1,4 Butanediol Market Size, Share & Trends Analysis Report By Derivative (Tetrahydrofuran (THF), Polybutylene Terephthalate (PBT), Gamma-Butyrolactone (GBL), Polyurethane (PU)), By End-User Industry (Automotive, Healthcare and Pharmaceutical, Textile, Electrical and Electronics), By Type (Synthetic, Bio-based), By Technology (Reppe Process, Davy Process, Butadiene Process, Propylene Oxide Process, Others) and By Region(North America, Europe, APAC, Middle East and Africa, LATAM) Forecasts, 2023-2031

Market Overview

The global 1,4 butanediol market size was valued at USD 2,319.04 million in 2022. It is expected to reach USD 3,193.75 million by 2031, growing at a CAGR of 3.62% during the forecast period (2023–2031).

The clear, viscous 1,4 butanediol (BDO) is one of the four stable isomers of butanediol. It produces additional organic chemicals such as polybutylene terephthalate (PBT), a plastic used in engineering, polyurethane (PU), and other derivatives. Tetrahydrofuran (THF) is used to produce spandex fibers and urethane elastomers. GBL is utilized in electronic components, pharmaceuticals, agrochemicals, and high-performance polymers. It is used as a solvent in organic synthesis and has applications in numerous end-use industries, such as automotive, pharmaceutical, electrical and electronic, synthetic leather, and agricultural chemicals. 1, 4 butanediol (BDO) is utilized in various applications, including chemical and adhesives manufacturing, fiber and particle composites, plastic processing, and pharmaceuticals, due to its hydrophobicity, chemical resistance, and exceptional durability.

Highlights

• The tetrahydrofuran (THF) segment is the highest contributor to the market by derivative.
• The textile segment is the highest contributor to the market by end-user.
• Asia-Pacific is the most significant revenue contributor by region.

Market Dynamics

Global 1,4 Butanediol Market Drivers

Rising Tetrahydrofuran (THF) Demand for Spandex Fibers

A typical organic compound called tetrahydrofuran (THF) is used to make polytetramethylene ether glycol (PTMEG), which is then used as a base chemical to make spandex and polyurethanes. The creation of PTMEG, which is primarily used in the production of spandex and other polyurethanes, consumes more than 65% of the tetrahydrofuran produced globally. Spandex is a synthetic fabric with a weight percentage of 85% polyurethane. Nearly half of all BDO applications worldwide are THF and THF-derivative-based. The spandex and elastane industry is the largest one in this area. Stretching spandex fibers between 500 and 700% of their original length without losing their shape is possible.

Furthermore, the trend toward comfortable clothing with good wearing comfort is one reason why spandex growth rates are significantly higher than growth rates for textiles. However, because of its superior qualities, spandex is frequently used to increase the comfort and elasticity of women's clothing, swimsuits, casual clothing, and sports fabrics. It has a high degree of uniformity, strength, and abrasion resistance. Tetrahydrofuran demand is anticipated to increase due to the growing demand for spandex in the textile industry, which will then fuel 1,4 Butanediol demand over the forecast period.

Global 1,4 Butanediol Market Restraints

Unfavorable Circumstances Resulting from the Covid-19 Outbreak

The major consumer electronics brands' international supply chains have also been impacted by COVID-19. China is the world's largest producer and consumer of consumer electronics products. It also serves many nations by exporting raw materials primarily used to make finished goods. Other consumer electronics manufacturers based in the US and Europe were compelled to temporarily halt the production of the finished goods when the country's industries were shut down. Due to the widening gap between supply and demand caused by this, the market was severely constrained. Along with the production of sportswear and leather, the electronics sector also experienced a decline but is now beginning to recover in the post-Covidien environment. So, a marginally positive effect on the market under investigation is anticipated.

Global 1,4 Butanediol Market Opportunities

Lowering Clothing's Carbon Footprint

The fashion and clothing industries have been working hard to reduce their carbon footprint by concentrating on their emissions. The fashion industry has been moving toward sustainable practices that help the environment and reduce carbon footprint. To assist brands in switching from fossil-based chemistries to bio-based intermediates and lowering their greenhouse gas emissions, the American company Cargill and the German company Helm have announced a joint venture called Qore. By the agreement, both businesses will contribute a total of USD 300 million toward constructing the first BDO facility of this kind in the country. DSM intends to reduce its carbon footprint and boost the renewable content of Arnitel TPC products to up to 73% by replacing conventional BDO with this bio-based BDO. In the wake of lowering the carbon footprint of clothing, the market's subsequent developments and the various innovative measures taken by businesses are anticipated to present an opportunity for market growth.

