Market Overview
The global market for Cellulose Ethers is expected to witness significant growth at a CAGR of 10% during the forecast period (2023-2030).
Cellulose ether is a polymer obtained by chemically mixing and reacting with etherifying agents such as ethylene chloride, propylene chloride, and ethylene oxide as the main raw materials. These are cellulose polymers that have undergone an etherification process. Cellulose ethers are used in a variety of applications including thickening, bonding, water retention, personal care products, construction materials, textiles and oilfield compounds. Performance, availability and ease of formulation modification are factors to consider when selecting the exact product to use.
Market Dynamics
Surging demand for cellulose ethers from the food and beverage industry is expected to boost the cellulose ethers market over the forecast period. However, volatility in raw material prices can be a major market restraint.
Growing demand for cellulose ethers in the food and beverage industry
Cellulose ethers are used as gelling agents in food mixtures, thickeners in pie fillings and sauces, and suspending agents in fruit juices and dairy products. In the food and beverage industry, cellulose ethers are used as fillers in binders in the manufacture of jams, sugar, fruit syrups and mustard cod roe. It is also used in various dessert recipes as it imparts an even and fine structure and a beautiful appearance.
Various regulatory agencies encourage the use of cellulose ethers as food additives. For example, hydroxypropylmethylcellulose, hydroxyethylcellulose, and carboxymethylcellulose are permitted as food additives in the US, EU, and many other countries. The European Union emphasizes that L-HPC and hydroxyethyl cellulose can be used as approved thickeners and gelling agents. Methylcellulose, hydroxypropylmethylcellulose, HPC, HEMC and carboxymethylcellulose have passed the verification of the Joint FAO/WHO Expert Committee on Food Additives.
The Food Chemical Codex lists carboxymethylcellulose, hydroxypropylmethylcellulose, and ethylcellulose as food additives. China has also formulated quality standards for carboxymethyl cellulose for food. Food grade carboxymethyl cellulose has also been recognized by Jews as an ideal food additive. Growth in the food and beverage industry coupled with supportive government regulations is expected to drive the global cellulose ethers market.
Changes in raw material prices
Various raw materials such as cotton, waste paper, lignocellulose, and sugar cane are used to make powdered cellulose ether biopolymers. Cotton linters were first used as raw materials for cellulose ethers. However, affected by various factors such as extreme weather, the production of cotton linters showed a downward trend. The cost of linters is rising, affecting the profit margins of cellulose ether manufacturers in the long run.
Other raw materials used to produce cellulose ethers include wood pulp and refined cellulose of plant origin.
Fluctuating prices of these raw materials are expected to be an issue for cellulose ester manufacturers due to downstream demand and off-the-shelf availability. In addition, the cellulose ethers market is also affected by higher transportation costs due to rising fuel prices and higher manufacturing costs due to rising energy costs. These facts also pose risks to cellulose ether manufacturers and are expected to reduce profit margins.
COVID-19 Impact Analysis
Cellulose ethers had a huge market even before COVID-19, and their properties prevented them from being replaced by other cheaper alternatives. Additionally, availability of manufacturing-related raw materials and low manufacturing costs are expected to drive the cellulose ethers market.
The outbreak of COVID-19 has reduced cellulose ether production at several manufacturing plants and reduced construction activities in major countries such as China, India, US, UK, and Germany. The decline was due to disruptions in supply chains, shortages of raw materials, reduced demand for products, and lockdowns in major countries. The construction industry has a major influence on the cellulose ethers market. The most widely publicized impact of COVID-19 has been severe labor shortages. China’s construction industry relies on migrant workers, with 54 million migrant workers working in the industry, according to China’s National Bureau of Statistics. Migrant workers who returned to their hometowns after the closure of the city could not resume work.
According to a survey of 804 companies conducted by the China Construction Industry Association on April 15, 2020, 90.55% of the companies answered “progress is blocked”, and 66.04% of the companies answered “labor shortage”. Since February 2020, the China Council for the Promotion of International Trade (CCPIT), a quasi-government body, has issued thousands of “force majeure certificates” to protect Chinese companies and help them deal with issues with overseas partners. to Chinese companies. The certificate established that the blockade took place in a specific province of China, supporting the parties’ claim that the contract could not be performed. The demand for cellulose ethers in 2019 is expected to be similar to that before the COVID-19 epidemic due to increased demand for thickeners, adhesives, and water retaining agents in the construction industry.
Cellulose ethers are used as stabilizers, thickeners, and thickeners in the fields of food, pharmaceuticals, personal care, chemicals, textiles, construction, paper, and adhesives. The government lifted all business restrictions. Supply chains are returning to a normal pace as needed goods and services are produced.
Asia Pacific is expected to witness rapid growth over the forecast period. The cellulose ethers market in the region is expected to be driven by rising construction spending in China and India and increasing demand for personal care, cosmetics, and pharmaceuticals in the coming years. The Asia Pacific market is expected to benefit from increasing cellulose ether production in China and increased capacity of local producers.