Renewable Chemicals Market

Global Renewable Chemicals Market Outlook

The global sales of Renewable Chemicals in 2021 was held at US$ 86.7 Billion and is predicted to reach US$ 262.9 Billion by the end of 2032. With 10.6%, the projected market growth during 2022 - 2032 is expected to be significantly higher than the historical growth.

Ethanol is expected to be the highest revenue-generating segment, projected to grow at a CAGR of over 12.5% during 2022 – 2032.

Attributes	Details
Renewable Chemicals Market CAGR (2022-2032)	10.6%
Renewable Chemicals Market Size (2022)	US$ 95.8 Billion
Renewable Chemicals Market Size (2032)	US$ 262.9 Billion
Forecast Period	2022-2032
Historical Data Available for	2017-2021
Key Companies Profiled	Mitsubishi Chemical Corporation Genomatica Cobalt Technologies BASF SE Du Pont Tate and Lyle Bio Products Amyris, Incorporation Archer Daniels Midland Company Bio Amber Incorporation Braskem Cargill Incorporation Myriant Corporation Evonik Industries AG Praj Industries Ltd

Revenue of Renewable Chemicals Market from 2017 to 2021 Compared to Demand Outlook for 2022 to 2032

As per the Renewable Chemicals Market research by Fact.MR - a market research and competitive intelligence provider, historically, from 2017 to 2021, the market value of the Renewable Chemicals Market increased at around 10% CAGR. Growing environmental concerns and government backing for eco-friendly materials and products are all driving the renewable chemicals industry expansion.

According to the International Energy Agency, in its study Global Energy Review 2021, as demand for coal, oil, and gas rises, energy-related CO2 emissions are expected to expand by 4.8% in 2021.

The rise of about 1,500 Mt CO2 will be the highest single increase as compared to the carbon-intensive economic recovery from the global financial crisis, and it would leave world emissions reaching roughly 400 Mt CO2, or 1.2% lower in 2021 than they were in 2019. This is a serious cause of concern for both the government and the industrialists.

Renewable chemicals possess the properties like lesser waste, eliminating costly remediation, hazardous waste disposal, and end-of-pipe treatments. Because of the rise in greenhouse gas emissions, renewable chemicals are also needed to reduce carbon footprints. Furthermore, low-cost feedstocks like biomass, environment-friendly products, and ongoing technological advancements like using old bottles for the manufacture of polyurethane raw materials, may boost the industry forward in the near future.

• The renewable Chemicals Market was valued at US$ 86.7 Bn in 2021. According to Fact.MR, Renewable Chemicals Market revenue would increase 2.7X between 2022 and 2032, reaching roughly US$ 262.9 Bn in 2032.
• In terms of Product Type, Ethanol accounts for the highest projected CAGR of over 12.5%.
• In terms of Feedstocks of Renewable Chemicals, Biomass accounts for the highest CAGR of 11.3% during the historical period.
• The US is the dominant country in the Renewable Chemicals Market with an absolute dollar growth opportunity of over US$ 38.6 Bn.

What Factors are Propelling Renewable Chemicals Demand?

There are numerous factors propelling the demand for renewable chemicals. Depletion of fossil fuels and rise in greenhouse gas emissions will force the industries to use renewable chemicals like ketones, ethanol, biopolymers, etc. in manufacturing.

The restrictions that government imposes in the form of emission fees to discourage the use of fossil fuels are also a contributing factor to the increase in the demand for renewable chemicals. In 2020, the US government charged US$ 24-US$ 39/tCO2e (tonnes of carbon dioxide equivalent) from various companies. Besides, several manufacturers have also added bio-ethanol to their product portfolio to promote environment-friendliness.

Which Region is projected to Offer the Largest Opportunity for Renewable Chemical Market?

During the projection period, APAC is predicted to be the leading market for Renewable Chemicals. In 2021, the market size in the region was almost US$ 73 Bn. The key element accelerating the growth of the renewable chemical market in the Asia Pacific is the increased need for green chemicals to reduce carbon footprint.

Current studies have revealed that the significance of renewable chemicals in supporting the Asia Pacific economy is expected to boost the regional market’s growth.

What are the challenges associated with the manufacture of Renewable Chemicals?

The challenge that the market will face is the high production cost, which might encourage only a few participants to enter the market, thereby creating a monopoly. When compared to their synthetic equivalents, certain renewable alternatives to conventional petrochemicals have proved exceedingly expensive.

Lower purchasing power, as well as a lack of consumer understanding of these chemicals, particularly in the Asia Pacific and Africa's growing economies, may obstruct renewable chemical adoption in these countries in the coming years.

Country-wise Analysis

Which Country Lies at the CenterStage for Renewable Chemicals Market Revenue?

The United States is expected to account for the highest market share of US$ 63.1 Bn by the end of 2032. This is due to the rise in the concern for sustainability. Increase in the focus of government towards reduction in the greenhouse gases like carbon dioxide, methane, nitrous oxide, etc.

