Global Silicones

Global Silicones

Global demand for silicones is forecast to grow 3.2% yearly, reaching 3.0 million metric tons – valued at $29.9 billion – in 2028. Gains will be supported by accelerating construction and manufacturing activity, as well as an improvement in motor vehicle production. The continuing uptake of silicones in lower income countries will also support demand increases. In value terms, gains will be boosted by greater use of better-performing silicones in high-income countries.

Construction & Transportation Markets to Offer Best Opportunities
Although every silicone market is expected to see gains, the best opportunities will arise in the large construction and transportation markets:

• Following a period when a variety of pandemic-related issues – including supply chain backups, high building material costs, and rising interest rates – provided some measure of restraint on building construction, construction activity is expected to accelerate, causing silicone demand in this market to rise. Other trends, including the ongoing urbanization of many developing countries in the Asia/Pacific and Africa/Mideast regions, will also support gains.
• The transportation market is expected to account for a sizable portion of gains as the motor vehicle industry surpasses pre-pandemic levels of production, due in part to an increase in car ownership in many lower income countries.

China’s Demand Gains Driven by Construction & Solar Panels

China represents the largest global market for silicones, and it is forecast to account for half of absolute volume gains globally. Gains will be driven in part by a rebound in multifamily housing construction as the country seeks to accommodate its growing urban population, and rising nonresidential building construction as the country’s economy and manufacturing base continue to increase. The electrical product market will also see significant gains as China’s massive solar panel industry increases its output to meet both domestic and international demand for renewable energy.

Prices Will Normalize Following a Volatile 2018-2023 Period

Between 2018 and 2023, silicone pricing was volatile. Increasing raw material prices and capacity reductions drove prices up by over 10% in 2018. Manufacturers increased silicone capacity in 2019 and 2020 and, in combination with decreased demand during the first months of the COVID-19 pandemic, prices declined in that span. However, as manufacturing and construction activity rebounded in 2021, silicone demand surged enough to quickly outstrip capacity; prices shot up by over 18% in 2021, and an additional 13% in 2022. Price growth was also affected by supply chain issues that limited access to raw materials, causing prices for those materials to also rise quickly. Prices finally moderated in 2023, the result of capacity increases and greater raw material availability.

Prices are expected to rise through 2028, albeit at a much slower pace than was seen in 2021 and 2022, as higher-value silicones see increasing use, especially in high-income countries.

This Freedonia industry analyzes the $30 billion global market for silicones. It presents historical demand data (2013, 2018 and 2023) and forecasts (2028 and 2033). Annual historical data and forecasts are also provided for 2020-2027. Volume and value demand are given in both metric tons and dollar value, and discussions on pricing trends, global production, and international trade are also included. Both value and volume demand are broken down by region, country, product, market, and function. Products covered include: elastomers, silicone fluids, resins, and gels, foams, and pastes. Markets covered include: construction, electronic products, transportation, chemicals and plastics, electrical products, medical and healthcare, personal care, and other markets (industrial and consumer). This study also evaluates market share and competitive analysis on industry competitors, including China National Bluestar Group (Elkem), Dow Chemical, Dupont, Evonik Industries, Momentive Performance Materials, Shin-Etsu Chemical, and Wacker Chemie.