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This report provides an assessment of the supply/demand situation for butylenes in 2007 and market projections for 2012. The focus of the study is the worldwide butylenes market, an evaluation of the worldwide supply of butylenes, and the consumption of butylenes for producing chemicals and gasoline blending components where data are available.
Butylenes are four-carbon mono-olefins that find use in fuel and chemical applications. Fuel markets account for about 90% of the world production of butylenes. The major fuel application is in the manufacture of gasoline blending components, such as gasoline alkylate, polymer gasoline and dimersol. Isobutylene serves as a raw material for the oxygenates, methyl tert-butyl ether (MTBE) and ethyl tert-butyl ether (ETBE), as well as for iso-octane. Butylenes may also be blended directly into gasoline for volatility control. They are also marketed with propane and butanes as liquefied petroleum gas (LPG).
At about 10% of the total worldwide market for butylenes, the size of the chemical market pales in comparison to that of the fuel market. n-Butenes are used as the precursor for sec-butyl alcohol, butadiene, butene-1 and other smaller applications. In the United States, Western Europe and Japan the chemical market for n-butenes is growing slowly; however, in developing regions, demand for butene-1 as a polyethylene comonomer and sec-butyl alcohol for MEK remain high. Environmental regulations have slowed the growth of chemical markets for isobutylene in the United States and Japan with the gradual cessation of MTBE use in reformulated gasoline. Japan ceased MTBE production in 2001, while the United States will most likely end by 2013. Other isobutylene derivatives such as butyl rubber and polybutenes in these regions are mature markets and will see only small growth. Stronger isobutylene demand in Other Asia, Central and South America, and Central and Eastern Europe is forecast through 2012.
The following pie charts show world consumption of butylenes for fuel uses and for chemical uses.
In the United States, chemical demand for n-butenes is expected to remain relatively stagnant during 2007–2012 despite moderate growth for butene-1. A projected decline in sec-butyl alcohol production and the mature nature of the market for plasticizer alcohols produced from heptenes and octenes will lower overall demand. In addition, the production of propylene via metathesis, currently operating near capacity, is expected to decline with the decline in domestic demand for polypropylene. Isobutylene consumption growth for all chemical derivatives (excluding MTBE) is expected to grow only slowly; consumption for MTBE continues to decline. Isobutylene consumption for MTBE declined significantly during 2000–2007, and is expected to continue to do so during the 2007–2012 period, potentially eliminating all MTBE production throughout the United States.
Western European consumption of n-butenes for chemical use will grow well, while isobutylene use (excluding MTBE) will decrease slowly during 2007–2012. The use of isobutylene for MTBE/ETBE production will remain level. The use of isobutylene for ETBE is expected to grow faster and offset declines in MTBE demand.
Japan’s chemical markets for n-butenes will grow strongly and for isobutylene very slowly during 2007–2012. Since August 2004, n-butene demand for propylene production via butylene metathesis quadrupled to 2007, but will slow over the forecast period. MTBE production in Japan for gasoline began in 1992 and peaked in 1999. Refiners discontinued production of MTBE and mixing MTBE in gasoline in mid-2001 after MTBE was found in groundwater. Future isobutylene growth will come from butyl rubber, methyl methacrylate and diisobutylene demand.
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