Global sales of isobutylene reached USD 24,639.3 million in 2023. The sales are projected to exhibit a year-on-year growth of 5.1% in 2024, reaching USD 25,905.9 million in the year. It is expected to grow at a CAGR of 5.5% from 2024 to 2034, with demand for isobutylene estimated to reach USD 44,193 million by 2034.
The high purity, >99% segment holds the largest share in the isobutylene market at 67.8% and is supported by the expanding demand for higher purity in various applications, such as pharmaceuticals, advanced polymers, and specialty fuels.
The butyl rubber product segment is estimated to hold a share of 66.7% in the isobutylene market in 2024 and is further estimated to fetch substantial growth because of the rising demand in the automotive and tire industries. Butyl rubber possesses excellent air retention characteristics that are highly suitable for tire manufacturing.
| Attributes | Key Insights |
|---|---|
| Estimated Size 2024 | USD 25,905 million |
| Projected Size 2034 | USD 44,193 million |
| Value-based CAGR (2024 to 2034) | 5.5% |
As the world increasingly adopts the use of bio-based fuel additives like bio-ETBE, governments and industries are implementing higher levels of carbon emission reduction steps while phasing down dependence on fossil fuels. Bio-ETBE is created through a chemical reaction between isobutylene and bioethanol, itself a renewable feedstock derived from plant feedstock such as corn or sugarcane.
This trend aligns with global environmental goals, such as those outlined by the European Union's Renewable Energy Directive (RED), which aims to increase the share of renewable energy sources in transportation fuels. In this regard, it is set at having 14% of the total energy to be developed using renewable means by 2030. This presents a massive opportunity for manufacturers aiming to produce bio-based isobutylene derivatives.
Studies have shown that bio-ETBE can reduce GHG emissions by as much as 35-50% compared to its fossil-based analogue. For example, the Horizon Europe program of the European Union finances research and innovation for biofuel technologies under financial aid.
This trend will propagate an upward surge in demand for renewable isobutylene derivatives in the coming years as regulatory support as well as customer demand for cleaner, more environmentally friendly fuels continues to increase.
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Expansion of Fuel Additives Industry Driven by Rising Standards for Cleaner and More Efficient Fuels
Isobutylene, as a feedstock compound, constitutes 65% of the gas feedstock necessary for the production of MTBE. These are the desired fuel components that enhance combustion, increase the efficiency of the fuel and minimize emissions. However, governments are becoming more and more concerned about the environment.
Improving fuel efficiency standards and the introduction of stricter environmental regulations by governments across the world has led to an increase in the demand for fuel additives, which in turn has promoted the growth of the isobutylene market. For example, the USA Clean Air Act Amendments by EPA were passed to make refiners use oxygenates including MTBE in an effort to reduce pollutant emissions that cause smog and this has greatly improved the air quality in large urban areas.
Another significant investment is in fuel additives infrastructure. For instance, replacement of the existing MTBE production capacity would require an investment of USD 2.6 billion to USD 3.8 billion.
The major oil companies are increasing their fuel additives business and investments in such areas have been increased in works, like that Reliance Industries increased MTBE production facility at its Gujarat plant, India. These investments are directly associated with increasing demands for clean fuels to meet the tightened environmental standards in regions like North America, Europe, and Asia.
Growing Demand in Petrochemical Industries: Driving the Isobutylene Market Forward
Isobutylene is an essential feedstock for a whole range of chemical processes in the petrochemical industry. It's necessary to produce butyl rubber, a very crucial product in the manufacturing tires, adhesives, and sealants. Demand for butyl rubber thus goes hand-in-hand with automobile needs as they need high-quality, long-lasting tires to accommodate growing demands.
Isobutylene is used in producing methacrylate, an acrylic building block of materials and coatings applied in construction and automotive finishes and many consumer goods. In other words, investments by governments and private sectors into construction projects provide the demand for these materials, which depend on isobutylene.
New regulations focusing on sustainability and performance are what influence this petrochemical industry to evolve and come up with innovative approaches to meet the demands. This trend increases the consumption of isobutylene and encourages the development of advanced materials that improve efficiency and reduce environmental impact.
