Trends in the renewable chemicals production market

Dublin, May 28, 2024 (GLOBE NEWSWIRE) — The “Renewable Chemicals Manufacturing Market – Global and Regional Analysis: Application, Product and Region Focus – Analysis and Forecast 2023-2033” report has been added to ResearchAndMarkets.com offering.

It is estimated that by 2033, the global market for chemical production from renewable sources will reach USD 254.15 billion. The study highlights that this market will record a CAGR of 10.49% during the forecast period 2023-2033.

Market driver: Growing awareness about sustainable products to reduce pollution

This increased awareness significantly influences purchasing decisions, driving industries to use renewable chemicals in response to market demands. Companies are paying more attention to sustainability to strengthen their brand image and meet changing consumer expectations.
Moreover, stringent environmental regulations further encourage the use of renewable chemicals. As awareness increases, the market continues to evolve, supporting innovation and investment in sustainable practices to meet the demand for eco-friendly products.

Market challenge: high costs of producing chemicals from renewable sources

The renewable chemicals production market faces enormous challenges hindering its growth path. Energy intensity and raw material expenditure contribute significantly to this, as renewable processes require more energy and complex methods compared to conventional counterparts.
Renewable chemicals involve higher production costs due to complex production processes, expensive raw material sourcing, and ongoing technology development. For example, extracting fermentable sugars from plant material for biochemicals involves processing costs. To alleviate these challenges, manufacturers can focus on improving process efficiency, optimizing resource use and incorporating renewable energy sources into production, ultimately working towards more sustainable and cost-effective solutions.

Market opportunity: development of the electric vehicle (EV) industry.

The rapid development of the electric vehicle (EV) industry is acting as a significant catalyst for the growth of the renewable chemicals production market. One of the key factors influencing this relationship is the growing demand for lithium-ion batteries, mainly used in electric vehicles.
The remarkable growth of automotive lithium-ion (Li-ion) batteries is particularly driven by the expansion of electric vehicles around the world, the International Energy Agency (IEA) reported in 2023. This explosive growth, exemplified by a 65% increase in battery demand in 2022 alone, represents a growing market for energy storage solutions, which in turn drives demand for chemicals needed to produce batteries.
The dominance of traditional vehicles (82% market share according to the 2023 IEA report) creates a significant opportunity for producers of EV battery chemicals due to the enormous growth potential as electric vehicles become more popular. With changing market dynamics favoring electric vehicles and continuous technological advancements, the demand for electric vehicle battery chemicals continues. Manufacturers can take advantage of this by expanding production capacity, investing in research and development to obtain superior battery materials, and diversifying their product offerings. With this opportunity, they can become key players in shaping the future of transport.

Market segmentation

Segmentation 1: by application

Transport
Agrochemical
Food and beverages
Personal hygiene
Pharmaceuticals
Paints and coatings
Detergents and cleaning products
Industrial
Others

Transportation to dominate global renewable chemicals market (by application)

In 2022, the biochemicals market was mainly driven by the transportation sector, driven by rising demand for biofuels. As the world’s third-largest oil producer and largest oil exporter, Russia’s conflict with Ukraine has sent oil prices soaring, driving up fuel and gas prices around the world. As a result, nations are increasingly looking for alternatives to fossil fuels to accelerate the ecological transition and reduce dependency. Bioethanol has shown promise due to its renewable nature and ability to increase fuel efficiency while reducing emissions when blended with gasoline and gasoline. In response, various countries are considering increasing the obligation to blend bioethanol to reduce fuel prices and promote sustainable development. For example, to reduce skyrocketing U.S. fuel prices caused by Russia’s war in Ukraine, Joe Biden unveiled a new plan in April 2022 to increase the availability of gasoline blended with corn-based ethanol.

Segmentation 2: by product type

Alcohols
Organic acids
Polymers
Others

Alcohol Will Dominate Global Renewable Chemicals Market (By Product Type)

In 2022, the alcohol segment has emerged as a dominant force in the renewable chemicals production market, driven by rising demand for alcohols such as ethanol and methanol across sectors. It is worth noting that in the transport and mobility segment there has been a noticeable shift towards the adoption of green methanol, driven by the urgent need to decarbonize the maritime industry. Major players such as AP Moller – Maersk and Stena have made significant investments to use green methanol as the primary fuel for marine vessels. For example, AP Moller – Maersk’s significant March 2022 agreement with Orsted, providing 300,000 tonnes of e-methanol per year for a fleet of 12 methanol vehicles, highlights the industry’s commitment to sustainability. This strategic move not only recognizes the need to reduce greenhouse gas emissions, but also reflects a broader push towards greener solutions in the transport sector.

