The global green solvents market is expected to witness healthy growth over the next seven years owing to the high demand for green solvents from the end-use industries. Solvents are basically additives that are mixed along with other materials for producing new material. Growing health and environmental concerns regarding conventional solvent usage are presumed to play a critical role in shaping the future of the global market. Constant volatility in crude oil prices has negatively affected the conventional solvents market and is thus anticipated to drive the bio-based solvents market.
Growing green solvents acceptance across multiple industries over the past few years is expected to further complement the global market development. Shifting consumer preferences in favor of bio-based solvents is a key driver for the overall market development. Concerns regarding high VOC content in the conventional solvents have resulted in such a shift in consumer preference. Industry participants have invested heavily in R&D initiatives to develop superior and cheaper green solvents.
Governments and agencies such as the Environmental Protection Agency (EPA) and ECHA have implemented several regulations favoring green solvents, thereby aiding the global green solvents market. Initiatives to protect the environment such as the Montreal Protocol are expected to further complement the market. Rebounding the global economy in recent years is presumed to assist green solvent end-use industries such as construction, coating, cleaning products, industrial applications, toiletries, and cosmetics. Such robust demand from the end-use industries is slated to further compliment the global market. Environmental and health concerns have encouraged rapid green solvent acceptance in industries such as construction, paints and coatings, thus favoring the global market development.
However, massive unconventional hydrocarbon production in North America has pushed oil and gas prices to extremely low levels. Such a downturn in oil and gas prices has resulted in higher conventional solvents production due to higher profit margins. Such a shifting trend towards conventional solvent production is touted to hamper global market growth. Green solvents have a slower reaction rate compared to conventional solvents, thus requiring more operational time. Such operational, as well as technological difficulties, are projected to hinder the market growth.
Gargantuan initial investments required for entering the green solvents market are anticipated to ward off new entrants. Higher cost owing to costly production techniques and R&D investments are projected to retard the global market to some extent. Emerging markets such as Asia Pacific and Central & South America promise ample opportunities for the industry participants owing to massive construction initiatives and growing consumer goods demand. R&D initiatives to develop superior products and reduce production costs offer abundant opportunities for both the existing as well as new industry entrants.
Asia Pacific has dominated the global green solvents market over the recent past ahead of North America. The European market has witnessed sluggish growth over the last few years owing to severe eurozone crisis. Emerging economies such as India, China, Malaysia, Indonesia, Russia, Thailand, and Brazil are estimated to witness brisk growth in the green solvents market. Such robust demand can be attributed to construction initiatives, rising disposable income leading to higher consumer goods consumption and government initiatives regarding health and the environment.
Industry participants are taking strong measures to improve their product portfolio and increase production capacity to get a foothold in the growing emerging markets. Conventional solvent manufacturers are shifting their focus towards green solvents and forging partnerships with companies having access to raw materials and R&D capability. Prominent green solvents industry participants include Genomatica Inc., Archer Daniels Midland Company, Vertec Biosolvents, Akzo Nobel NV, The DOW Chemical Company, BASF SE, Sucrogen Bioethanol Pty Ltd., Bioamber Inc., Shenzen Esun Industrial Company Ltd., Cargill Incorporated, Pinova Holdings Inc., Cremer Oleo Gmbh & Company KG, Myriant Corporation, CSM NV, Lyondell Basell Industries NV, E.I. Du Pont de Nemours & Co., Hunstman Corporation, Finasucre S.A., Gevo Inc., and Florida Chemical Company Inc.
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The COVID-19 pandemic and subsequent halt in manufacturing activities shall have an impact on the supply availability of a variety of renewable chemicals. Furthermore, current disruption in trade shall also gravely impact the availability of chemical stocks in import-dependent countries. The report will account for Covid19 as a key market contributor.