Furthermore, to increase the market share in the renewable chemical industry, companies like BASF SE, Genomatica, and Biosynthetic Technologies are pursuing various growth strategies such as mergers and acquisitions, strategic partnerships, cooperation, and manufacturing facility developments.

Category-wise Insights

Why Ethanol is Projected to Witness the Fastest Growth among Renewable Chemicals Product Type?

Ethanol is forecasted to grow at the highest CAGR of over 12.5% during 2022-2032. Ethanol also has the highest market share in the global context. Renewable ethanol is also eco-friendly in nature. As the supply of non-renewable chemicals is depleted to a very low level, the prices of crude oil increased as a result and the demand for bio-ethanol like bio-butanol or bio-methanol has increased.

It is further predicted that there will be a significant increase in the demand for vehicles as a result of a huge population increase, leading to higher demand for bio-ethanol.

Which Feedstocks of Renewable Chemicals are expected to Score Highest Growth in the Coming Years?

Biomass commanded the largest revenue as well as a CAGR of nearly 13.2%, during the forecast period.  More biomass fuels are being used in new projects, which is expected to boost worldwide biomass growth. In addition, increased demands are also a result of the initiative taken by industries from various sectors like textile, automotive, agriculture and petrochemicals.

Which End-Use segment is expected to perform well in the Renewable Chemical Markets?

The automobile industry is the most profitable end-user for renewable chemicals market since the industry increases demand for biodiesel, bioethanol and biopolymers.

Organisation Internationale des Constructeurs d'Automobiles (OICA), an international trade association, claimed that the automotive sector consumes renewable chemicals like biomass-based diesel fuels, such as biodiesel and renewable diesel, which are biofuels derived from biomass.

What is the impact of Covid-19 on Renewable Chemicals Market?

Covid-19 outbreak had resulted in a narrower demand for chemicals. The emergence of Covid-19 resulted in a decline in the oil prices due to a reduction in world oil consumption of roughly 29 Mn barrels per day. It led to a high supply of crude oil in the market making the prices of synthetic chemicals and materials cheaper. This reduction in the prices had a detrimental impact on renewable chemical production.

Due to lockdowns, the demand for basic commodities and canned goods had skyrocketed, leading to the hoarding of long-lasting items like rice and wheat. Covid-19 had hampered the supply chain, availability of raw materials, and logistics.

Moreover, as a result of covid-19, a significant number of participants in the industry have begun producing PPE or Personal Protective Equipment such as masks, kits, and sanitizers. The key market participants of the renewable chemical industry are extensively focusing on the production of essential and necessary goods, which in turn led to a reduction in renewable chemicals production. For instance, Cargill and BASF SE diverted their production to PPE kits and hand sanitizers.

Competitive Analysis

Players in the market are constantly developing improved analytical solutions as well as extending their product offerings. To help healthcare organizations implement data analysis solutions, combat the Covid-19 pandemic, and preserve competitive advantage in the market, the companies are focused on their alliances, technology collaborations, and product launch strategies.

Some of the recent developments of key Renewable Chemical providers are as follows:

• In July 2020, Praj Industries introduced a new Bio-Prism portfolio that produces renewable chemicals and materials. The portfolio of Praj Industry already includes Bio-Industrial products. This new addition to the existing portfolio will further help in optimizing its revenue.
• In April 2021, Du Pont announced that they will focus more on sustainability and try to reduce carbon footprint and improve operations, thereby generating lesser waste and higher energy efficiency.
• In October 2021, Mitsubishi Chemical Holdings, established in Japan, seeks to invest US$ 875 Mn by 2030. The funding will be mainly utilized to install solar energy and construct a plastic business that recycles used vegetable oils. By 2050, the corporation aspires to achieve a net-zero in greenhouse gas emissions.
• In September 2021, around 49.5% of the Vattenfall wind farm, Holland Kust Zuid was purchased by BASF SE. The wind farm has already started construction in July 2021 in the Dutch North Sea. This subsidy-free offshore wind farm is scheduled to begin its operation in 2023. This is BASF’s first huge investment in the field of renewable energy.
• In November 2021, Lummus Technology has signed an MoU with Braskem Netherlands B.V., which is a subsidiary of Braskem, the world's largest biopolymer manufacturer. The MOU is targeted to the license of Braskem's green ethylene technology for two of the ethanol to ethylene conversion projects in development in Asia and North America, indicating that the technology has a worldwide audience.

Similarly, recent developments related to companies’ Renewable Chemicals services have been tracked by the team at Fact.MR, which are available in the full report.

Market Segments Covered in Renewable Chemicals Market Analysis

• By Product Type :

  • Ethanol
  • Ketones
  • Biopolymers
  • Platform Chemicals
  • Other Product Types

• By Feedstocks :

  • Biomass
  • Corn
  • Sugarcane
  • Algae
  • Other Feedstocks

• By End-Use :

  • Automotive
  • Medical
  • Food and Beverages
  • Petrochemicals
  • Textiles
  • Agriculture
  • Other End-Uses

• By Region :

  • North America
  • Latin America
  • Europe
  • APAC
  • MEA