Dimethyl Ether Market to Hit Sales of $8.92 Billion by 2028 | India, Germany, and US are the Largest Exporter of Dimethyl Ether | SkyQuest Technology

SkyQuest Technology Consulting Pvt. Ltd.
SkyQuest Technology Consulting Pvt. Ltd.

Global dimethyl ether market was valued at USD 4.59 billion in 2021, and it is expected to reach a value of USD 8.92 billion by 2028, at a CAGR of more than 9.95% over the forecast period (2022- 2028).

Westford, USA, Dec. 09, 2022 (GLOBE NEWSWIRE) -- Dimethyl ether (DME) is a versatile gas that can be used as a transportation fuel, chemical feedstock, or refrigerant. It is also one of the cleanest-burning fuels available, with very low emissions of carbon dioxide, nitrogen oxides, and sulfur dioxide. Our analysis of the global dimethyl ether market finds that the transportation sector will be the largest market for DME, accounting for 60% of demand by 2028. Rising demand for cleaner-burning fuels will drive growth in the aviation and maritime sectors, while the use of DME as a replacement for diesel fuel in trucks and buses will increase its appeal as a transportation fuel. The chemical sector will be the second-largest market for DME, accounting for 30% of demand by 2028. DME can be used as a feedstock to produce a wide range of chemicals, including solvents, adhesives, and pharmaceuticals.

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As per our study, three primary forces that are shaping the dimethyl ether market namely the push for less-polluting power generation, the need for better performing chemicals, and regulatory changes.

  • The push for less-polluting power generation: As global power demand continues to rise, so does the pressure to find cleaner, less polluting ways to generate electricity. One promising solution is dimethyl ether (DME), which can be used as a fuel in gas turbines and diesel engines. DME produces significantly lower emissions than traditional fossil fuels, making it an attractive option for power generators looking to reduce their environmental impact.

  • The need for better performing chemicals: Dimethyl ether is also used as a feedstock in the production of several important chemicals, including methyl tert-butyl ether (MTBE) and ethylene glycol in the global dimethyl ether market. These chemicals are used in a variety of applications, such as gasoline additives and antifreeze. As global demand for these products grows, so does the demand for DME.

  • Regulatory changes: Recent changes in environmental regulations are also driving demand for DME. In particular, the European Union's decision to phase out MTBE has created an opportunity for DME to replace it as a gasoline additive. This shift is already underway in some countries, and is expected to increase in the coming years.

SkyQuest's analysis of the dimethyl ether market is comprehensive and provides valuable insights into this burgeoning market. The study includes an in-depth analysis of the economics of dimethyl ether production, along with a detailed examination of the market drivers and key players in the industry. The study finds that dimethyl ether has the potential to be a major player in the global energy market, due to its low cost of production and its many applications. We forecast that the market will grow rapidly in the coming years, as demand for this versatile product increases.

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Consolidation of Dimethyl Ether Market is Approaching at an Unpreceded Rate 

As a result of our analysis, we believe that the dimethyl ether market is currently in a period of significant change and will continue to undergo transformation in the coming years. In particular, we expect consolidation among producers, as well as continued development of new applications and markets. The current dimethyl ether (DME) industry landscape is characterized by a large number of small-scale producers, who collectively account for a little over 1% of global ethylene capacity. There are also several medium-sized producers who have between 2% and 5% of global ethylene capacity. The largest player in the industry, Saudi Aramco, has over 20% of global ethylene capacity.

While the dimethyl ether market has been around for over two decades, it has only recently begun to see significant growth. This is due in part to the increased use of DME as a replacement for diesel fuel in a number of applications, including transportation and power generation. In addition, DME can be used as a feedstock for the production of other chemicals, such as propylene and butadiene. As the market for DME continues to grow, we expect to see consolidation among producers. This consolidation will likely take the form of merger and acquisition activity, as well as joint ventures and other alliances. The rationale for this consolidation is twofold. First, consolidating will allow producers to achieve cost synergies and improve economies of scale. Second, consolidation will enable producers to better compete against.

Our analyst attributes this potential of the global dimethyl ether market to the expectations for China's DME market, which is projected to experience "robust growth" in the wake of the country's implementation of strict environmental regulations. Despite these promising prospects, the report notes that the current DME industry is "fragmented and slightly profitable," with Structure, scale, and cost challenges currently hindering the market's development. In order to overcome these challenges and realize its potential.

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SkyQuest recommends that companies in dimethyl ether market focus on three key areas:

  • Developing an efficient production process: This involves finding ways to reduce the costs of production, such as by optimizing feedstock utilization and minimizing energy consumption.

  • Expanding capacity: This will be necessary to meet the expected demand from China and other markets.

  • Improving margins: This can be done by developing new applications for DME and by increasing adoption of the fuel in existing markets.

Global Production: Germany, India, US, and China are largest Exporter in Global Dimethyl Ether Market  

In its latest market research report, SkyQuest has forecasted that dimethyl ether market will grow at a compound annual growth rate (CAGR) of 9.95% between 2022 and 2028. This growth is being driven by the rising demand for DME in Asia, specifically in China and India. The global production of DME grew from 8.6 million tons in 2019 to 9 million tons in 2021. In 2022, production is expected to reach 9.3 million tons. Between 2022 and 2028, SkyQuest projects that global DME production will grow at a CAGR of 8.5%, reaching 15.93 million tons by 2028.

The report on the dimethyl ether market found that Germany, India, US and China are the largest exporters of DME, accounting for a combined market share of 70%. These countries have well-developed manufacturing capabilities and favorable policies that have encouraged the development of the DME industry. The United States is also the largest importer of DME, accounting for 27% of global imports. The country has seen strong growth in demand for DME due to its use as a clean burning fuel for vehicles. Bain's analysis shows that the DME market is poised for strong growth in the coming years. The expansion of the middle class in developing countries, coupled with increasing environmental regulations, will continue to drive demand for DME.

Top Players in Global Dimethyl Ether Market

  • Mitsubishi Corporation

  • Grillo Werke AG

  • Ferrostal GmbH

  • China Energy Limited

  • Zagros Petrochemical Company

  • Oberon Fuels

  • Jiutai Energy Group

  • Royal Dutch Shell Plc.

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