Introduction

Isobutanol, also known as isobutyl alcohol, is a colorless, chemical compound with various industrial applications, including as a solvent, fuel additive, and feedstock for the production of chemicals. It is produced by the carbonylation of propylene.

Global Isobutanol demand analysis

The global isobutanol demand was considerably lower than 2-EH and n-butanol to be more than 680 kilotons in 2023. The market saw a growth of 2.7%

Asia Pacific is the largest region accounting for more than 60% of the global Isobutanol demand. The demand will be driven by plasticizer production in China and as a fuel additive in North America.

The demand for Isobutanol in Western Europe was estimated to be around 45 kilotons in 2022. The main application for isobutanol is in solvents. Major producers of isobutyl acetate in Western Europe include BASF, INEOS, and OXEA. Demand in Western Europe is expected to grow around 1.5% as the market is relatively mature.

Isobutanol Capacity Analysis

The global Isobutanol capacity was estimated to be more than 950 kilotons in 2022. Most of the isobutanol is produced with n-butanol therefore, both the plants are integrated. Most of the capacities for Isobutanol are concentrated in the Asia Pacific, North America, and Western Europe markets. Major Isobutanol manufacturers are PetroChina, BASF, Gevo, Sibur, OXEA, and Luxi Chemicals.

In the Western Europe region, there are three Isobutanol manufacturers with BASF operating a 45 kilotons plant in Ludwigshafen, Germany, while OXEA operates a 15 kilotons plant in Oberhausen.

Russia is the major producer of Isobutanol in the Central & Eastern Europe. The country uses a different technology to produce Isobutanol, independently of n-butanol. Russian producers such as Gazprom Neftekhim Salavat and ANKhK are the sole producers in the country, producing Isobutanol for the Asia Pacific region.

Rising demand for Isobutanol as Solvents

Isobutanol is widely used in the coating industry as it prevents eroding of certain coatings when they are dried under humid conditions. It is commonly used as a diluent in cellulose nitrate lacquers which helps in improving the flow, gloss and resistance to blushing. Isobutanol has relatively low volatility, which means it evaporates slowly compared to other solvents which makes it useful in applications where a slower evaporation rate is desirable, such as in the formulation of coatings and adhesives. Isobutanol is considered a more environmentally friendly solvent option compared to some other volatile organic compounds (VOCs) and has a lower potential for contributing to air pollution and smog formation.

Use of Bio-Isobutanol as a Biofuel

Isobutanol can be blended with gasoline as an oxygenate, improving octane ratings and reducing emissions. The push for cleaner-burning fuels has driven the demand for isobutanol in this application.

When used as a fuel additive or blended with gasoline, isobutanol has the potential to reduce greenhouse gas emissions and air pollutants compared to traditional gasoline. It can contribute to cleaner-burning fuels, which aligns with environmental regulations and sustainability goals.

Fluctuations in Crude Oil Prices

Isobutanol is manufactured via the carbonylation of propene. The raw materials used for manufacturing Isobutanol are derived from crude oil. The price fluctuation of crude oil hinders the price of Isobutanol raw materials which will also impact the Isobutanol market. In recent years, there has been an increase in the price volatility of crude oil and because of this uncertainty in the crude oil process, the prices of Isobutanol also increase. This, the volatility in the crude oil prices is expected to be a significant challenge in the Isobutanol market during the forecast period.