Published November 2016
Acetic anhydride is a colorless liquid with a pungent odor and strong lachrymatory properties. In the United States, the major portion of acetic anhydride consumption is captive by producers of cellulose acetates and related products. Much of the acetic anhydride is produced from recovered acetic acid from cellulose acetate operations.
Cellulose acetate flake drives demand for acetic anhydride globally, and demand for it is in turn driven by filter tow applications in cigarettes. Demand for cigarette filter tow has been declining in the last few years in developed countries like the United States, Western Europe, and Japan as a result of increased government bans and policies on smoking. Electronic cigarettes or e-cigarettes also play a pivotal role in causing the decline in consumption.
The following pie chart shows world consumption of acetic anhydride:
China's increasing self-sufficiency for acetic anhydride has affected global trade to China in the last few years. Nevertheless, the country will continue to import to satisfy its growing demand for the product. In 2016, Western Europe is the largest importer of acetic anhydride, consuming 75% of global imports.
In 2016, 61% of the acetic anhydride consumed globally was used in the production of cellulose acetate flake. Cellulose acetate flake is converted to cigarette filter tow, filament yarns, and plastics. With the exception of Asia outside Japan, the markets for cellulose acetate in most regions are mature and declines have occurred in recent years.
Cellulose acetate is used in various other end uses including textiles and clothing, because of its comfortable, breathable, and absorbent nature. Other applications include spectacle frames, tool handles, wound dressings, and personal hygiene products. Filter tow accounts for more than 80% of cellulose acetate consumption, thus driving overall demand.
Pharmaceuticals accounted for 10% of global acetic anhydride consumption in 2016. This end use is mature in the developed regions, but is still growing in Asia, particularly in China and India, where production in this industry has increased.
TAED amounted to about 5% of global acetic anhydride consumption in 2016.
Other uses for acetic anhydride, including polymers/resins, dyes, flavors and fragrances, and modified starches, account for the remaining 24% of consumption.
In the United States, growth in demand is expected to be flat in the next five years (2016–21), better than the slight decline observed in the last five years. Acetic anhydride used for cellulose flake production will decline because of the declining exports to China, as well as continued flat growth in the cigarette filter tow market. Additionally, only limited growth is expected for pharmaceuticals and miscellaneous applications. Acetylated wood is a new application that has emerged in the last five years. It is still in test marketing, and the growth prospect is uncertain at this time.
In Western Europe, consumption of acetic anhydride will grow at 1% on an average annual basis during 2016–21. The steep decline in domestic demand during 2011–16 (at an average annual rate of 4.3%) was coupled with capacity closures in the region. Both TAED and pharmaceutical applications are considered mature. The market for acetylated wood in Western Europe is in a more advanced stage than in the United States; however, it is still too small to impact the market in the near term.
In Japan, acetic anhydride consumption will also decline for the same reasons outlined in the previous paragraphs.
China is expected to continue to be one of the few bright spots for acetic anhydride during 2016–21, although in the last year there has been an apparent decrease in cigarette production and sales, affecting cellulose acetate consumption. This is attributable, however, to the stocking and destocking of inventory in China, rather than to an actual decline in cigarette consumption, and the market is expected to stabilize.
Acetic anhydride consumption in China will grow at 3.4% per year during the forecast period. Given the availability of acetic anhydride, the country is also expected to diversify into other anhydride markets, including flavors and fragrances, dyes, sweeteners, TAED, and PTMEG.
Other Asia (outside of Japan and China) will experience consumption growth rates ranging from 2% to 3% per year. The main driver will be the pharmaceutical industry as more producers start up in the region, such as in India. There will also be increased use in the dyes and pigments industries.
In the Middle East, where a new acetic anhydride plant came onstream in 2010, consumption has approximately doubled between 2011 and 2016, increasing at an average annual rate of 17%. Growth in demand will be much slower in the next five years.
Global demand for acetic acid is forecast to grow at an average annual rate of 3.6% during 2016–21. Acetic anhydride accounts for a 13–14% share of demand for acetic acid. Acetic acid demand for acetic anhydride will grow positively in the next five years, although somewhat slower than the rate observed in the last 10 years.
Overall global acetic anhydride consumption is expected to grow at an average rate of 1.4% annually during 2016–21.