Dimethyl Ether (DME) Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The Dimethyl Ether (DME) Market is segmented by Source (Natural Gas, Coal, and Bio-based Products), Application (Propellants, LPG Blending, Fuel, and Other Applications), and Geography (Asia-Pacific, North America, Europe, South America, and Middle-East and Africa).

Market Snapshot

Dimethyl Ether Market  Overview
Study Period: 2016 - 2026
Base Year: 2021
Fastest Growing Market: North America
Largest Market: Asia Pacific
CAGR: 9.1 %
Dimethyl Ether Market Major Players

Need a report that reflects how COVID-19 has impacted this market and its growth?

Market Overview

The dimethyl ether (DME) market is expected to reach 5,867.28 kiloton by 2026, registering a CAGR of 9.10% during the forecast period (2021-2026). The market was negatively impacted by COVID-19 in 2020. Dimethyl ether (DME) can be used for liquefied petroleum gas (LPG) blending, as a transportation and power generation fuel, and as a propellant in paint sprays and others. Considering the pandemic scenario, the demand for DME-based LPG fuel from the automotive segment has been decreased, as people were not traveling frequently.

  • Over the short term, the growing demand from the LPG blending application is expected to drive the market's growth.
  • Unfavorable conditions arising due to the impact of COVID-19 are expected to hinder the market's growth.
  • Growing research for the use of DME as an alternative fuel is likely to create opportunities for the market in the coming years.

Scope of the Report

Dimethyl ether (DME), also known as methoxymethane, is an organic compound with the formula CH3OCH3. The raw materials used in the production of DME are coal, oil, natural gas, bio-mass, catalysts, etc. There are two conventional production processes used for dimethyl ether synthesis, including indirect and direct synthesis methods. In the indirect method, methanol is first produced from the syngas, and in the second step, methanol is dehydrated using solid acid catalysts to produce DME. Furthermore, in the direct method, DME is directly produced from syngas using bifunctional catalysts, where both methanol production and dehydration reaction occurs in the same reactor. The dimethyl ether market is segmented by application, source, and geography. By application, the market is segmented into propellants, LPG blending, fuel, and other applications. By source, the market is segmented into natural gas, coal, and bio-based products. The report also covers the market size of and forecasts for the dimethyl ether market in 15 countries across major regions. For each segment, the market sizing and forecasts have been done on the basis of volume (kiloton).

Natural Gas
Bio-based Products
LPG Blending
Other Applications
South Korea
Rest of Asia-Pacific
North America
United States
United Kingdom
Rest of Europe
South America
Rest of South America
Middle-East and Africa
Saudi Arabia
South Africa
Rest of Middle-East and Africa

Report scope can be customized per your requirements. Click here.

Key Market Trends

LPG Blending Segment to Dominate the Market

Liquefied petroleum gas (LPG) is one of the major applications of dimethyl ether (DME), which can be blended with traditional LPG at a pre-specified ratio for many applications. DME is being blended with LPG as an alternative fuel additive for enhancing combustion and reducing hazardous emissions, along with reducing dependency on LPG. Currently, around 15-25% of DME is utilized in DME-LPG blends, with higher ratio blends being researched, as a better blend may require equipment changes for usage. Countries like China, India, and Indonesia, are aggressively pushing for the use of DME as an alternate fuel, as these countries are highly dependent on imports for meeting their local LPG demand.

China is the first country to start using DME-blended LPG on a commercial scale. The majority of China’s DME demand is from households (for LPG blended cooking gas supply). In China, 20% DME blended LPG products are used for this purpose. In October 2020, India's Minister of Science and Technology and Earth Sciences launched a special burner unit for DME-LPG blend as a domestic cooking fuel under its “Aditi UrjaSanch” scheme. The newly designed stoves are expected to operate on 30% DME blended LPG. The country is trying to significantly increase the consumption of DME to reduce the dependence on LPG. According to Union Budget 2021, the Indian government has announced to add another 10 million LPG beneficiaries during the year 2021-22 in the scheme Pradhan Mantri Ujjwala Yojana under which cost-free LPG cooking gas connections are provided to women belonging to below poverty line (BPL) families, thus led to an increase in the demand for LPG within the country, which, in turn, stimulates the demand for the studied market.

Indonesia is another Asian country that is aggressively pushing for DME blended LPG for its energy needs. From a price standpoint, DME is cheaper than LPG, which is also pushing its demand. Companies, such as Air Products and Chemicals and PT Bukit Asam, are moving forward with major projects in the country for the production of DME from coal for LPG blending applications.

DME blended LPG is also used in the transportation industry, where the adoption level is low. Therefore, the aforementioned factors are expected to impact the market in the coming years significantly.

Dimethyl Ether Market  Key Trends

United States to Drive the Market Growth

The United States is the world's largest and most powerful economy, and it had a per capita income of USD 59,610 in 2018. The economy grew at a 2.0% pace during the April-June 2019 period. Furthermore, in the third quarter of 2019, the economy grew by an annualized 1.9%. There were signs that the economy maintained a moderate pace of expansion as the year ended, supported by a strong labor market. The severe COVID-19 outbreak in the country led to a downfall of economic growth, owing to a fall in consumer spending and business shutdowns. The non-residential construction sector is estimated to grow by 7.2%, with public building construction and educational building construction estimated to grow by 3.9% by 2021. Healthcare construction is also expected to grow by around 3.4%, followed by industrial construction, at 0.6%.

There are more than 70,000 commercial construction businesses in the country. In the United States, the Trump administration decided to provide USD 200 billion in the next ten years (as of February 2018) to spur a projected USD 1.5 trillion in the state and local governments and private sector investment to rebuild its infrastructure. Furthermore, in the United States, 4,392 construction projects are scheduled to start in the next 12 months, and 3,094 are in the planning phase (as of October 2019). Growth is also being witnessed in the housing repair and refurbishment activities.

