The North America polyols market size was estimated at USD 4.5 billion in 2018 and is expected to exhibit a CAGR of 5.6% over the forecast period. The industry is driven by increasing demand for flexible polyurethane foams, which are used in applications such as upholstery, mattresses, and seats.
Flexible polyurethane foam manufactured from polyols finds application in commercial and consumer products such as carpet cushioning, furniture, bedding, transportation, packaging, fibers, and textile. This is owing to its favorable physical properties such as durability, resilience, and energy absorption. The positive outlook of the construction sector, particularly owing to rising demand in emerging economies, is expected to boost the production of flexible foams, thereby augmenting the demand for polyols.
In the U.S., flexible foam emerged as the largest application with a volume share of 33.5% in 2018. It is widely utilized as a cushioning material for bedding and mattresses, furniture, and seating. High demand for innovative polyol-based (rigid and flexible) foams on account of their versatility, durability, low cost, and high functionality are expected to drive the market over the forecast period.
Developments in polymer extraction and processing technology are likely to increase the application scope of polyols and polyurethane in the automotive sector. Automakers prefer polyol-based polyurethane (PU) for B pillars as well as soundproofing. PU foam produced from soy-based derivatives is primarily used for soundproofing applications in vehicles. For vehicle interiors, PU is used in gear shifts and steering wheels. The need for lightweight polyurethane products is anticipated to provide substantial growth opportunities for the market over the coming years.
The rising demand for polyurethane in the building and construction sector has boosted demand for polyols. According to the U.S. Department of Energy, heating, and cooling amounts to over 56% of overall energy costs in an average American household. Rigid foam insulation helps in saving resources and reducing the cost by lowering the energy consumption of a household. It also provides a water-resistant barrier to ceilings, roofs, walls, panels, and floors. The superior insulation capability and efficiency of polyol-based PU foams are expected to positively affect the growth over the coming years.
The market highly prices sensitive owing to the volatility of raw material prices and the presence of various players striving to manufacture products suitable for multiple applications. High competition prevailing in this industry is pushing manufacturers to produce innovative products. Companies are investing heavily in research and development activities for developing new products and meeting standards and regulations implemented across regions.
Rigid foam is the major application segment and accounted for a volume share of 33.6% in 2018. The structural stability of polyol-based rigid foams is expected to boost their demand in transportation, packaging, industrial insulation, and appliances. Rigid foams made with aromatic polyester polyols also possess strong mechanical strength, sound insulation properties, and thermal resistance, which makes them highly suitable for extreme weather conditions and harsh environments.
Polyols are also used for formulating polyurethane adhesives and sealants, which are primarily used to improve the flexibility and binding of products. They are used to formulate hot melt, radiation cured, solvent-borne, waterborne, and solid reactive adhesives and sealants, which are used in footwear, construction, automotive interiors, windshield bonding, and textile lamination applications.
Polyether and polyester polyols are used for manufacturing elastomers. Elastomers are typically polymers with the elasticity of rubber and combined strength of plastics. They are utilized in major end-use industries such as mattress and furniture, automotive, textile, footwear, and packaging, owing to their excellent mechanical and chemical properties, high durability, and low cost.
Based on the product, the North America polyols market is categorized into polyether and polyester polyol. Polyether polyol dominated the industry in 2018 with a volume share of 75.9% in 2018. They are widely accepted owing to properties such as low viscosity, resistance to alkali medium, and low-temperature flexibility. In 2018, polyether derivatives witnessed a surge in prices across North America. While few sellers increased their prices by 13 cents/lb, others increased it by around 8-9 cents/lb. The increased price of propylene, which is a key raw material for producing polyether polyols, led to a considerable rise in the price of polyether polyols.
Polyester polyols are expected to register the fastest growth in terms of both revenue and volume. Rising application in the insulation industry is anticipated to be the primary factor driving this segment. The production of these chemicals faces a major threat from the U.S.-China trade war. The U.S. majorly imports polyester ethers, which is a major raw material used in the manufacturing of polyester polyols, from China.
