April 16, 2021

Global Carbon Dioxide Market Snapshot

Around 40 billion tons carbon emissions are released into the atmosphere every year and 2020 witnessed a reduction of 7-8 percent because of COVID-19 pandemic.  However, if the 1.5-degree Celsius pathway were to be achieved, the carbon emissions reduction trajectory should follow that experienced in 2020 which implies seismic changes in global economy would be required from carbon neutral perspective.

Global CO₂ demand declined by close to three percent, arriving at 229 million tons in 2020. The reduction in use is mainly a result of reduced activities in EOR as mobility is restricted throughout the pandemic.  In contrast, demand in urea, food and beverages increased in 2020. CO₂ market has a modest volume impact on reducing emissions, especially as some consumption releases CO2 back into the atmosphere such as urea and food and beverage. However, development in utilizing CO2 cannot be underestimated, particularly in chemical synthesis.  Much progress has already been made in recent years in R&D for processes that could produce intermediates and polymers from CO2, instead of hydrocarbons, particularly in the production of methanol, and carbonates including polyols, polycarbonates, and concrete manufacture. 

Current demand for CO₂ has yet to saturate the supply of gas from the lower cost, higher purity sources including natural reservoirs,  natural gas processing, ethanol through aerobic fermentation, biogas via anaerobic fermentation and chemical processes including ammonia and ethylene oxide, however policy initiatives have largely focused on development of processes for absorption and removal of CO₂ from sources of low and medium concentrations.  The economic case for saturation of these sources and a movement into higher cost sources depends on the market pull from value-added uses including chemical synthesis, and/or sufficiently high carbon pricing through Emissions Trading Scheme (ETS), or carbon tax.

Competitiveness of CO2 based chemical synthesis is evaluated alongside conventional hydrocarbon-based process that is practised at commercial scale, including methanol and polycarbonate which represent the typical pathways from CO2.  The United States, Western Europe, and China are selected as the regions for the comparison.

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Market Insights: Carbon Dioxide - 2021 provides analysis and forecasts to 2035 of the global carbon dioxide market.  Market Insights: Carbon Dioxide - 2021 includes discussion regarding key trends, as well as demand outlook  for nine regions: North America, South America, Western Europe, Central Europe, Eastern Europe, Middle East, Africa, Asia Pacific, and China with forecasts to 2035.  Demand is segmented by urea, enhanced oil recovery, food and beverages, and 'others.  Cost competitiveness of two CO2 derived chemicals is also included.