Renewable chemical market will grow from an estimated US$57.5 bln in 2012 to US$83.4 bln by 2018, at a CAGR of 7.7% from 2013 to 2018, as per Markets and Markets. The renewable chemicals market includes all the chemicals obtained from renewable feedstock such as agricultural raw materials, agricultural waste products or biomass, microorganisms etc. The development of this market is driven by the fact that renewable chemicals decouple economic growth from finite, non-renewable resource consumption, and also help diversify the feedstock portfolio. The emergence of bio-feedstock and bio-based commodity polymers production, in tandem with increasing oil prices, rising consumer consciousness, and improving economics, has ushered in a new and exciting era of renewable chemical commercialization. However, factors such as economic viability, product quality/performance, and scale of operation will still play important role in determining the commercialization spectrum. The renewable chemicals industry will witness high growth of 7.7% annually in next five years from 2013 to 2018, mainly due to continuous rise in oil prices, requirement for environmentally friendly feedstock, and low production cost of bio-based chemicals. Among the major renewable chemicals, ethanol is the most commercialized segment. Though it has been established in U.S. and Brazil; it has ample scope of growth in the European as well as Asian developing countries like India and China. In the biopolymers segment; starch plastics holds maximum share i.e. around 48%, whereas PHA is expected to grow at highest CAGR of over 27.7% during next five years.
The market is driven by increasing demand from the food packaging industry, biodegradable and compostable plastics, and other consumer products. The renewable chemicals market is estimated to reach US$59 bln in 2014 from about US$45 bln in 2009. While alcohols currently form the largest segment of the renewable chemicals market, the polymers segment holds the maximum growth potential at an expected CAGR of 11% from 2009 to 2014. Platform chemicals are estimated to reach a market size of US$3.5 bln in 2014 from US$1.9 bln in 2009 at an optimistic CAGR of 12.6% from 2009 to 2014. Platform chemicals play an important role in the renewable chemicals market since their multiple functional groups can be converted to families of highly useful chemicals. Immense market opportunity lies for the renewable chemicals market in the Japan and the rapidly developing economies of India, China, and Russia, which largely consume chemicals from petrochemical feedstock. Governmental support and initiatives to encourage the use of renewable chemicals is expected to provide the necessary boost to the market in these economies. Strategic alliances and new technology developments are a few of the most popular strategies being deployed by the market players in this segment to gain competitive edge and also to build upon their market presence by knowledge and resource sharing. Europe forms the largest market for renewable chemicals with an estimated US$21 bln by 2014. Its 5.5% CAGR from 2009 to 2014 is driven by consumer demand for green products and governmental support for such chemicals. U.S. is the second largest segment, growing at with an estimated a CAGR of 5.1% to reach US$17.5 bln by 2014.
As per an earlier report by MarketsandMarkets, the global renewable chemicals industry is into higher growth trajectory since the last 5 years. This growth is largely fueled by the increased concerns over greenhouse gas emissions. Some of major drivers of the industry identified in this report are abundant and low cost feedstock, consumers’ acceptance for eco-friendly products, government support, and technological innovations. The major restraints identified in this report are cost and production issues along with the trade off with the vital resources. There are some opportunities which can change the dynamics of this industry which are improved yields, new generation feedstocks, and collaboration with the universities. The global renewable chemicals market is estimated to reach US$76.16 bln in 2015 from US$36.90 bln in 2009, at a CAGR of 12.67% from 2010 to 2015. The Asian market is driving sales and is expected to hold 36% of the global market share in 2015. The biopolymer market is expected to have a CAGR of 22.7% due to higher demand for eco-friendly products and sales of biopolymers are expected to boost its share from US$3.01 bln in 2009 to US$8.36 bln in 2015. Starch plastics remains the leader in the biopolymers segment with 38.36% market share while PHA is expected to have the highest CAGR of over 40%. In the bioethanol market, the U.S. is the leading consumer. In the bioethanol market in Asia, China is the leading market with a share of 70% while India is expected to be the fastest growing market with a CAGR of 18.6%. Among the European nations, France is the leading producer of bioethanol with a share of 35.5% in 2009 in European bioethanol market. It is followed by Germany and Spain. The fastest growth is expected in U.K. and Czech Republic. Europe is the leading consumer for biopolymers, followed by North America and Asia. Europe alone constitutes around 40% of the global consumption of biopolymers. In Asia, China is the biggest consumer of chemicals and provides great opportunity for renewable chemicals in future.