Esters, produced through an esterification reaction between an alcohol and an acid, exhibit a variety of properties, which make them valuable in diverse industries. These versatile compounds find application in industries such as paints and coatings, adhesives and sealants, food and beverages, lubricants, and personal care, thanks to the multiple combinations possible from the abundant choice of acids and alcohols.
The esters market in China, Europe, India, Southeast Asia, and the United States was valued at around USD 22.3 billion in 2022, with China accounting for about 50% of the market, finds our imminent Industrial Esters: Market Analysis and Opportunities report. This significant share can be attributed to China’s prominent role in the production of paints and coatings, and adhesives and sealants, as well as China being the leading producer of Li-ion batteries—both of which contribute to the strong demand for esters in the country.
Acrylic esters, carboxylic acid esters, fatty acid esters, and carbonic acid esters are among the leading ester categories. Collectively, these categories account for nearly 90% of the global esters demand, according to our report. This dominance is primarily attributed to their extensive use in key applications, particularly in the case of acrylic esters, which find their primary application in paints and coatings, as well as adhesives and sealants, while carboxylic acid esters are predominantly employed in food and beverages and personal care.
As most suppliers are focusing on just a few types of esters, the supplier landscape is highly fragmented, with no supplier holding more than a 10% share. Furthermore, the relative ease of ester production has led to the proliferation of local suppliers in Asia, further contributing to this fragmentation.
Several key factors impacting the demand for esters include:
- Environmental regulations: Governments around the world are formulating policies to reduce pollution and promote products that are less harmful to the environment. This is driving the demand for esters due to their environmental friendliness and biodegradable nature. For instance, ester-based lubricants are preferred for their environmental benefits, while less toxic alternatives to phosphate esters are sought in crop protection.
- Inflation: Esters are largely commodity products and have low-profit margins. With high energy costs in Europe and the United States, the supply of esters is likely to shift to Asia. Moreover, lower-priced alternatives may replace esters if the performance benefits do not outweigh the additional costs of using them.
- The Evergrande Crisis in China: The anticipated deceleration in the construction industry is poised to cast a shadow over the paints and coatings industry as well as over the adhesives and sealants industry. As a result, the growth of esters is likely to face impediments, particularly given the scale of esters demand in China. This setback is expected to significantly hamper ester demand globally.
- The rise of Li-ion batteries: As the global demand for electric vehicles is growing, the need for Li-ion batteries is also increasing. Carbonic acid esters, used in electrolyte solvents for these batteries, are experiencing heightened demand.
- Geopolitical issues: The ongoing Russo-Ukrainian conflict and the post-COVID-19 scenario have emphasized the need to be self-sufficient in basic commodities such as food and medicines. This is expected to drive the demand for esters in these industries in individual countries. Furthermore, China’s restrictions on mineral exports necessary for manufacturing computer chips, such as Germanium and Gallium, may adversely impact the demand for esters in the electronics industry.
In light of these factors, our Industrial Esters: Market Analysis and Opportunities report projects the esters market to witness a CAGR of about 3% by 2027. India will lead the growth, as it is expected to emerge as the world’s fastest-growing major economy. Furthermore, the extensive infrastructure development on the horizon is expected to further elevate this demand, particularly within industries such as construction, paints and coatings, and adhesives and sealants, among others.
To seize opportunities in this market segment, refer to our report, which provides a detailed assessment of the market size, competitive landscape, trends, and growth opportunities in key applications—from adhesives and sealants to crop protection, lubricants, and paints and coatings. The report is complemented by an online, interactive database, allowing users to customize views by supplier and excipient.