Global Dimethyl Ether Market: Snapshot
The dimethyl ether market is the largest in Asia-Pacific region, specifically China. The companies, China Energy Limited (Singapore) and Jiutai Energy Group (China) are dominant players in the Asia-Pacific region. The market for DME is expected to grow during the forecast period on account of its use in LPG blending. DME is extensively used by aerosol propellant. The capacity for fuel has increased in Asia Pacific and this is expected to continue to grow steadily, on account of the increasing establishment of new plants for sufficient domestic fuel supply. Asia Pacific is the most populated region worldwide and thus, the demand for fuel substitutes such as dimethyl ether is highest from this region. Countries such as Indonesia, Japan, and South Korea, are fueling the growth of the DME market, apart from China, which is the largest contributor.
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Use of DME in LPG Blending to Remain Key Driver for Market
The various applications of DME studied in the report are: LPG blending, aerosol propellants, transportation fuel, industrial, and others which comprise chemical feedstock among others. Of these, the LPG blending segment is anticipated to lead in the market. The scarcity of LPG is a growing concern gripping countries that have inadequate gas reserves or insufficient supply to meet the high demand from growing population. DME has emerged as a boon for such countries as it reduces the dependency on LPG imports. LPG imports are reduced by blending 20% DME with LPG, which is then used for cooking, fueling the growth of the market. DME is blended in LPG and requires no change in the infrastructure and has emerged efficient, thus driving the market to a large extent.
DME as Potential Transport Fuel to Create Growth Opportunities
With little alterations in the fuel injection systems, DME has promising potential to be used in conventional engines as transport fuel in place of diesel. This is expected to create immense growth potential for the market and players will benefit from the opportunities offered by DME in the transport sector. The global dimethyl ether market will witness a rapid growth in the years to come on account of its clean combustion properties. The growth in the automobile industry will push the DME market in China. With easy and abundant coal reserves in China, the market will flourish in the country. The market is expected to receive boost from favorable regulations set by governments regarding emission control for environmental conservation, which will compel the use of cleaner fuels such as DME.
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Lack of Export Infrastructure to Limit Growth Opportunities for DME Market Players
One of the key challenges of this market is the lack of proper export infrastructure which is dampening the growth of the market. Despite the high demand for DME from various countries, the lack of trade norms is acting as a major hurdle for the growth of this market. Due to these two constraints, the compound is seldom exported to countries, negatively impacting the global DME market. Another hurdle in the market is the small plant capacities. This has compelled players in the DME market to operate their plants at much lower rates. The impact of this restraint is estimated to reduce in the years to come as government strives hard to overcome the challenge. This is expected to help the markets in China, Papua New Guinea, and Saudi Arabia.