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COVID-19 Outbreak Pinched Demand for Premium Gasoline Leading to Alkylate Price Drop

The New York Harbor has been less thirsty for alkylate flowing from India’s Reliance refinery during the COVID-19 outbreak. Such trends are affecting the expansion of the India alkylate market. The pandemic has been responsible for pinching the demand for premium gasoline, leading to a price drop for alkylate and squeezing the octane spread. Excess supply and thin blending margins for premium RBOB (Reformulated Gasoline Blendstock for Oxygen Blending) are affecting the growth of the alkylate market.

Suppliers were putting excess alkylate in storage during the peak of the coronavirus outbreak in April with plans to remain stored until summer 2021. Moreover, refineries have been functioning in a staggered manner following which, there has been a slowdown in alkylate flows. As such, mass inoculation using COVID-19 vaccines and robust financial planning of business activities are anticipated to revive market growth in Q3 and Q4 of 2021.

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Advanced Sulfuric Acid Alkylation Prevents Side Reactions during Motor Gasoline Blending

The global alkylate market is estimated to clock a sluggish CAGR of ~2% during the forecast period. This is evident since manufacturers are challenged with side reactions during high-octane blending of motor gasoline. Hence, manufacturers such as Lummus Technologies, a leading licensor of proprietary petrochemicals, refining and gas processing technologies, is introducing its CDAlky® gasoline alkylation technology, which prevents side reactions during high-octane blending of motor gasoline.

Companies are increasing their R&D in advanced sulfuric acid alkylation processes that also reduce acid consumption rates during high-octane blending of motor gasoline.

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New Facilities Conduct Research to Produce High Quality Alkylate from 100% Isobutylene Feed

Investments in new production capacities are contributing toward the growth of the alkylate market, which is predicted to reach a valuation of US$ 99.4 Bn by the end of 2031. Hengli Petrochemical - a company engaged in the supply and trading of crude oil, petroleum, and petrochemical products, has announced to start its new 300 Kmta Stratco alkylation unit in China, which is licensed by the Dupont Clean Technologies. Such developments are helping companies to produce high quality alkylate from 100% isobutylene feed.

Alkylate is gaining popularity as a key component in clean and high-octane gasoline from 100% isobutylene feed stream. Manufacturers in the alkylate market are gaining a strong research base in techniques that maximize product octane and minimize end-point with this feedstock.

New Solid Acid Catalyst Technology Replacing Hydrofluoric Acid Alkylation

Globally, the demand for cleaner burning gasoline blend components is increasing, while the overall demand for gasoline is declining. Companies in the alkylate market are capitalizing on this opportunity to develop a new solid acid catalyst technology, which is outperforming liquid acids. This has led to the popularity of ExSact catalyst, which forms the core of a safe and efficient K-SAAT process that generates high-octane alkylate.

Alkylate, isomerate, ethanol, and ethers represent the cleaner burning gasoline blend components. Companies in the alkylate market are taking advantage of this opportunity to adopt reactors that are replacing hydrofluoric acid (HF) alkylation and resulting in commercially proven processes with high return in investment.

High Throughput Experimentation Using PAT Tools Help Optimize Alkylation Reactions

In-situ technologies used in conjunction with automated reactors help the chemist with a thorough understanding of how reaction conditions and variables relate to the overall reaction performance. Chemical manufacturers in the alkylate market are taking efforts to understand kinetics, thermodynamics, and effect of reaction variables on alkylation necessary for reaction development, scale-up, and safety to achieve desired final product specifications.

Manufacturers in the alkylate market are investing in robust chemical reactors and reaction calorimeters to ensure that reaction energetics are well understood. They are conducting high throughput experimentation using data-intensive PAT (Process Analytical Technology) tools to characterize and optimize alkylation reactions for improved performance. Manufacturers are establishing stable revenue streams by using alkylation to produce fuels from petroleum.

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Analysts’ Viewpoint

Researchers in Denmark have proposed a study of patients who experience severe COVID-19 symptoms due to the exposure of perfluorinated alkylate substances (PFAS) chemicals. On the other hand, alkylating chemotherapies are found to be effective in cancer treatment. However, both sulfuric and hydrofluoric acid are potentially dangerous and can lead to corrosion-induced accidents and expensive processes in complex reactors. Thus, companies should increase focus on the new solid acid catalyst technology, which is emerging as an alternative to HF alkylation and replacing bottlenecks associated with liquid acid alkylation reactors. Innovations in the reactor technology are helping to realize significant process benefits and achieve optimal alkylate product quality.