Regional Analysis

The global 1,4 butanediol market is segmented into North America, Europe, Asia-Pacific, South America, and the Middle East and Africa.

Asia-Pacific Dominates the Global Market

Asia-Pacific is the most significant revenue contributor and is expected to grow at a CAGR of 3.97% during the forecast period. Nearly half of the world's BDO consumption occurs in China, which may dominate the market throughout the forecast period. China's capacity to produce THF has more than doubled in the past seven years. In 2016, the nation started to export THF net. THF and PTMEG exports to China have significantly decreased due to the rapid rise in THF/PTMEG production in China, mainly from Taiwan and Japan. Taiwan's export markets have changed to include South Korea, Japan, and India. The recent capacity expansions were primarily concentrated in China as well. The domestic demand for BDO and its derivatives is anticipated to be supported by the rising motor vehicle production and the expanding pharmaceutical, electrical and electronics industries, encouraging the market's future growth.

North America is expected to grow at a CAGR of 2.28% during the forecast period. The largest and most potent economy on earth is that of the United States. Due to the increasing initiatives for next-generation 5G plans, which present opportunities through bulk manufacturing of electrical and electronic components, the United States is anticipated to deliver enormous gains for the global PBT industry. In terms of size, the US electronics market is the biggest in the world and serves as one of the markets under study's most promising potential regions. Due to the use of cutting-edge technology, an increase in the number of R&D facilities, and a rise in consumer demand, it is also anticipated that this market will continue to hold the top spot throughout the forecast period. Due to the accelerated pace of innovation, the development of technology, and R&D activities in the electronics industry, there is a sizable demand for newer and faster electronic products. The emphasis on creating high-end products has led to a significant increase in the number of manufacturing facilities and development hubs in the United States.

Germany is one of the primary consumers of products derived from 1-4 BDO because the nation has a solid manufacturing base. Germany's four most significant manufacturing subsectors are the machinery and equipment, automotive, computer, and electrical and electronic equipment industries. Due to the manufacturing sector's moderate growth, the market demand is anticipated to increase steadily. With manufacturing making up 80% of all industrial production in Germany, this industry is the most significant. The three largest manufacturing subsectors are automotive, electronics, and machinery and equipment. One of the top producers of paints and coatings in Europe is Germany. There are 300 paint and printing ink manufacturers and many small and medium-sized businesses. Also, Germany is one of the world's most extensive paints and coatings producers. Some of the top paint producers have operations in Germany, including BASF SE, Dow, Beckers Group, Brillux, Altana Chemie, Meffert, and Mankiewicz. As a result, the nation's market demand is anticipated to rise.

Brazil has the largest economy in South America and has the ninth-largest GDP of any country in the world. Brazil has the biggest market for electric vehicles in Latin America, expected to drive market demand despite the decline of the traditional automotive industry. Brazil's constitution and justice commission, CCJ, approved a bill in mid-January that forbids the sale of new gasoline and diesel vehicles in the nation beginning in January 2030. Therefore, only vehicles powered by electricity or bioenergy, such as ethanol, would be allowed. The bill also bans using gasoline or diesel-powered vehicles beginning in 2040. The market demand should increase as a result of this. BDO has a wide range of uses in the electronics industry.

Some of South America's most significant electronics manufacturing facilities are in Brazil. Numerous major electronics manufacturers, including Samsung, LG, Foxconn, Dell, Multilaser, Positivo, AOC, Lenovo, and the Leadership Group, have extensive manufacturing facilities in the nation. Consumers in the nation are more cautious when purchasing expensive goods, and this behavior is anticipated to last for the foreseeable future. Samsung and LG maintain their positions as the top electronics manufacturers, showing strong market potential despite the difficult circumstances.

Saudi Arabia's economy heavily depends on oil exports, and the country has tight government control over all vital economic activities. In 2018, the country's economy expanded by 2.4%. However, the deliberate oil production cuts beyond those required by the OPEC+ agreement and lower oil prices caused the growth to stagnate in 2019. Despite the robust performance of non-oil sectors in 2019, supported by private consumption and investments, the economy grew by a pitiful 0.3% overall. Compared to other major countries, Saudi Arabia's electronics production has been significantly reduced, and the market has been slowing recently. The demand for electronic products like smartphones, LED and LCD TVs, tablets, electrical machines, equipment, and washing machines is growing, which positively impacts the market.

