Global Polyols Market Grows Steadily at a CAGR of 6.05%

Introduction

Polyols are organic compounds characterized by the presence of multiple hydroxyl (–OH) groups. They occur naturally in certain fruits and vegetables but are also synthetically produced for use across various sectors, including food, pharmaceuticals, and industry. In the food industry, polyols such as sorbitol and xylitol are used as low-calorie sugar alternatives. Industrially, polyether and polyester polyols play a crucial role in the manufacturing of polyurethane-based products like flexible and rigid foams, coatings, adhesives, and sealants. Due to their wide range of applications, polyols are vital components in both consumer and industrial products.

Market Dynamics

Growth in construction activities drives the global market

The rising global construction activity is playing a crucial role in boosting the demand for rigid polyols, which are vital components in the production of polyurethane foam used for thermal insulation and enhancing structural strength. With the surging emphasis on energy-efficient and sustainable building practices, the application of rigid polyols in insulation boards, roofing, and wall systems is witnessing substantial growth.

• A report by AECOM forecasts that the global construction market will reach USD 19.52 trillion by 2027, registering a CAGR of 6% between 2023 and 2027. This expansion is largely fueled by strong growth in residential, commercial, and infrastructure projects, especially across emerging markets. For example, India’s construction sector alone is projected to grow by 11.2% in 2024, hitting INR 25.31 trillion.

Such developments are anticipated to significantly drive the demand for rigid polyols, thereby accelerating the growth of the global market.

Emergence of bio-based polyols creates tremendous opportunities

The surging emphasis on sustainability and the drive to reduce reliance on fossil fuels are opening up substantial opportunities for bio-based polyols in the global market. Manufacturers are turning to renewable resources such as vegetable oils, sugars, and bio-waste to develop eco-friendly polyols. This transition not only contributes to global efforts to lower carbon emissions but also resonates with the soaring consumer demand for environmentally conscious products.

• For example, in September 2022, Covestro—a prominent materials producer—launched polyether polyols derived from bio-circular feedstocks to facilitate the production of more sustainable polyurethane foams. These polyols are manufactured using the mass balance method, which involves the use of renewable inputs from bio-waste and residual materials that are proportionally assigned to the final products through a certified calculation process.

Such developments represent a significant advancement in promoting sustainable practices within the polyols industry.

Regional Analysis

The Asia-Pacific region presents substantial growth opportunities for the polyols market, driven by rapid urbanization, industrial expansion, and increased consumer spending. Countries like China and India are witnessing a surge in construction activities, fueling the demand for rigid polyurethane foams used in insulation and structural components. For instance, China's Belt and Road Initiative is accelerating infrastructure projects and enhancing polyol consumption.

Additionally, the expanding automotive industry in Japan and South Korea, focusing on lightweight and energy-efficient materials, is boosting the adoption of flexible polyols. The region's booming furniture and bedding sectors, supported by rising middle-class income and lifestyle changes, further contribute to market growth. Moreover, increasing environmental awareness and governmental support for sustainable practices are fostering the production and adoption of bio-based polyols, particularly in countries like Australia and Singapore, where green building norms are gaining prominence.

Key Highlights

• The global polyols market size was valued at USD 14 billion in 2024 and is estimated to grow from USD 30.90 billion in 2025 to reach USD 49.44 billion by 2033, growing at a CAGR of 6.05% during the forecast period (2025–2033).
• By source, the global polyols market is segmented into polyether polyols and polyester polyols. The polyether polyols dominated the market.
• By application, the market is divided into rigid foam, flexible foam, coatings, adhesives & sealants, elastomers, and other applications. The flexible foam segment dominated the market
• By end-user industry, the market is segmented into construction, automotive, furniture & bedding, packaging, personal care & cosmetics, and other industries.
• Asia-Pacific is the highest shareholder in the global market.

Competitive Players

1. BASF SE
2. Covestro AG
3. Huntsman Corporation
4. Dow Inc.
5. Shell Plc
6. Stepan Company
7. Mitsui Chemicals Inc.
8. Lanxess AG
9. Repsol S.A.
10. Wanhua Chemical Group Co. Ltd.

Recent Developments

• In April 2025 – Anhui Putan New Materials Technology Co., Ltd has officially launched its innovative continuous production unit for carbon dioxide (CO₂)-based polycarbonate polyol at the Huainan Modern Coal Chemical Industry Park. This milestone represents a major advancement in the development and industrial use of carbon-negative new materials, strengthening China’s leadership in sustainable polyurethane manufacturing.

Segmentation

1. By Product Type
   1. Polyether Polyols
   2. Polyester Polyols
2. By Application
   1. Rigid Foam
   2. Flexible Foam
   3. Coatings
   4. Adhesives & Sealants
   5. Elastomers
   6. Other Applications
3. By End-Use Industry
   1. Construction
   2. Automotive
   3. Furniture & Bedding
   4. Packaging
   5. Personal Care & Cosmetics
   6. Other Industries
4. By Regions
   1. North America
   2. Europe
   3. Asia-Pacific
   4. Latin America
   5. The Middle East and Africa