Acetic Acid – Procurement Best Practices & Sourcing Strategies

DESCRIPTION

Acetic Acid Market Global Size:

Acetic acid market demand is anticipated to grow at 4-5% CAGR by 2026, as this chemical works as a foundation component to produce various adhesives, paints, and coatings. Further, ELINT Market Research’s procurement market research report strives to provide detailed facts and figures for this industry, according to which the acetic acid market global capacity was evaluated at 22.15 MMT in 2023, and its corresponding demand value calculated at 16.92 MMT in the same year.

Market Definition:

Acetic acid is used as a major component in a range of industries, including rubber, plastics, dye, construction, food, beverage, healthcare, and textiles. Further, due to its versatility, this chemical is majorly used in the formation of various other compounds, among which two key compounds include vinyl acetate monomer (VAM) and purified terephthalic acid (PAT). Hence, this procurement report projected that VAM and PAT chemicals utilization will expand at 3-4% CAGR and 5-6% CAGR respectively, and also drive proliferation in the acetic acid industry. Consequently, acetic acid market players are continuously investing in analysis and development activities to be competitive in the vast landscape.

Acetic Acid Market Drivers:

1. Increasing Industrial Demands for Acetic Acid and its Applications –

As acetic acid plays a crucial role in the manufacturing of various chemicals such as solvents, polishes, coatings, etc., its demand in the industrial sector is progressively rising. Hence, the global acetic acid industry experiencing massive growth.

2. Acetic Acid Usage in Various Consumer Goods –

Another major driver for the expansion in the international acetic acid sector is its usage in producing different consumer products, which they use in daily life. For example, vinegar is made of acetic acid, which assists in making different culinary applications, food preservation, sauces, and more. Therefore, consumer items’ widespread appeal adds to the steady requirement for acetic acid.

Acetic Acid Market Challenges:

1. Methanol Production in Asia –

The high production of methanol in Asia can affect the quantity of acetic acid manufacturing since methanol is a key compound to make acetic acid. Hence, large availability of methanol can cause cheaper prices for acetic acid; contrarily, less methanol quantity can drive acetic acid outlay expensive.

2. Environmental Concerns –

Increasing environmental safety concerns force market players to invest more capital to be compliant with stringent regulations, which affects their production and increases costs.

Acetic Acid Market Opportunities:

1. Positive Global Economic Factors –

Positive economic factors such as GDP growth, industrial manufacturing operations, and consumer investments are driving significant opportunities for businesses operating in the global acetic acid procurement intelligence market.

2. Emergence of Different Technological Advancements –

The emergence of technological innovations helping in acetic acid production methods, improving significance, and building eco-friendly goods caused huge opportunities for industry participants.

Acetic Acid Market Segmentation:

1. Application Types –

The foremost segmentation factor for the global acetic acid market is the different applications of this chemical including Butyl Acetate, Vinyl Acetate Monomer, Acetate Esters, Anhydride, Acetic Anhydride, Purified Terephthalic Acid, Ethanol, and more.

2. Key End User Industries –

Food, beverage, plastics, polymers, adhesives, paints, finishes, chemicals, pharmaceuticals, constriction, textiles, etc. are some of the prominent end-user industries of acetic acid.

Regional Outlook for Acetic Acid Market:

The acetic acid industry’s regional outlook showcases diverse countries with significant shares, which occurred as major worldwide suppliers for this chemical. These nations comprise North America at 19%, the EU at 4%, and Asia at 66%. Thus, these numbers exhibit that these territories possess high authority for supply activities of acetic acid goods, and also suppliers can bargain their favorable conditions from purchasers. On the other hand, when it comes to buyer authority, these countries operate at inferior degrees, which means buyers of the acetic acid market experience dominance while trading products.

Types of Engagement in the Acetic Acid Market:

ELINT’s procurement intelligence tools state that diverse worldwide countries contain varied engagements in the global acetic acid market. In this context, the United States emerged as a leader, holding almost 90% of transactions using the spot trading method, which let stakeholders partner for shorter durations with flexible conditions. Furthermore, Europe employs contractual arrangement methods for engagements and holds approximately 70% of transactions; in this approach, buyers and suppliers can engage in long-term agreements with fixed conditions. Lastly, in Asia, around 60% of transactions occurred using the spot-based system, which incorporates short-term and flexible contracts similar to the US. These various interaction models represent the necessity for market participants to modify their strategies to shape geographical market dynamics and choices in the international acetic acid sector.

Price Outlook in the Acetic Acid Market:

When comparing the first quarter of 2023 to the second quarter, the pricing analysis for acetic acid products shows varied numbers in different regions. For instance, Europe occurred as a fundamental domain in the same year and experienced an average 1–2 percent increase in acetic acid expenses, which signifies a moderate level of market conditions. On the other hand, acetic acid goods prices in Asian provinces underwent 6-7 percent growth, which shows that this country executed a higher degree of demand and supply activities for acetic acid compared to Europe.

Impactful Cost Components in the Acetic Acid Market:

Raw materials appeared as the major and impactful cost components, which possess significant shares in the key countries including North America with 56%, the EU with 58%, and Asia with 59%. These percentages reflect the importance of this cost component in the international acetic acid industry. Consequently,  these countries’ market players are required to constantly monitor raw materials prices and decide on acetic acid manufacturing outlay accordingly.

Contract Duration in the Acetic Acid Market:

The average contract duration for buyers and suppliers operating in the global acetic acid industry stays for generally 1 to 2 years. Further, during this timeframe, both parties are allowed to conduct weekly to quarterly price revisions to understand market dynamics. Hence, these revisions help them to foster long-term partnerships.

Key Suppliers in the Acetic Acid Market:

This report contains a thorough study of the competition environment in the global acetic acid market. Thus, business names covered in this study include Celanese​, INEOS (formerly BP Chemicals)​, Jiangsu Sopo​, Chang Chun Petrochemical​, Eastman Chemical​, LyondellBasell​, DuPont​, Azot​, Eurochem​, MSK​, Celanese​, Yankuang Guotai​.