Ethylene Vinyl Acetate (EVA) Market - Growth, Trends, COVID-19 Impact, and Forecasts (2021 - 2026)
The global ethylene vinyl acetate (EVA) market is expected to reach USD 1,713.88 million by 2026, registering a CAGR of 4.89% during the forecast period (2021-2026). In terms of volume, the market is is expected to reach 809.09 kilotons by 2026, registering a CAGR of 4.26% during the forecast period. The growing demand from the packaging industry and rising usage in the solar industry are likely to drive the demand for the studied market.
On the flipside, the detrimental impact of the COVID-19 outbreak and the increasing threat of substitutes are expected to hinder the growth of the market.
Rising demand from agricultural applications is likely to create opportunities for the market in the coming years.
Asia-Pacific region is expected to dominate the market and is also likely to witness the highest CAGR during the forecast period.
Solar Cell Encapsulation Segment to Drive the Market Growth
Ethylene-vinyl acetate (EVA) layer is a thermoplastic containing cross-linkable ethylene vinyl acetate, which is used to encapsulate the photovoltaic cells. The cells are laminated between films of EVA in a vacuum, under compression, and up to 150°C. The encapsulant's primary purpose is to bond or laminate the multiple layers of the module together. A typical EVA co-polymer formulation for PV modules is 28-33% by weight vinyl acetate, compounded with additives such as curing agents, ultraviolet (UV) absorbers, photo antioxidants, and thermo antioxidants.
The thermal aging of an ethylene-vinyl acetate (EVA) polymer is used as an adhesive and encapsulant in a photovoltaic module. The EVA is used to bond silicon solar cells to the front glass and backing sheet and to protect the photovoltaic materials from the environment and mechanical damage. Nearly 80% of photovoltaic (PV) modules are encapsulated by EVA materials. EVA has lots of advantages, such as low processing temperature, excellent melt fluidity, and adhesive property, high adhesion strength, and high transparency, with glass-like transmission properties in the range of 400 nm to 1100 nm. In addition, the price is low, which makes it very suitable as a solar cell encapsulation material.
In addition to this, EVA has high electrical resistivity, a relatively low water absorption ratio, all of which points to it being a good choice for a PV module encapsulant. However, there are also few shortcomings with EVA. Its damp-heat aging resistance and ultraviolet aging resistance are not satisfactory. It also easily degrades and becomes yellow, thus, reducing the energy conversion efficiency of the solar cell.
China to Dominate the Asia-Pacific Market
In the Asia-Pacific region, China is the largest economy in terms of GDP. The country witnessed about 6.1% growth in its GDP during 2019, even after the trade disturbances caused due to its trade war with the United States. Although China was the first country affected by COVID-19 and its related lockdown, it was the first country to come out of the lockdown. However, the country has been witnessing recurring cases of COVID-19, leading to brief lockdowns occasionally. The manufacturing sector in the country has taken a major hit in Q1 2020, subsequently leading to a 6.8% drop in GDP, the lowest ever witnessed in years. However, the country has been focusing on several measures, such as tax breaks and other incentives to enhance economic recovery. Overall, in 2020, China's GDP has recorded a growth rate of 1.9%, indicating signs of a V-shaped recovery.
China has the second-largest packaging industry in the world. The country is expected to witness a consistent growth during the forecast period, owing to the rise of customized packaging in the food segment, like microwave food, snack foods, and frozen foods, along with increasing exports. Ethylene vinyl acetate copolymers (EVA) are commonly used in packaging applications replacing Polyvinyl chloride as the most used resin. EVA copolymers require no curing or Plasticizer and have no odor. The use of EVA in the packaging sector is increasing at a tremendous rate, owing to their advantages over the conventional packaging plastics used. Furthermore, China is a hub for various manufacturing activities and hence is involved in export of various goods in bulk either small or huge to various international destinations. This scenario is, in turn, boosting the demand for EVA in packaging applications the country.
China feeds 22% of the world's population on 7% of the world's land. The revenue of the Food and Beverage (F&B) industry in 2019 amounted to USD 22.3 billion. This makes China's F&B market the biggest revenue generator in the world. Besides, with world's largest population in the country which is further continuously increasing, the food & beverage industry has been offering opportunities for investment. Furthermore, the energy sector, especially the solar power sector, is a key driver for the demand in the EVA market. China has more solar capacity than any other country in the world, and it is home to one of the biggest solar farms in the world (in TenggerDesert). The nation is expected to remain the largest investor in renewable energy during the foreseeable future. China is also looking to dramatically increase the proportion of solar energy in its power mix, which is expected to create a huge demand for the market studied in the country during the forecast period.
Moreover, large sporting events hosted by China, people's increasing pursuit for healthier lifestyle, and the country's active involvement in international trade within the World Trade Organization (WTO) framework, etc., are some of the major growth drivers for the sporting goods market in the country. All the aforementioned factors are expected to increase the demand for the market studied market over the forecast period after recovery of COVID-19 outbreak. However, currently, the conditions are better, which has concreted the probability of market recovery over the forecast period.
The global ethylene vinyl acetate market is fragmented in nature, with only top players together accounting for approximately 30% of the total market. The key players in the market studied include Exxon Mobil Corporation, Hanwha Group, Dow, Celanese Corporation, and Sipchem, among others. The major players are also focusing on R&D activities, developing innovative techniques for the development of the product, engaging in mergers and acquisitions in order to increase their market share, and optimizing the supply chain to increase its efficacy and specialization in the market.