The North American market is largely driven by demand from the automobile and construction industries. Increasing concerns over continuously rising energy costs have aided the importance of energy-efficient households. The adoption of favorable government regulatory trends to establish energy-efficient structures is expected to have a positive impact on market growth.
The U.S. dominated the market in 2018 and is anticipated to retain its lead over the forecast period. This is attributed to the presence of a strong distribution network for polyurethane products in the country. Also, increasing R&D activities related to high-performance materials based on renewable polyols will help the market hold on to its prime position. For instance, in March 2019, Covestro AG collaborated with Genomatica to boost R&D on renewable polyols.
Canada is globally the 10th largest passenger vehicle manufacturer. The industry employs over 125,000 people along with over 400,000 in the aftermarket ecosystem, marking a GDP contribution of USD 19 billion to the country’s economy. The country is benefitting from a large number of U.S. auto manufacturers outsourcing their manufacturing facilities. Foreign automakers that have a presence in Canada are Fiat Chrysler, Ford, General Motors, Honda, and Toyota. The presence of a large number of small-scale industries that produce polyurethane foam is expected to drive the demand over the forecast period.
The plastics industry has been a crucial economic driver for Mexico. The country is one of the key importers of rubber and plastic goods from the U.S. Although, the plastics industry has been growing at a moderate pace in the country over the last three years, plastic formulators are making their presence felt in the market space with increasing application in the automotive industry. The growth is aided by Mexico’s several free-trade agreements with vital economies of the globe.
Major industry participants in the region are Covestro, BASF, Lanxess, Huntsman Corporation, Mitsui Chemicals, and DowDuPont. The multinationals accounted for 55-60% of the overall market in North America in 2018. Key factors driving competition are product differentiation and market positioning. The market is consolidated to a moderate extent with the presence of large multinationals that bring in immense competition in terms of establishing advanced product portfolio, proper selection of distribution strategies, and marketing mix to sustain in the market space.
The market size value in 2019
USD 4.87 billion
The revenue forecast in 2025
USD 6.65 billion
CAGR of 5.6% from 2019 to 2025
The base year for estimation
2014 - 2017
2019 - 2025
Revenue in USD billion and CAGR from 2019 to 2025
Revenue forecast, company ranking, competitive landscape, growth factors, and trends
Product, application, region
U.S., Canada, Mexico
Key companies profiled
Covestro, BASF, Lanxess, Huntsman Corporation, Mitsui Chemicals, and Dow
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This report forecasts revenue growth at the regional and country-level and provides an analysis of the latest industry trends in each of the sub-segments from 2014 to 2025. For this study, Grand View Research has segmented the North America polyols market report based on the product, application, and country:
Product Outlook (Volume, Kilotons; Revenue, USD Million, 2014 - 2025)
Application Outlook (Volume, Kilotons; Revenue, USD Million, 2014 - 2025)
Adhesives & Sealants
Country Outlook (Volume, Kilotons; Revenue, USD Million, 2014 - 2025)
b. The North America polyols market size was estimated at USD 4.87 billion in 2019 and is expected to reach USD 5.14 billion in 2020.
b. The North America polyols market is expected to grow at a compound annual growth rate of 5.6% from 2019 to 2025 to reach USD 6.65 billion by 2025.
b. Rigid foam dominated the North America polyols market with a share of 33.6% in 2019. This is attributable to structural stability of polyol-based rigid foams which facilitate their use in transportation, packaging, industrial insulation, and appliances.
b. Some key players operating in the North America polyols market include Covestro, BASF, Lanxess, Huntsman Corporation, Mitsui Chemicals, and Dow.
b. Key factors that are driving the market growth include increasing demand for flexible polyurethane foams, which are used in applications such as upholstery, mattresses, and seats.
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