Renewable Chemicals Market Size, Share, Opportunities, COVID-19 Impact, And Trends By Product Type (Bio-based Chemicals (Alcohols (C1 And C2, C3 And C4, Others), Organic Acids, Ketones, Others), Platform Chemicals, Bio Polymers (Polylactic Acid (PLA), Starch Blends, Polyvinyl Acetate, Polyglycolic Acid, Others)), By Application (Transportation, Food And Beverage Packaging, Agriculture, Biomedical, Textiles, Housing, Others), And By Geography - Forecasts From 2022 To 2027

The Renewable Chemicals Market is expected to grow at a CAGR of 14.54% over the forecast period to reach a total market size of US$173.144 billion by 2027, increasing from US$66.926 billion in 2020. Renewable chemicals are chemicals that are produced from renewable feedstocks such as biomass, agricultural raw materials, and microorganisms. Bio-based chemicals are now becoming cost-competitive and provide opportunities for the replacement of petrochemicals with renewable resources. Increasing demand and support for eco-friendly products are expected to drive the market for renewable chemicals during the forecast period. However, the presence of substitutes and high prices are anticipated to restrain the growth of the market in the coming years.

Growing demand for environment-friendly products is driving the market for renewable chemicals over the forecast period

Countries today are targeting replacing fossil resources with renewable biological resources to produce food, chemicals, energy, and materials. The increasing concerns over climate change are considered one of the prime drivers for the growth of the market during the forecast period.  There is also a growing need for secure, sustainable food production and clean water, clothing, and resources for housing due to the ever-increasing human population. In addition, companies are beginning to cater to the demand for conscious customers by paying attention to their obvious impact on the environment. Also, eco-friendly products not only produce fewer emissions and reduce their carbon footprint but also lower shipping costs and create a positive brand image, which further propels the market growth opportunities for renewable chemicals over the forecast period.  The emission of greenhouse gases has been increasing globally as the trend of industrialization continues. The percentage of countries committed to peaking their emissions is expected to increase from 36% in 2010 to 60% in 2030 (source: Emission Gap Report 2018, United Nations Environment Programme). Besides, the European Commission has set a target of achieving of 80% reduction in emissions by 2050. That could be achieved by 81Mt of carbon dioxide being eliminated, which will require 85% of the clinker production to be equipped with carbon capture and storage technology. Such collaborative efforts and initiatives will drive the market for renewable-based chemicals in the coming years.

An increasing initiative by both public and private players

Both the government and the private sector are increasingly supporting and taking initiatives for the use of renewable chemicals. For instance, recently, AkzoNobel Specialty Chemicals launched its third edition of Imagine Chemistry collaboration innovation challenge under which the company invites start-ups, and university spin-outs among other potential partners to rescue the chemicals-related challenges and unboxed the new way that creates value for customers. In addition, major market players are investing heavily, which is anticipated to boost the market for renewable chemicals over the forecast period. For instance, in 2019, Biorefinery Nordfuel invested nearly €150 million and is scheduled to open a facility in Northern Finland in 2021 which will produce bioethanol and biofuel from softwood residues. In addition, in January 2019, Aemetis upgraded its Kakinada plant to produce fifty million gallons of biodiesel and bio-oil per year. The expansion also includes the installation of a pre-treatment unit to convert low-cost and waste feedstock into oil. Furthermore, in March 2015, Mexican foreign and environmental ministers presented the national climate submission in Mexico City, unveiling a strategy to reduce greenhouse gas emissions by approximately 22% by 2060. As a result, in January 2018, Holcim Mexico, a part of LafargeHolcim Group, gained an Environment Protection Declaration (EPD) for a type of highly-specialized premixed concrete that is eco-friendly.

North America is estimated to hold a significant share of the market.

By geography, the global renewable chemicals market has been segmented into the following: North America, South America, Europe, the Middle East, and Africa, and Asia Pacific(APAC) regions. North America is expected to account for a significant share of the global renewable chemicals market in 2019 and is projected to grow at a healthy CAGR throughout the forecast period. This growth is attributed to the presence of big market players coupled with the growing government initiative. As a result of rising awareness regarding greenhouse gas emissions regarding other forms of chemicals, it is compelling manufacturers and researchers to produce chemicals that not only reduce the emission of greenhouse gases such as carbon dioxide at a considerable level but also are cost-effective. The renewable chemicals market in the Asia Pacific region is anticipated to witness exponential growth owing to abundant feedstocks and technological innovation in countries like China and India. Also, growing carbon footprints due to rapid industrialization in developing countries like India and China boost the demand for renewable chemicals. In addition, Europe's renewable chemicals market will witness considerable growth during the forecast period on account of rising demand for environmentally-friendly products coupled with favourable government policies in the region. Furthermore, expanding the construction and agriculture industries is

Recent development and expansion

• In July 2022, NTPC RE Ltd (NREL) and Gujarat Alkalies and Chemicals Ltd (GACL) signed an agreement to collaborate on renewable energy and green chemical synthesis. This collaboration aims to achieve green hydrogen initiatives, including the development of the country's first pilot projects for green methanol synthesis, green hydrogen filling stations, green hydrogen blending into PNG, and green energy storage.
• OMV receives ISCC PLUS certification for the production of renewable chemicals at the Burghausen Refinery in May 2022. OMV Strategy aims to increase the production of sustainable fuels, chemicals, and materials by 2030.
• Praj Industries entered the global renewable chemicals and materials (RCM) market with its newly launched Bio-Prism portfolio in July 2020. This will boost the economy while also being environmentally friendly.

Covid 19 impact on Renewable Chemicals Market

The outbreak of COVID-19 resulted in a drop in oil prices due to decreased global demand for oil. A plentiful supply of crude oil on the market helps synthetic chemical manufacturers secure raw materials at a lower cost, which had a negative impact on the production of renewable chemicals. Furthermore, with rising demand for agricultural products such as wheat, rice, potatoes, and edible oils, the use of agricultural raw materials for the production of renewable chemicals is decreased. Moreover, the pandemic has caused supply chain disruption as a result of factory and business closures, canceled air transport routes, and lockdowns. Major players in this market have begun producing PPE products such as masks, hand sanitizers, hospital gowns, and others in response to COVID-19. The focus of key players during this pandemic on the production of important and necessary items has also reduced the production of renewable chemicals.

Renewable Chemicals Market Scope:

Market Segmentation:

• By Product type
  • Bio-based chemicals
    • Alcohols
      • C1 and C2
      • C3 and C4
      • Others
    • Organic Acids
    • Ketones
    • Others
  • Platform Chemicals
  • Bio Polymers
    • Polylactic Acid (PLA)
    • Starch Blends
    • Polyvinyl Acetate
    • Polyglycolic Acid
    • Others
• By Application
  • Transportation
  • Food and Beverage Packaging
  • Agriculture
  • Biomedical
  • Textiles
  • Housing
  • Others
• By Geography
  • North America
    • USA
    • Canada
    • Mexico
  • South America
    • Brazil
    • Argentina
    • Others
  • Europe
    • UK
    • Germany
    • France
    • Others
  • Middle East and Africa
    • Saudi Arabia
    • UAE
    • Others
  • Asia Pacific
    • Japan
    • China
    • India
    • South Korea
    • Thailand
    • Indonesia
    • Taiwan
    • Others