Segmentation 3: by raw materials

Vegetable oil
Ligno
Sugar
Starch
Biomass
Others

The vegetable oil segment will dominate the global market for the production of chemicals from renewable sources (by raw material)

In 2022, vegetable oils have emerged as a dominant force in the biochemicals market, driven by several key factors. Vegetable oils from renewable sources such as soybean, palm, rapeseed and sunflower are a promising solution due to their renewable nature and lower environmental impact. Moreover, advances in biotechnology and chemical engineering have increased the efficiency and profitability of converting vegetable oils into biochemicals.

Innovative processes such as enzymatic hydrolysis and fermentation have enabled the production of a wide range of bio-based products, including bioplastics, biofuels and biochemicals, from vegetable oil feedstocks. These factors have collectively propelled vegetable oils to the forefront of the biochemicals market in 2022, contributing to their widespread adoption and market dominance.

Segmentation 4: by region

North America: USA, Canada and Mexico
Europe: France, Germany, Italy, Spain, Great Britain and the rest of Europe
Asia-Pacific: China, Japan, India, Australia and New Zealand, Indonesia and the rest of Asia-Pacific
Rest of the world: South America, Middle East and Africa

North America has emerged as a leader in renewable chemicals production due to a convergence of influential factors. The region’s robust research and development infrastructure, particularly in biotechnology and chemical engineering, enables the region to drive innovation and pioneer new products and processes. Moreover, the region benefits from supportive regulatory policies that encourage sustainable development and reduce dependence on fossil fuels, supporting investment and market development.

For example, according to the Foundation for Constitutional Rights, San Francisco has implemented a policy banning the use of standard plastic bags commonly used in supermarkets and major retailers for packaging and other purposes. The policy clearly requires stores that wish to continue using the bags to ensure they are only made from recyclable paper or biodegradable plastics. Therefore, this regulation is expected to have a significant impact on the uptake and expansion of renewable chemicals throughout the United States

Key market players and competition summary

The companies covered by the profiling were selected based on information collected from key experts and an analysis of the company’s reach, product portfolio and market penetration.

Leading companies in the renewable chemicals production market

BASF SE
CropEnergy AG
DSM
amiris
Braskem
Ewonik
Novozymes A/S
Cargill Company, Limited
Natureworks Limited
ADM
ARD
OCI
Mitsubishi Chemical Group Corporation
International Coal Recycling
Corbion

Companies not included in the above pool are well represented in various sections of the report (where appropriate)

Industrial impact

Key players in the renewable chemicals production market are investing heavily in research and development to expand their product offerings, driving further growth of the sector. These market participants engage in various strategic initiatives such as introducing new products, entering into contractual agreements, pursuing mergers and acquisitions, increasing investments and supporting collaborations with other organizations. To thrive in an increasingly competitive market environment, the renewable chemicals industry must deliver cost-effective solutions to expand its reach and sustain growth.

One of the key business strategies used by manufacturers in the renewable chemicals sector is local production to reduce operating costs, which ultimately benefits customers and increases market presence. Renewable chemicals have recently demonstrated significant medical benefits, further driving demand in the market. Major players such as BioAmber (Canada), Corbion (Netherlands), Myriant Corporation (USA), Braskem (Brazil), Metabolix Inc. (USA), Mitsubishi Chemical Group Corporation (Japan) and BASF SE (Germany) are actively investing in research and development to stimulate market demand.

Founded in 1983 and headquartered in Pune, Maharashtra, India, Praj Industries Limited is an Indian multinational company specializing in process and design engineering. With offices in South Africa, North America, Thailand and other countries, Praj Industries offers a wide range of products including ethanol production plants, water and wastewater solutions, bio-based products and research services. In July 2020, Praj Industries introduced its Bio-Prism offering, which focuses on the production of renewable chemicals and bio-based materials (RCM). This portfolio includes various bio-industrial products, with the main focus being bioplastics, as well as cellulose and lignin refining products and specialty products. The launch of the Bio-Prism portfolio expands Praj Industries’ product offering and is expected to contribute to revenue growth.

Key features

Report attribute	Details
number of pages	166
Forecast period	2023-2033
Estimated market value (USD) in 2023	$95.87 billion
Projected market value (USD) until 2033	$254.15 billion
Compound annual growth rate	10.4%
Regions covered	Global

More information about this report can be found at https://www.researchandmarkets.com/r/1rnntf

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Global market for the production of renewable chemicals