DME is used for LPG blending that is in Propane autogas in the vehicles. According to the Propane Education & Research Council, there are nearly 260,000 on-road LPG vehicles with certified fuel systems in the United States. Many are used in fleet applications, such as school buses, shuttles, and police vehicles. Propane autogas is the leading alternative fuel in the United States and the third most commonly used vehicle fuel, following gasoline and diesel. More than 90% of the United States propane autogas supply is produced domestically, with an additional 7% from Canada. Almost 75% of the propane used in the United States comes from natural gas refining, and the remaining comes from petroleum during the refining process. Light-duty fleet vehicles that run on propane autogas emit fewer greenhouse gases, smog-producing hydrocarbons, and particulate emissions than gasoline-fueled light-duty vehicles. Compared with gasoline, vehicles fueled by propane autogas produce 17-25% fewer greenhouse gases, 20% less nitrogen oxide, and up to 60% less carbon monoxide. Thus, the demand for DME is expected to increase during the forecast period in the country due to the factors mentioned above.

Dimethyl Ether Market Growth Rate

Competitive Landscape

The dimethyl ether market is partially consolidated in nature, with the top five players accounting for about 40-45% of the production capacity. Additionally, there are various Chinese players in the market with notable shares. Some of the key players in the market include KOREA GAS CORPORATION, Zagros Petrochemical Company, Jiutai Energy Group, Mitsubishi Corporation, and Nouryon.

Recent Developments

  • In January 2021, Mitsubishi Corporation has announced that Caribbean Gas Chemical Limited (CGCL), a joint venture between Mitsubishi group companies including Mitsubishi Gas Chemical Company (MGC), Mitsubishi Corporation (MC), and Mitsubishi Heavy Industries Engineering (MHIENG), and the National Gas Company of Trinidad, started commercial production of dimethyl ether (DME) from the 18th of December 2020 with an annual production capacity of 20 kilotons of DME.
  • In May 2020, Air Products Inc and Haldor Topsoe A/S announced the signing of an agreement for developing potential projects related to the large-scale ammonia, methanol, and/or DME plants. Under this agreement, Air Products Inc. will use the technology developed by Haldor Topsoe A/S to build methanol, DME, and ammonia production plants.

Table of Contents


    1. 1.1 Study Assumptions

    2. 1.2 Scope of the Study




    1. 4.1 Drivers

      1. 4.1.1 Growing Demand from LPG Blending Applications

    2. 4.2 Restraints

      1. 4.2.1 Impact of COVID-19

      2. 4.2.2 Other Restraints

    3. 4.3 Industry Value Chain Analysis

    4. 4.4 Porter's Five Forces Analysis

      1. 4.4.1 Bargaining Power of Suppliers

      2. 4.4.2 Bargaining Power of Consumers

      3. 4.4.3 Threat of New Entrants

      4. 4.4.4 Threat of Substitute Products and Services

      5. 4.4.5 Degree of Competition

    5. 4.5 Price Scenario


    1. 5.1 Source

      1. 5.1.1 Natural Gas

      2. 5.1.2 Coal

      3. 5.1.3 Bio-based Products

    2. 5.2 Application

      1. 5.2.1 Propellants

      2. 5.2.2 LPG Blending

      3. 5.2.3 Fuel

      4. 5.2.4 Other Applications

    3. 5.3 Geography

      1. 5.3.1 Asia-Pacific

        1. China

        2. India

        3. Japan

        4. South Korea

        5. Rest of Asia-Pacific

      2. 5.3.2 North America

        1. United States

        2. Canada

        3. Mexico

      3. 5.3.3 Europe

        1. Germany

        2. United Kingdom

        3. Italy

        4. France

        5. Rest of Europe

      4. 5.3.4 South America

        1. Brazil

        2. Argentina

        3. Rest of South America

      5. 5.3.5 Middle-East and Africa

        1. Saudi Arabia

        2. South Africa

        3. Rest of Middle-East and Africa


    1. 6.1 Mergers and Acquisitions, Joint Ventures, Collaborations, and Agreements

    2. 6.2 Market Ranking Analysis

    3. 6.3 Strategies Adopted by Leading Players

    4. 6.4 Company Profiles

      1. 6.4.1 Air Products Inc.

      2. 6.4.2 DME-AEROSOL

      3. 6.4.3 Grillo Werke AG

      4. 6.4.4 Jiutai Energy Group


      6. 6.4.6 Mitsubishi Corporation

      7. 6.4.7 Nouryon

      8. 6.4.8 Oberon Fuels

      9. 6.4.9 Royal Dutch Shell PLC

      10. 6.4.10 The Chemours Company

      11. 6.4.11 Zagros Petrochemical Company

    5. *List Not Exhaustive

    1. 7.1 Growing Research for Use of DME as an Alternative Fuel

    2. 7.2 Under Established Market Offers Huge Potential for DME Growth

You can also purchase parts of this report. Do you want to check out a section wise price list?

Frequently Asked Questions

The Dimethyl Ether Market market is studied from 2016 - 2026.

The Dimethyl Ether Market is growing at a CAGR of 9.1% over the next 5 years.

North America is growing at the highest CAGR over 2021- 2026.

Asia Pacific holds highest share in 2020.

KOREA GAS CORPORATION, Zagros Petrochemical Company, Jiutai Energy Group , Mitsubishi Corporation, Nouryon are the major companies operating in Dimethyl Ether Market.

80% of our clients seek made-to-order reports. How do you want us to tailor yours?

Please enter a valid email id!

Please enter a valid message!