Volatility in Crude Oil Prices: A Key Challenge Impacting Isobutylene Production Costs and Market Growth
Isobutylene is sourced from crude oil, the market in this sector is sensitive to changes in oil prices. Isobutylene is produced by catalytic cracking of crude oil; thus, a change in price affects the oil directly impacts it. According to changes in crude oil prices, that of isobutylene increases to make it less lucrative for manufacturers.
For example, chemical product manufacturers like isobutylene producers witnessed a sharp reduction in the production cost of their respective products during 2020 due to crashing oil prices linked to COVID-19 pandemics.
Geopolitical tensions make crude oil prices volatile, as in the case of Russia and Ukraine conflict 2022 for instance, that triggered the disruption of supplying the oil product worldwide. Consequently, the prices of crude rose considerably. Such events increase the cost of manufacturing oil derivatives like isobutylene.
This would again restrict its supply. It is a fact that oil remains the main feedstock for petrochemical production in most regions, and therefore any supply disruption of crude oil or higher prices could delay schedules and cut output, thereby stretching further stressing the market.
Increasing Demand for High-Performance Rubber Boosts Isobutylene Market with the Rise of Electric Vehicles (EVs)
The global shift towards electric vehicles (EVs) is creating significant opportunities for isobutylene, a critical material in the production of butyl rubber. Butyl rubber is extremely important for the production of tires because of its excellent properties, excellent air retention and high durability.
With acceptance levels for electric vehicles rising and the overall number of automobiles increasing, there has been a demand in very long-lasting, high-performance tires. These tires are subjected to higher torque and wear requirements, and the butyl rubber, by implication isobutylene, plays an important role in developing both safe and performance-oriented EV tires.
For instance, Bridgestone and Michelin are making a lot of investment in developing EV-specific tires designed to utilize butyl rubber to help meet high performance specifications. This increase in tire innovation and development has also opened the opportunities for isobutylene, considering the continuing objective of automotive companies to weigh the durability of tires against achieving more light weight, efficient standards.
The global isobutylene industry recorded a CAGR of 2.3% during the historical period between 2019 and 2023. The growth of isobutylene industry was positive as it reached a value of USD 24,639.3 million in 2023 from USD 22,459.8 million in 2019.
The isobutylene market has registered a steady growth between 2019 and 2023. In this period, most significant industry sectors showed a steady rise in demand: automotive, chemicals, and rubber manufacturing industries. Growth factors included the growing demand for tires, the increase in production of high performance fuels, and advancement in polymer usage.
The isobutylene market will expand with significant growth from 2024 to 2034, high demand in key sectors, such as automotive, chemicals, and consumer goods; and continued emphasis on the production of high-performance fuels, specialty chemicals, and advanced rubber products.
Tier 1 companies make a substantial global value capture of 45-50% and earn revenues exceeding USD 500 million. Such leaders are distinguished with high production capacity, various products, large scales of manufacturing and broad-reaching geography clustered with consumers.
Prominent among the Tier 1 companies are Exxon Mobil Corporation, China Petroleum & Chemical Corporation, BASF SE, The DOW Chemical, LyondellBasell Industries Holdings BV, Merck KGaA and, Reliance Industries Limited etc.
Tier 2 companies consist of mid and small sized firms with revenues less than USD 500 million, influencing local economies and holding a regional presence. These companies have strong international operations and industry expertise, adhering to regulatory standards while lacking the cutting-edge technology and extensive global reach of Tier 1 firms. Key players in Tier 2 include Evonik Industries AG, Sumitomo Chemicals, INEOS, TPC Group, and, others.
The section below covers assessments of isobutylene sales across key countries. Countries from East Asia, North America, and Middle East and Africa are anticipated to exhibit promising double-digit growth over the forecast period. All the below-listed countries are collectively set to reflect a CAGR of around 6.3% through the forecast period.
| Countries | Value CAGR (2024 to 2034) |
|---|---|
| China | 6.8% |
| Turkiye | 6.6% |
| KSA | 6.3% |
| India | 6.0% |
| Chile | 5.9% |
China is expected to experience a CAGR of 6.8% from 2024 to 2034, with sales anticipated to reach USD 11,525.5 million by 2034.
