The glycerol market by source is categorized into three main categories, which are fatty acids, biodiesel, and fatty alcohols. Glycerol, the organic compound is mostly obtained as a byproduct from the biodiesel production process via transesterification and esterification reactions. In 2011, around 66.2 percent of the total glycerol was obtained from the biodiesel industry, due to the transesterification reaction process.
Development of the global biodiesel market in the past few years has led to an oversupply of glycerol worldwide. In the next five years, the glycerol supply from the biodiesel production process is anticipated to surge due to the high penetration of biofuels for mainstream applications. Other sources of glycerol are fatty alcohols, fatty acids, and the saponification process. The supply dynamics of the glycerol market by source seem favorable at present.
Glycerol Market by Production Source and Applications
Glycerol is also known as glycerin, and it is widely used in several pharmaceutical formulations. Here are the different glycerol sources in detail with the various applications.
Glycerol Market by Source
The main source of glycerol/glycerin is the biodiesel production. Lipids extracted from feedstock of oil plant are composed of fatty acids, acylglycerols, and other bioactive substances. These fatty acids are released to fatty acid methyl esters by the reaction of hydrolysis. This process results into glycerol, which is usually around ten percent of the volume, but varies depending on the lipid feedstock. Apart from the biodiesel production, glycerol is also obtained as a byproduct from the soap making process.
Glycerol is used in the manufacturing of some household products such as skin moisturizers to explosives such as dynamite. Glycerol market finds its application in many industries such as pharmaceuticals, personal care, foods and beverages, alkyd resins, tobacco humectants, polyether polyols, and others such as textile, explosives, paper, etc.
Global Glycerol Market by Source Overview
According to a market intelligence agency, Asia Pacific is the dominant consumer of glycerol and it accounted for 36% of the total glycerol consumption in the year 2011. China, the fastest growing economy along with India has rapidly changing consumer lifestyle which makes them two major countries in Asia Pacific that attribute to the increasing demand for glycerol.
Glycerol Market Forecast
The market intelligence agency also stated that the global demand of glycerol by source in the year 2011 was 1,995.5 kilo tons, and it will grow during the forecast period of 2012 to 2018 by 6.3% CAGR and amount to 3,060.4 kilo tons by the year 2018. In relation to market revenue, glycerol market demand is estimated to reach USD 2.1 billion with a growth of 7.7% CAGR during the forecast period.
Additionally, pharmaceuticals and personal care industry are the key application sectors that accounted for over 37% of the total glycerol consumption in the year 2011. Food and beverages industry on the other hand, is projected to be the fastest growing market for glycerol with a growth of 7.3% CAGR during the period of 2012 to 2018.
The global glycerol market by geography is segmented into four main zones which are North America, Asia Pacific, Europe, and Rest of the World. The global glycerol market by source is dominated by South East Asian (mostly Malaysian) companies which are Kuala Lumpur Kepong Berhad, IOI Group, Wilmar International, and Oleochemicals.
Two of the major market drivers are growth of major end-use industries and the growing demand for renewable chemicals. However, there exist two factors which tend to constrain the glycerol market’s growth which are the low profit margins in terms of glycerol refiners and uncertainty of feedstock supply.
The glycerol market by source will witness a growth of 7.7% CAGR during the forecast period of 2012 - 2018, due to opportunities arising from the novel application of glycerol and upcoming methods for production of feedstock.