The global bio solvents market demand was 2,505.5 kilo tons in 2013 and it is projected to grow at a CAGR of 5.2% from 2014 to 2020. Fluctuating petrochemical prices coupled with growing health concerns due to VOC presence in conventional solvents are expected to remain key factors driving the global market. Stringent regulations by REACH, EPA and DEFRA regarding toxicity of conventional solvents have driven the shift in trend towards developing bio solvents. This trend is expected to have a positive impact on the global market growth.
Solvents are used in paints & coatings to dissolve different compounds, making it suitable for application. Solvent based paints dry faster than that of its alternatives, keeping higher production rate. Increasing health concerns along with stringent governmental regulations regarding VOC emission has increased use of bio-solvents in paints & coatings industry. Use of bio solvents is increasing on account of their eco-friendly and easy disposable nature.
Increasing bio solvents penetration in paints, coatings, printing inks, sealants and adhesives is expected to further drive the global market growth. Growth of construction and automotive industries in emerging markets of Asia Pacific and Latin America on account of urbanization and industrialization are expected to drive paints & coatings demand. Growing paints & coatings market is expected to further augment the market growth. Increasing awareness regarding harmful effects of conventional solvents in pharmaceutical and personal care products is expected to further drive bio solvents demand in the respective applications.
Widespread R&D to increase bio solvents application scope in pharmaceutical and cosmetics applications is expected to provide opportunities to market participants. High production costs associated with bio solvents has been acting as an entry barrier to market entrants. Advancements in production technologies and product innovation are expected to counter such challenges over the forecast period.
The report segments bio solvent products into lactate esters, soy methyl esters, alcohol and glycols among others such as d-limonene, diols and polyhydroxyalkanoates. Lactate ester was a major product segment and accounted for 30.04% of the total market volume in 2013. Growing lactate ester solvents demand in coatings, printing inks and industrial applications is expected to drive the market growth over the forecast period.
Glycol solvents are expected to register highest growth on account of its increasing penetration in automotive coatings, industrial coatings, paints and printing inks. Its slow evaporation rate and high blush resistance are driving its demand over other solvents in the above stated applications.
On the basis of application, bio solvent market is categorized as paints & coatings, adhesives & sealants and printing inks among other niche applications such as pharmaceuticals and cosmetics. Increasing construction spending in emerging markets such as Brazil, China, India and Mexico on account of rapid industrialization and urbanization is expected to drive paints & coatings demand. Shift in trends towards using eco-friendly paints coupled with growing construction industry is expected to drive bio solvents demand.
Paints & coatings emerged as the largest application segment with 1,106.5 kilo tons of demand in 2013. Increasing paints & coatings demand in construction and automotive industries has been a major factor driving bio solvents demand. Adhesives & sealants are expected to grow at an estimated CAGR of 5.3% from 2014 to 2020 to emerge as the fastest growing bio solvent application segment.
North America was a major bio solvents consumer and accounted for 34.97% of the total market volume in 2013. The market in the region is characterized by high level of awareness regarding health and environmental effects of conventional solvents coupled with stringent environmental regulations. Increasing construction spending by the U.S. government to improve public infrastructure in the region is expected to drive paints & coatings demand which in turn is expected to have a positive impact on North American bio solvents market over the forecast period.
Asia Pacific is touted to register significant growth rates on account of growing construction and automotive industries. Rapid industrialization in emerging markets of China and India are expected to drive adhesives and sealants demand. This trend coupled with growing concerns regarding degradability of conventional solvents is expected to further drive the Asia Pacific market growth.
The global market is concentrated with top four companies accounting for more than 60% of the market share in 2014. Major companies operating in the global market include The Dow Chemical Co., AkzoNobel N.V., E.I. du Pont de Nemours & Co., Cargill Inc., BASF SE., LyondellBasell, BioAmber, Huntsman Corp., Myriant Corp., Vertec Biosolvents and Florida Chemicals.
Major companies are involved in joint ventures and M&A in order to develop bio solvent products and maintain their market position. Increasing presence of small-scale producers in Europe and China is expected to further drive competitiveness in the market. Companies are actively investing in R&D to improve existing production technologies and increase application scope.
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