Alkylate Market: Overview

  • Alkylate is one of the conversion processes used in petroleum refineries to convert isobutane and low-molecular-weight alkenes into alkylate, which is a high octane gasoline component        
  • Manufacturers of alkylates have increased production capabilities due to the rise in modern farming techniques. This has boosted the demand for alkylate in the agriculture sector, as alkylates are extensively employed in the formulation of various agrichemicals including fertilizers, insecticides, herbicides, and pesticides. Several manufacturers of agrochemicals have invested significantly in expansion of their production facilities in the past few years. This is expected to propel the global alkylate market during the forecast period.
  • According to Transparency Market Research’s latest research report on the global alkylate market for the actual year 2020, and the forecast period 2021 to 2031, rise in usage of alkylate in applications such as functional fluids and additives is a key factor that is anticipated to boost the global alkylate market during the forecast period
  • In terms of revenue, the global alkylate market is estimated to reach US$ 99.4 Bn by 2031, expanding at a CAGR of ~2% during the forecast period

Rise in Demand for Alkylate as Additive in Fuel: Key Driver of Alkylate Market

  • Alkylate is being used increasingly in the automotive industry, especially in developed and developing economies such as the U.S. and the U.K., and India and Japan, respectively. Growth of the industry can be ascribed to rise in number of hybrid vehicles and increase in government initiatives in growing markets such as India to encourage foreign investment in the local automotive industry.
  • The global automotive industry, comprising passenger cars, buses, trucks, and heavy-duty vehicles is projected to expand at a CAGR of 3.8% over the next few years. Automotive production has increased by 15% since 2015. Led by rise in disposable income of consumers, the passenger cars segment is anticipated to boost the global automotive industry. However, increase in environmental concerns and pollution is estimated to hamper the industry during the forecast period.
  • Alkylate is significantly used to add high octane hydrocarbons to major fuels (including gasoline). Gasoline (petrol) is used as fuel for internal-combustion engines. Increase in demand for highly efficient gasoline in the automotive sector around the globe is projected to boost the demand for alkylate. This, in turn, is likely to drive the global alkylate market during the forecast period.

Increase in Usage of Alkylate in Agrochemical Formulation to Boost Alkylate Market

  • Agrochemicals are chemical substances that are used in agricultural farmlands to restore the deficiency of nutrients in fields or crops. They also enhance the growth of crops by eliminating harmful insects. Agrochemicals improve the quantity and quality of farm products. They are utilized in all kinds of agricultural fields such as horticulture, dairy farming, livestock, grain farming, shifting cultivation, and commercial plantations.
  • Increase in incidences of crop infestation has prompted modern farming methods to rely on agrochemicals. Expansion of the agrochemical industry is fueling the demand for alkylate, as alkylate is used for sulfonation of agrochemicals such as fertilizers, fungicides, pesticides, herbicides, and insecticides.
  • Rise in demand for crop protection chemicals, such as fertilizers, fungicides, pesticides, herbicides, and insecticides is expected to be a prominent driver of the agrochemicals industry. This, in turn, is estimated to augment the global alkylate market during the forecast period.

High Demand for Alkylate from Aviation Industry

  • In terms of end use, the aviation segment held major share of the alkylate market in 2020. Alkylate is widely used in the aviation industry due to its properties such as gasoline blending, high octane, and low vapor pressure. The aviation segment is expected to expand at a CAGR of 2.1% during the forecast period.
  • Other highly lucrative segments of the alkylate market include automobile and agriculture

Alkylate Market: Competition Landscape

  • Detailed profiles of providers of alkylate have been included in the report to evaluate their financials, key product offerings, recent developments, and strategies
  • Key players operating in the global alkylate market are
    • Reliance
    • Marathon Petroleum
    • Exxonmobil
    • LUKOIL
    • Valero
    • Shell
    • Chevron Corporation
    • Honeywell
    • Janex SA.
    • NesteSoltex Inc
    • Hengyi