It is a crucial segment that is driving the rising demand for isobutylene besides the large growth of commercial and passenger vehicle markets for electric vehicles in China. As the world’s largest automotive market, China produced over USD 27 million vehicles in 2022, according to the Organisation Internationale des Constructeurs d'Automobiles (OICA).
Butyl rubber plays a key role in these tires as it is generated from isobutylene, which is highly considered in terms of its retention of air and heat resistance properties in application to commercial vehicles that are exposed to long hours of operation and various road conditions.
The accelerating urbanization and industrialization in China has also fueled demand for passenger cars. These automobiles need high-quality, long-lasting tires with butyl rubber to ensure safety and performance parameters.
Isobutylene is an important input in the production of such durable tires, hence is an important material in the country's automobile supply chain. The high-quality tires supported by the rise in road infrastructure of China and rising vehicle ownership have further triggered the demand in the market for isobutylene.
The Kingdom of Saudi Arabia (KSA) is projected to grow at a CAGR of 6.3% from 2024 to 2034, with sales anticipated to reach USD 449.6 million by 2034.
Isobutylene plays an important role in the production of polyisobutylene (PIB), which is one of the key materials for lubricants, sealants, and adhesives. The chemicals and petrochemicals industry in Saudi Arabia has a high investment in this segment to diversify its product lines based on the Vision 2030 economic strategy. Such excellent thermal stability, low permeability, and extremely high viscosity make polyisobutylene very valuable in industrial applications.
Saudi Arabian Petrochemical companies, led by SABIC, are upgrading their productions of PIB as demand for this market grows throughout the world. This trend will surely push the growth in isobutylene market supported by need for high-quality lubricants and sealants across industrial and construction sector.
Saudi Arabia, with its massive crude oil and natural gas reserves, aims to continue its dominance in the petrochemical sector in the production of isobutylene and its derivatives, such as polyisobutylene. Saudi Arabia is the primary supplier of PIB to industries for application on products used in engine oils and transmission fluids, among others.
Saudi Arabia, with its currently increased production capacity of isobutylene, well-positioned to capture a significant share in the global market with anticipated 3.4% CAGR in the worldwide industrial lubricants market in 2022 through 2030.
In the forecast period, India’s isobutylene industry is expected to grow steadily at a CAGR of 6.8%, reaching a total value of USD 3,963 million by 2034.
India’s pharmaceutical industry which is one of the largest globally is another reason for the increasing demand of isobutylene. India has emerged as a leading supplier in the pharmaceutical sector for generic drugs and vaccines. This sector is booming with estimated figures of USD 50 billion in 2020 to over USD 130 billion by the year 2030, based on official estimates.
Causative of this growth is the increase in the requirement for essential pharmaceutical packaging components like butyl rubber derived from isobutylene. Use of butyl rubber is maximized for stopper for vials, seals, and other drug packaging components because it is thermoplastic and is highly resistant to contaminants. India’s pharmaceuticals industry is enlarging day by day and so the demand of these materials will be very high.
The worldwide vaccine and injectable medicine market will also expand in the following years, which will in turn fuel the requirement for high-quality pharmaceutical packaging materials, a trend that has also been accentuated by the COVID-19 outbreak.
With its position as a supplier of nearly 40% of the world’s vaccines, the demand for high-performance materials, including butyl rubber, in the packaging and shipping of temperature-controlled medical equipment remains substantial, driving growth and innovation in this critical sector. Butyl rubber polymers also contain Isobutylene as a building block in manufacturing structures due to its outstanding barrier qualities that safeguard the medicament against contamination and deterioration.
India’s export-driven pharmaceutical sector plays a crucial role in global healthcare, with Indian companies supplying over 50% of the world’s vaccines. This massive export demand places additional pressure on pharmaceutical packaging solutions, reinforcing the need for durable and reliable materials like butyl rubber. As pharmaceutical companies in India ramp up production to meet both domestic and international demand, the isobutylene market is poised for continued growth.
