The global 1,4-butanediol market size was estimated at USD 4.72 billion in 2013. High growth in emerging economies coupled with rising product demand from various end-use industries is expected to drive the industry over the forecast period. 1,4-BDO is an organic compound and used as an industrial solvent & cleaner and glue removers. It is a key raw material for manufacturing spandex via producing polytetramethylene ether glycol.
Butanediol can be produced by various industrial processes including propylene oxide, allyl acetate, Davy process, Butadiene process, and bio-based process. At room temperature, BDO is a colorless, odorless, and viscous liquid. It is an intermediate chemical for tetrahydrofuran (THF), polytetramethylene ether glycol (PTMEG), gamma-butyrolactone (GBL), polybutylene terephthalate (PBT), and polyurethane (PU). These chemicals are widely used in engineering plastics, fibers, medicines, artificial leather, cosmetics, pesticides, hardener, plasticizers, solvent, and rust remover.
Rising THF and spandex demand for sports apparels is anticipated to fuel the industry over the forecast period. An increasing number of sporting events such as Olympics and FIFA World Cup is expected to have a positive effect on the market for the foreseeable future. BDO is less durable than its non-synthetic counterpart, natural latex.
BDO is used to manufacture polyurethanes, which has large downstream applications such as footwear, transportation, and building & construction. Rising footwear demand, mainly in Asia Pacific and Latin America, is expected to fuel industry growth over the next six years. However, growing environmental concerns regarding the adverse impact of the product may set back the demand. This has shifted consumer preference towards bio-based products.
Stringent government regulations regarding synthetic chemicals in the U.S. and Europe are anticipated to pose a challenge to the product industry. High manufacturing costs coupled with volatile raw material prices are projected to hinder butanediol market growth
North America butanediol market revenue by product, 2012 - 2020 (USD Million)
Tetrahydrofuran (THF) emerged as the leading application segment and accounted for over 29% of total volume in 2013. THF is primarily used for manufacturing spandex fibers. Rising spandex demand on account of growing sports industry is expected to drive this particular segment over the forecast period.
In 2013, polyurethane market accounted for over 25% of total volume. Polyurethane is projected to be the fastest growing application segment at an estimated CAGR of 5.1% from 2014 to 2020. Rising footwear and construction industry in emerging economies such as India and China may be attributed to the fastest growth in this particular segment.
PBT accounted for 22% of total volume in 2013. It is mainly used in household electrical engineering and the production of plug connectors in the automobile industry. GBL demand is anticipated to increase primarily due to its downstream applications as a pharmaceutical intermediate, in herbicides and foundry resins. It is also used as an extraction solvent via N-methyl-2-pyrrolidone.
Asia Pacific dominated the BDO industry and accounted for 50% of total volume share in 2013. It is expected to be the fastest growing market at an estimated CAGR of 5.1% from 2014 to 2020. Growing disposable income levels mainly in countries such as China and India have contributed to the growth of the regional market. High production capacities in Asia Pacific give flexibility to the manufacturers to scale up the production depending upon demand trends.
Product demand in North America was 308.4 kilo tons in 2013. North America and Europe are relatively mature markets for BDO and are expected to grow at a sluggish rate compared to other regions with high growth and are primarily driven by the growth of bio-based chemicals.
BASF and Dairen Chemicals dominate the global butanediol market share, accounting for over 38% in 2013, with BASF being the largest player at over 24%. The other main players in the market include Lyondell Chemicals, Shanxi Sanwei Group, International Specialty Products, Invista, and Mitsubishi Chemicals.
Key players in the global industry such as BASF, Purac, Myriant, Mitsubishi Chemicals, DSM, and Genomatica are focusing on developing bio-based products. Companies are investing heavily in developing bio-based routes to produce BDO. Raw materials for such courses include bio-based succinic acid and sugar that contain biomass and polyhydroxyalkanoate (PHA).
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