Report Industry Investment Rating - Not provided in the content Core Viewpoints of the Report - Ethylene is the most important basic organic raw material in the chemical industry, known as the "mother of the petrochemical industry." Its production capacity, process routes, and downstream structure reflect a country's petrochemical development level [4]. - Ethylene production is mainly through steam cracking, with different raw materials leading to different process routes. Downstream applications are extensive, mainly in polyethylene, ethylene glycol, styrene, and PVC, and the demand is closely related to the macro - economy and industry cycles [4][5]. Summary According to Relevant Catalogs I. Ethylene Basics - **Definition**: Ethylene is the simplest olefin with the formula C₂H₄ and structure CH₂ = CH₂. It is an important chemical raw material and a natural plant - ripening hormone [8]. - **Physical and Chemical Properties** - **Physical Properties**: Colorless, slightly sweet - smelling gas at normal temperature and pressure; has a low melting point of - 169.2°C and a boiling point of - 103.7°C; less dense than air; difficult to dissolve in water but easy in organic solvents; highly volatile and flammable, with an explosion limit of 2.7% - 36.0% [10][11][15][16]. - **Chemical Properties**: Chemically active due to the C = C double - bond, mainly showing addition, oxidation, and polymerization reactions [17]. - **Storage and Transportation** - **Storage**: Commonly stored in low - temperature liquid form using double - layer or full - containment cryogenic storage tanks at about - 104°C; can also be stored in pressurized gaseous form in steel pressure vessels or spherical tanks [25][26]. - **Transportation**: Mainly transported by pipeline in large - scale plants and chemical parks; for long - distance or international transport, it is usually in low - temperature liquid form; high - pressure gaseous transport is used for short - distance and small - batch transport [27][29][30]. II. Ethylene Industry Chain - **Production Process** - **Mainstream Process: Hydrocarbon Steam Cracking**: Accounts for over 90% of global ethylene production. Raw materials include light (ethane, propane, butane), medium (naphtha), and heavy (AGO, VGO) types. The process involves raw material pre - treatment, cracking reaction, quenching and heat recovery, compression and purification, and low - temperature distillation separation [35][36][38]. - **Auxiliary Processes**: Catalytic cracking has a lower reaction temperature and is suitable for high - propylene demand scenarios; methanol - to - olefins (MTO) does not depend on petroleum resources and is suitable for areas rich in coal and natural gas [46][47]. - **Global Ethylene Production Process Pattern and Characteristics** - **Global Pattern**: In 2025, ethane cracking accounted for 39.27% and naphtha cracking 36.86%, together over 75%. Other processes play a supplementary role [51]. - **Trends**: The global ethylene process shows a trend of increasing light - hydrocarbon use, decreasing heavy - raw material use, and coexistence of multiple routes. There are significant regional differences based on resource endowments [57]. - **Downstream Demand** - **Polyethylene**: Consumes over 50% of ethylene, including LDPE, HDPE, and LLDPE, with different production processes and applications [68]. - **Styrene**: Produced mainly by ethylbenzene dehydrogenation. It is mainly used in synthetic polymers and rubbers, and its demand is sensitive to the manufacturing industry cycle [71]. - **Ethylene Glycol**: Produced by ethylene oxidation - hydration globally, and coal - based process is developed in China. Over 80% is used in the polyester industry [74]. - **Ethylene Oxide**: Produced by direct ethylene oxidation. It is mainly used to produce ethylene glycol and is also used in other fields [77]. - **PVC**: Produced by ethylene and calcium carbide methods, with products used in hard and soft goods [78]. - **EVA**: Produced by copolymerizing ethylene and vinyl acetate. Low - VA EVA is used in foaming materials, and high - VA EVA is used in photovoltaic encapsulation films, etc. [82].

Group 1 - Ethylene is a cornerstone of the petrochemical industry, with a wide range of derivatives used in packaging, agriculture, construction, textiles, electronics, and automotive sectors [2] - The upstream raw materials for the ethylene industry chain include naphtha, ethane, and coal, while polyethylene accounts for the largest share of downstream derivatives [2][3] - In 2022, China surpassed the United States to become the world's largest producer and consumer of ethylene [2] Group 2 - The global ethylene market size is projected to reach $146.22 billion in 2024, with a CAGR of approximately 5.68% from 2025 to 2034 [2] - The average operating rate for global ethylene production has been around 80% over the past two years, with negative average investment returns and international ethylene prices at relatively low levels [2] - Europe and South Korea are experiencing a wave of facility exits, with Europe expected to permanently lose 4.6 million tons of ethylene capacity by the end of 2027 [2] Group 3 - The trend in global ethylene raw materials is shifting towards light and diversified sources, with ethane and other light hydrocarbons increasing in proportion [3] - Middle Eastern and North American regions have a competitive edge in ethylene cash production costs due to raw material advantages, while Europe and China rely more on naphtha, resulting in higher production costs [3] - Northeast Asia remains dependent on imports for ethylene and its derivatives, with North America and the Middle East leading in net export volumes [3] Group 4 - From 2022 to 2030, Asia is expected to contribute over 60% of the global new ethylene capacity, with China and India being the main drivers of capacity expansion [4] - China's ethylene production primarily relies on naphtha, with coal/methanol-to-olefins and light hydrocarbon cracking processes complementing each other, creating a unique competitive advantage [4]