As a result, despite the recent slowdown in Saudi Arabia's electronics market, the country still has a sizable market opportunity, given the country's growing population and demand for electronics. Despite the low local production of electronics, the nation imports them. During the forecast period, the country's expanding electronics industry will probably only have a negligible influence.

Segmental Analysis

The global 1,4 butanediol market is segmented by the derivative and end-user industries.

Based on the derivative, the global 1,4 butanediol market is bifurcated into tetrahydrofuran (THF), polybutylene terephthalate (PBT), gamma-butyrolactone (GBL), and polyurethane (PU).

The tetrahydrofuran (THF) segment is the highest contributor to the market and is expected to grow at a CAGR of 3.68% during the forecast period. Tetrahydrofuran has many applications, including as an organic compound solvent and a raw material for synthesizing polymers. The conversion of THF, which is used as a monomer to create polytetramethylene ether glycol, occurs with about 50% of the world's BDO. This polymer is a part of co-polyester ethers, spandex, and urethane elastomers. THF and water combine at low temperatures to form solid clathrate hydrate structures. Tetrahydrofuran has recently been used more frequently as a starting material and additive in the production of synthetic polymers. THF can dissolve slightly soluble inorganic compounds and evaporates quickly and is appropriate for printing inks.

Thermoplastic engineering polymer Polybutylene Terephthalate (PBT) is a crystalline, high molecular weight polymer with an excellent balance of physical and processing characteristics. Mold cycles are brief, and molding temperatures can be lower than for many engineering plastics because the material crystallizes quickly. When treated with flame retardants, PBT can be made noncombustible and is solvent resistant shrinks very little when formed, is mechanically robust, and is heat resistant up to 150 °C (or 200 °C with glass-fiber reinforcement). It is an insulator in the electrical and electronic industries, automotive parts, and biodegradable packaging made of polybutylene succinate (PBS). Electrical engineering uses polybutylene terephthalate for housings, as well as in the manufacture of plug connectors for automobiles and household items like showerheads and irons.

Based on the end-user, the global 1,4 butanediol market is bifurcated into automotive, healthcare and pharmaceutical, textile, and electrical and electronics.

The textile seg ment is the highest contributor to the market and is expected to grow at a CAGR of 3.41% during the forecast period. Motion capture suits, surgical hoses, and support hoses are some examples of compression apparel made from the material. For businesses in the hospitality and manufacturing industries, this fabric is also helpful. Most spandex fabrics are used in clothing that must be both comfortable and form-fitting, such as hosiery, swimwear, activewear, socks, surgical hose, undergarments, gloves, cycling shorts, wrestling suits, rowing suits, and specialized clothing like zentai suits, motion capture suits, denim, etc. In addition, it is utilized in body suits, soccer balls, volleyballs, and netballs, among other sports equipment. Spandex is also used for tablecloths because of its elastic nature, which makes the fabric strong enough to withstand wear from frequent use. The material is also used in household products like fitted sheets and micro-bead pillows.

PBT, which is then used to make automobiles, is produced in large quantities using 1, 4-butanediol. PBT is used in a variety of automotive applications, including seat belts, airbags, door, and seat assemblies, subsystems, bumpers, under-bonnet components, exterior trim, and many others, to absorb energy, reduce weight, absorb shock for bumpers, and limit the risk of explosion in fuel tanks. Additionally, 1,4-butanediol-based urethane elastomers have a variety of uses in the automotive industry. Most cars have polyurethane foams in the headrests, armrests, and seats, where their cushioning qualities help to lessen the stress and fatigue frequently connected with driving. 

Recent Developments

• November 2022- Ashland introduced sclareanceTM biofunctional, made from clary sage flowers that are bio-transformed using non-GMO biotechnology in the company's owned clary sage fields in the United States. It is the second biofunctional product with artificial intelligence (AI) created by Ashland for health and wellness in scalp care, and it aids in reducing dandruff appearance while restoring a healthy scalp.
• October 2022- BASF opened a surface treatment innovation and technology center in China for Chemetall.