Global Market Outlook on Glycerin

Global glycerin market is expected to reach $3.12 billion by 2021 with a CAGR of 3.12 percent .Currently, it is a tight market, and the trend is uncertain with changes in policies of anti-dumping duties for biodiesel market in the US and the EU. The US domestic production has increased, and the EU imports are witnessed to increase this year

The market is highly concentrated, as top 5 – 6 participants accounted for over 65 percent of the total demand in 2014. Key market players include IOI, KL Kepong, Oleon, Wilmar, ADM, P&G, and Emery

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  • Crude glycerin procurers should engage with two to three large-scale producers in order to ensure supply sustainability and adherence to the desired quality specifications and standards
  • The UK refined glycerin prices are dependant on biodiesel mandates and moving crude oil price. The prices were forecasted to decline from January 2018. Hence, a contract price during October –December 2018 could have benefited the buyers by nearly 1 percent
  • Prices are expected to decline from April to October 2018, and hence spot buying prices are preferred post October 2018
  • Three-month contract in November 2018 would save 1 – 1.5 percent compared to spot buying forecasted prices

Glycerin Value Chain

Glycerin is derived as a by-product from various production process, such as biodiesel, soap, fatty acid, and alcohol. Hence, glycerin supply is largely determined by the global demand of biodiesel and fatty acids/alcohols

Global Supply–Demand Analysis

Biodiesel is the largest industry source for glycerin, with more than 60 percent share to the global glycerin supply, followed by fatty acids (24 percent). Higher biodiesel blending mandates in the EU and blenders’ tax credit in the US have led to their leading positions among the global biodiesel producers

Market Outlook - 2016/17

  • Regulatory policies promoting the production of biodiesel across countries led to increased production of biodiesel in the recent decade. Thus, the biodiesel industry emerged as the largest contributor to the global glycerin supply 
  • Biodiesel production displayed a tremendous annual growth rate of 37 percent during 2007–2011. However, sharp expansion of biodiesel production has been arrested during 2011–2013, at 6 percent, due to lower crude oil prices and non-viable biodiesel production

Global Supply–Demand Analysis

Europe and China are the leading contributors to the global glycerin consumption, with increasing use of crude glycerin in disposal applications and refined glycerin in ECH production

Glycerin Global Demand by Application (2017)

  • Glycerin production is a by-product of saponification process, which has decreased in the recent days. This is because of the increasing consumer preference for shower gels in developed countries and predominant usage of fatty acids to produce soaps in the developing countries
  • Synthetic production of glycerin is negligible, and Dow Chemical is the only manufacturer of synthetic glycerin, shut down its £140 million plants, when the prices dropped to unprofitable levels

Glycerin Consumption by Country

  • Higher consumption of glycerin in the EU and the US is mainly because of the growing crude glycerin usage in disposal applications, alongside the growth in demand from personal care industry
  • Along with the larger markets, like personal care and food industry, the glycerin demand from the small segments, like alkyd resins, polyether polyols, and tobacco, are expected to grow at 3 – 4 percent every year