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The section explains the growth trajectories of the leading segments in the industry. In terms of product type, the High Purity, 99%> category will likely dominate and generate a share of around 67.8% in 2024.
Based on Source, the synthetic segment is projected to hold a share of 92.7% in 2024. The analysis would enable potential clients to make effective business decisions for investment purposes.
| Segment | High Purity, 99%> (Product Type) |
|---|---|
| Value Share (2024) | 67.8% |
The use of high-purity isobutylene (>99%) is favored in various industries due to its superior performance in applications where precision and consistency are critical. In the pharmaceutical sector, high-purity isobutylene is essential for producing pharmaceutical-grade butyl rubber, which is used in medical packaging, such as vial stoppers and seals.
The high purity ensures that the rubber offers maximum impermeability and resistance to contamination, which is vital for maintaining the sterility of injectable medicines and vaccines. With global pharmaceutical demand on the rise, especially for safe, sterile packaging, high-purity isobutylene is becoming increasingly important
In addition to the pharmaceutical sector, automotive and plastics industries also rely on high-purity isobutylene. The high-purity version of isobutylene allows for better quality control and performance, particularly in electric vehicle (EV) tires, which demand greater durability and longevity. In the plastics industry, high-purity isobutylene is crucial in the production of advanced polymers, where impurities can lead to material defects or reduced functionality.
| Segment | Synthetic (Source) |
|---|---|
| Value Share (2024) | 92.7% |
In addition to its significant role in the pharmaceutical and automotive industries, synthetic-based isobutylene is increasingly being used in other sectors like construction, consumer goods, and industrial applications. In construction, synthetic isobutylene derivatives, such as polyisobutylene (PIB), are used in sealants, adhesives, and roofing membranes.
These materials are highly valued for their ability to withstand extreme weather conditions, resist UV radiation, and provide long-term durability. The demand for high-quality sealants in construction projects, especially in infrastructure development, is boosting the need for synthetic isobutylene-based products.
The consumer goods industry also benefits from synthetic isobutylene, particularly in the manufacturing of packaging materials and personal care products. Isobutylene is used in making plastics and other polymers that provide strong, flexible, and airtight packaging.
This is especially important for the storage of sensitive consumer goods, such as food and beverages, where durability and contamination prevention are key. In the personal care industry, polyisobutylene is used in the production of cosmetics, adhesives in bandages, and other products that require safe, skin-friendly materials.
The section provides comprehensive assessments and insights that highlight current opportunities and emerging trends for companies in developed and developing countries. It analyzes advancements in manufacturing and identifies the latest trends poised to drive new applications in the market.
A few key players in the isobutylene industry are actively enhancing capabilities and resources to cater to the growing demand for the compound across diverse applications. Leading companies also leverage partnership and joint venture strategies to co-develop innovative products and bolster resource base.
Significant players are further introducing new products to address the increasing need for cutting-edge solutions in various end-use sectors. Geographic expansion is another important strategy that is being embraced by reputed companies. Start-ups are likely to emerge in the sector through 2034, thereby making it more competitive.
Industry Updates
In terms of Grade, the industry is divided into High Purity, 99%>, and Low Purity, <99%.
In terms of Grade, the industry is divided into Synthetic, and Bio-based.
In terms of Grade, the industry is divided into Butyl Rubber, Polyisobutylene (PIB), Fuel Additive, Isoctane, and Others.
Key countries of North America, Latin America, Western Europe, Eastern Europe, East Asia, South Asia, Middle East and Africa (MEA), have been covered in the report.
The global market was valued at USD 24,639.3 million in 2023.
The global market is set to reach USD 25,905.9 million in 2024.
Global demand is anticipated to rise at 5.5% CAGR.
The industry is projected to reach USD 44,193 million by 2034.
| Market Size (2023) | USD 115,306.8 thousand |
|---|---|
| Projected Value (2033) | USD 361,225.6 thousand |
| Expected Value CAGR (2023 to 2033) | 12.1% |
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