Global Bio-based 1,4-Butanediol Market Worth USD 200.97 Billion With a CAGR of 25.69%

Introduction

Bio-based 1,4-butanediol is a chemical intermediate derived from renewable sources such as sugar, and cellulosic feedstock. Bio-based 1,4-butanediol is gaining popularity due to its many benefits, including biodegradability, high durability, stability, high moisture resistance, and excellent insulating characteristics. The need for bio-based 1,4-butanediol is driven by these properties in several end-user industries, including automotive, textile, electronics, and more.

Market Dynamics

Stringent Government Regulations Drive the Global Market

Numerous manufacturing and end-user companies prefer bio-based 1,4-butanediol because they are under increasing pressure from various government regulations to demonstrate their environmental action improvements by lowering their carbon footprint and improving the sustainability of their operations. According to Novamont, bio-based BDO offers a life-cycle greenhouse gas emission decrease of 60% compared to fossil-based BDO. In addition, simulations by Qore show that QIRA, the next-generation BDO manufactured from plant-based sugars, will reduce greenhouse gas (GHG) emission levels by 93% compared to current manufacturing processes (the Cargill and HELM JV).

Different countries have passed and proclaimed various policies to lower GHG emissions. These regulations promote using 1,4-butanediol made from biomaterials, fostering business growth. One of the legislative recommendations made by the European Commission is for the European Union to achieve climate neutrality by 2050, with a minimum 55% net decrease in greenhouse gas emissions by 2030 from the level in 2019. The target has increased by at least 40% from the initial target. The new proposal supports the promise made in the European Green Deal to propose a comprehensive plan to sustainably increase the European Union's goal for 2030 to 55%. Furthermore, the proposal aligns with the Paris Agreement's objectives to prevent global warming to 1.5°C and pursue actions to keep it below 2°C.

Increasing Demand for Polybutylene Terephthalate (PBT) Creates Tremendous Opportunities

Bio-based 1,4-butanediol, produced mainly by the fermentation of carbohydrates, is polymerized with terephthalic acid to make polybutylene terephthalate (PBT). PBT is a thermoplastic polyester that is white or off-white, semi-crystalline and has increased electrical resistance, excellent chemical resistance, and high impact strength. PBT is highly suited for usage in the electrical and electronics, telecommunications & IT, and automotive industries because of its distinctive properties. To synthesize PBT, DSM first looked into and contrasted 1,4-butanediol (BDO) made from biomaterials created utilizing Genomatica's process technology to 1,4-butanediol (BDO) derived from petrochemicals. The company evaluated polymerization based on several factors, including net polycondensation (PC) and polycondensation (PC) time. No significant differences were found between the bio-based BDO and the conventional BDO in any of the polymerization parameters. PBT made with bio-based BDO, developed using Genomatica technology, was ideal within the constraints outlined by the company. The variations in BDO derived from petrochemicals and biobased sources are also within the range of typical measurement fluctuation. The experiment also revealed a startling similarity between PBT obtained from petrochemical and bio-sources in terms of melting enthalpy and heat of fusion.

Regional Analysis

Europe is the most significant revenue contributor and is expected to grow at a CAGR of 10.43% during the forecast period. The global health crisis and its restrictions caused an 8.5% drop in industrial output compared to the prior year. In response to the epidemic, the German government took several containment measures, including shutting down non-essential businesses to stop the virus's spread across the country. Germany is home to the most significant electronics and automotive sectors in Europe. Electric industrial production accounts for 10% of all industrial output and 3% of the nation's GDP (GDP). The textile and garment business is the second-largest consumer products industry in Germany. The United Kingdom is the largest European market for high-end consumer electronics items, home to roughly 18,000 electronics businesses. The demand for high-tech electronic devices has significantly increased in the nation's consumer electronics sector. The nation's electronics industry is expected to grow due to this increase in demand, as will the market for bio-based 1,4-butanediol utilized in electronic applications.

Asia-Pacific is expected to grow at a CAGR of 15.95% during the forecast period. The first 10-year action plan for China's manufacturing-based strategy, "Made in China 2025," has been made available to the public. The manufacturing industry is the foundation of the economy, the skeleton of the country, the secret to prosperity, and the heart of a vital state. Shandong LanDian Biological Technology is one of the biggest businesses in the country, producing bio-based 1-4 BDO. This Chinese start-up produces succinic acid through microbial fermentation, which is then purified, esterified, hydrogenated, and transformed into BDO. China, which already dominates the BDO market and accounts for about half of worldwide consumption, will continue to do so. The demand for derivatives like THF (tetrahydrofuran), PTMEG (poly-tetramethyl-ether-glycol), and GBL (gamma-butyrolactone) from the chemical industry is anticipated to drive the market for BDO as a whole, even though the butanediol industry in India is still in its infancy. New bio-based BDO and derivatives capacity in Asia-Pacific may stimulate the industry under investigation and drive new derivatives investment.

Key Highlights

• The global bio-based 1,4-butanediol market size was valued at USD 25.67 billion in 2022. It is projected to reach USD 200.97 billion by 2031, growing at a CAGR of 25.69% during the forecast period (2023-2031).

• Based on application, the global bio-based 1,4-butanediol market is bifurcated into tetrahydrofuran (THF), polybutylene terephthalate (PBT), gamma-butyrolactone (GBL), polyurethane (PU), other applications. The tetrahydrofuran (THF) segment is the highest contributor to the market and is estimated to grow at a CAGR of 30.39% during the forecast period.
• Based on the end-user industry, the global bio-based 1,4-butanediol market is bifurcated into automotive, electrical and electronics, textile, and other end-user industries. The textile segment is the highest contributor to the market and is estimated to grow at a CAGR of 33.78% during the forecast period.
• Europe is the most significant revenue contributor and is expected to grow at a CAGR of 10.43% during the forecast period.

Competitive Players

1. BASF SE
2. DSM
3. DuPont Tate and Lyle Bio Products
4. Genomatica Inc.
5. LCY Group
6. Novamont SpA
7. Qira
8. Shandong LanDian Biological Technology Co. Ltd
9. Toray Industries Inc.

Recent Developments

• May 2024 - A letter of intent was signed by The LYCRA Company, a leader in the world of creating creative, sustainable solutions for the personal care and apparel industries, and Dairen Chemical Corporation (DCC) to convert QIRA®, the next generation of 1,4-butanediol (BDO), into low-impact PTMEG, which is the primary component of the patented bio-derived LYCRA® fiber. The first company in the world to commercialize this low-impact bio-PTMEG in large quantities is Dairen.
• May 2024 - Primient Covation LLC, which operates its PDO business under the name CovationBio PDO (formerly DuPont Tate & Lyle Bio Products LLC), announced that 2024 will mark the twentieth anniversary of the first investment made to commercialize Zemea® and Susterra® propanediol. These high-performing, sustainably sourced biomaterials are assisting in reducing the world's reliance on petroleum-based materials in a range of consumer and industrial applications.

Segmentation

1. By Applications
   1. Tetrahydrofuran (THF)
   2. Polybutylene Terephthalate (PBT)
   3. Gamma-Butyrolactone (GBL)
   4. Polyurethane (PU)
   5. Other Applications
2. By End-User Industry
   1. Automotive
   2. Electrical and Electronics
   3. Textile
   4. Other End-user Industries