Industrial growth in Asia is driving the global acetic market with the region accounting for 60% demand in 2011 and China almost 40% demand, states a new report by GBI Research, that adds the industry is expected to grow at a CAGR of 4.7% in future years to reach 15 million tonnes in 2020.

Global demand for acetic acid has been steadily increasing over the past decade, from 6,112,418 tonnes in 2000 to 10,246,522 tonnes in 2011

Acetic acid is an important chemical with applications in several downstream industries like textiles, food processing and several other industrial chemical processes. Acetic acid prices are mainly driven by the prices of feedstock and methanol and demand for its derivatives, including Vinyl Acetate Monomer (VAM), which is used in paints, adhesives and coatings, and Purified Terephthalic Acid (PTA), which is mainly used in the manufacture of polyester and fibres, as well as acetic anhydride and ethyl acetate. An increasing trend in acetate esters being used mainly as solvents for inks, paints and coatings has also been observed in the last few years.

On the technological front, emerging technologies are offering promising opportunities for growth within the chemicals industry. Manufacturers of acetic acid are increasingly updating their processes from older technologies such as the methanol carbonylation process. Next-generation technologies like BP’s Cativa and Celanese’s AO-plus (Acid Optimisation Plus) boast significant savings in variable costs, lower capital costs for the construction of new plants, increased capacity, enhanced production efficiency, reduced energy consumption by approximately 30%, and lower operating costs. An increasing trend towards the adoption of these new technologies is likely to be seen across the world in the coming years, which will drive the global growth of the acetic acid market.

With new capacity coming online in the forecast period, China should continue to be the engine of global acetic acid growth over the next few years, as the emerging economy’s giant population dictates its huge consumption potential and tremendous growth opportunities, while developed nations such as Japan and Germany have seen domestic demand for acetic acid largely stabilize. Asia-Pacific will continue its growth momentum in the coming years, and stands to be the global growth engine for the acetic acid market.

The US had the second-largest acetic acid demand share after China in 2011, and a complete recovery in the US economy will boost the global growth of acetic acid in the future.