Alkylate Market: Major Developments

  • Key providers such as Exxonmobil, Valero, and Shell are focusing on expansion of their facilities, owing to the rise in demand for alkylate in various applications and end-use industries. Major developments in the alkylate market across the globe are highlighted below:
    • In May 2019, Exxonmobil announced plans to invest US$ 2 Bn in the expansion of its manufacturing facility in Baytown, Texas, the U.S. The expansion would help create 2,000 new jobs and increase the company’s production capacity.
    • In December 2020, Valero announced it had successfully commissioned a new alkylation unit at New Orleans, Louisiana, the U.S.
    • In January 2019, Royal Dutch Shell Plc (Shell) announced it had started the production of the fourth alpha olefins (AO) unit at its chemical manufacturing site in Geismar, Louisiana, the U.S. The 425,000-ton-per-year capacity expansion brings total AO production at Geismar to more than 1.3 million tons per annum. The Geismar plant produces alpha olefins, alcohols, ethoxylates, ethylene oxide, and ethylene glycols.
  • In the global alkylate market report, we have discussed individual strategies, followed by company profiles of providers of alkylate. The ‘Competition Landscape’ section has been included in the report to provide readers with a dashboard view and company market share analysis of key players operating in the global alkylate market.

Alkylate Market – Scope of the Report

The latest study collated and published by Transparency Market Research (TMR) analyzes the historical and present-day scenario of the global alkylate market in order to accurately gauge its future growth. The study presents detailed information about the important growth factors, restraints, and trends that are creating a landscape for the growth of the global alkylate market so as to identify growth opportunities for market stakeholders. The report also provides insightful information about how the global alkylate market would expand during the forecast period of 2021 to 2031.

The report offers intricate dynamics about different aspects of the global alkylate market, which aids companies operating in the market in making strategic development decisions. TMR’s study also elaborates on significant changes that are highly anticipated to configure growth of the global alkylate market during the forecast period. It also includes a key indicator assessment that highlights growth prospects of the global alkylate market and estimates statistics related to growth of the market in terms of volume (kilo tons) and value (US$ Bn).

This study covers a detailed segmentation of the global alkylate market, along with key information and a competition outlook. The report mentions company profiles of players that are currently dominating the global alkylate market, wherein various development, expansion, and winning strategies practiced and implemented by leading players have been presented in detail.

Key Questions Answered in TMR’s Report on Alkylate Market

The report provides detailed information about the global alkylate market on the basis of comprehensive research on various factors that are playing a key role in accelerating the growth potential of the global market. Information mentioned in the report answers path-breaking questions for companies that are currently operating in the market and are looking for innovative methods to create a unique benchmark in the global alkylate market, so as to help them design successful strategies and make target-driven decisions.

  • Which end use segment of the global alkylate market would emerge as major revenue generator during the forecast period?
  • How are key market players successfully earning revenue out of advantages of alkylate?
  • What would be the Y-o-Y growth trend of the global alkylate market between 2021 and 2031?
  • What are the winning imperatives of leading players operating in the global alkylate market?
  • Which application segment is expected to create lucrative opportunities for the global alkylate market during the forecast period?
  • Which are the leading companies operating in the global alkylate market?

Research Methodology – Alkylate Market

The research methodology adopted by analysts for compiling the global alkylate market report is based on detailed primary as well as secondary research. With the help of in-depth insights of the market-affiliated information that is obtained and legitimated by market-admissible sources, analysts have offered riveting observations and authentic forecasts for the global alkylate market.

During the primary research phase, analysts interviewed market stakeholders, investors, brand managers, vice presidents, and sales and marketing managers. Based on data obtained through interviews of genuine sources, analysts have emphasized the changing scenario of the global alkylate market.

For secondary research, analysts scrutinized numerous annual report publications, white papers, market association publications, and company websites to obtain the necessary understanding of the global alkylate market.

Alkylate Market – Segmentation

TMR’s research study assesses the global alkylate market in terms of production process, end use, application, and region. This report presents extensive market dynamics and trends associated with different segments of the market and how they are influencing growth prospects of the global alkylate market.

Production Process
  • Sulfuric Acid Alkylation
  • Hydrofluoric Acid Alkylation
  • Others
End Use
  • Aviation
  • Automotive
  • Agriculture
  • Others (including Electronics)
Application
  • Solvents
  • Surfactants & Synthetic Sulfonates
  • Specialty Lubricants
  • Functional Fluids
  • Additives
  • Others (including Esters)
Region
  • North America
  • Latin America
  • Europe
  • Asia Pacific
  • Middle East & Africa

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Alkylate Market

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