Polyols Market Size, Share & Trends Analysis Report By Product (Polyether, Polyester), By Application (Flexible Foam, Rigid Foam, Coatings, Adhesives & Sealants), And Segment Forecasts, 2018 - 2025

Report Overview

The global polyols market size to be valued at USD 45.17 billion by 2025 and is expected to grow at a compound annual growth rate (CAGR) of 8.5% from 2018 to 2025. Rising efforts for energy conservation are propelling demand for rigid foams with high insulation properties, particularly in the building and construction industry. This is expected to emerge as a significant factor driving the global market over the forecast period. Growth of the construction sector, primarily in Asia Pacific, to accommodate a rapidly burgeoning population is anticipated to boost product consumption in building components such as exterior panels, insulation protective materials, and housing electronics. Expanding automotive and packaging industries are also contributing toward market growth.

Furthermore, key manufacturers have been investigating bio-based polyols to reduce dependence on conventional petrochemical-derived polyols given rising environmental concerns and volatility in raw material prices. The nature of the vendor landscape is concentrated and oligopolistic. As of 2017, top manufacturers accounted for a share of over 45.0% in the market.

Different strategies adopted by market leaders have paved the path for smaller players to follow. Moreover, new entrants are seeking more significant opportunities in the global market for polyol products as well as polyurethane products such as foams, coatings, elastomers, and sealants. Companies attempting to establish themselves in the market have to compete with existing multinationals such as Huntsman International LLC, Eastman Chemical Corporation, DIC Corporation, Mitsubishi Chemical Corporation, Tosoh Corporation, Woodbridge Foam Corporation, and RTP Company.

Moreover, polyol suppliers are engaging in forward integration to produce polyurethane, thereby significantly reducing logistics costs and procurement hassles in the long run. Consumers are becoming increasingly aware regarding product benefits, which has compelled suppliers to maintain high-quality levels by integrating into the production stage.

Polyols Market Trends

The increasing demand for rigid and flexible polyurethane in the context of different application areas such as bedding, cushioning, carpets, making of the car seats, and other interiors drive the market. Polyols have application in the automotive industry, owing to the features such as low cost, enhanced hydrolytic stability, and increased demand for polyols.  Specifically, polyols are required in the energy conservation activities for the rigid foams with high insulation properties, within the construction market. Moreover, the increasing pace of industrialization has surged the use of polymers and other components in the loping countries.

Additionally, the use of polyols has been seen in various infrastructure development projects which are supported by government initiatives. The polyols are used as a special component within the food and beverage industry as well as a sugar replacement ingredient in different products such as candies, ice creams, fruit spreads, and yogurt.

There is a significant demand for polyols from the consumer products, electronics, footwear, and packaging industry determining a significant contribution to the overall market growth. Furthermore, polyols are widely used in building and construction activities. The rapid increase in the size of the population has surged the infrastructure and housing requirements. This is expected to create a robust growth opportunity for the market.

Product Insights

Globally, polyether polyols accounted for the largest market share in 2017. The segment is expected to continue its dominance over the forecast period. Polyether polyols have rebound properties, wear and tear resistance, and hydrolytic stability owing to which it is used to formulate rigid polyurethane foams. These are used by various end-use industries such as transportation, construction, furniture, and packaging.

Polyester polyols have high tensile strength and shock absorption properties owing to which they are extensively used in vibration dampening applications. Both polyether and polyester polyols are used in polyurethane, urethane, and polyisocyanurate applications. Increasing demand for PU-based foams and coatings, adhesives, sealants, and elastomers (C.A.S.E) from various end-use industries such as automotive, textile, insulation, packaging, electrical and electronics is projected to boost industry growth over the forecast period.  

Application Insights

Flexible foam emerged as the largest application segment in 2017 in the polyols market and accounted for a share of over 27.0% by volume that year. Flexible foams are widely utilized as cushioning material for furniture, bedding and mattresses, seating, and other soft products in several end-use industries such as furniture and mattress, automotive, handbag and luggage, footwear and textile, home appliances, engineering, and packaging.

Both polyether and polyester polyols are used to make flexible foams. These foams are produced with an average density of 1.5 to 3 lb/ft³. Flexible foam made with polyols exhibits high durability, resiliency, energy absorption, handling strength, enhanced thermal insulation, and excellent mechanical attributes, which are likely to support its demand from various industries over the forecast period.

Elastomers are expected to emerge as the fastest-growing application segment over the forecast period. Elastomers are polymers with the combined strength of plastic and elasticity of rubber. Polyol-based elastomers are used in molded rubber components in various industries including building and construction, apparels and footwear, automotive, packaging, furnishing, appliances, marine, medical, and electronics owing to their excellent chemical and mechanical properties, low cost, and high durability.

Regional Insights

Asia Pacific emerged as the largest regional market in 2017 with a share of over 45.0%. Growing automotive industry, along with increasing polymer consumption, is anticipated to remain a key factor driving the regional market. APAC is also likely to register the fastest growth over the forecast period.

Europe, led by Germany, U.K., and France, emerged as the second-largest polyols-consuming region in 2017. Increasing demand for insulation in low-income households to conserve energy efficiently, coupled with favorable regulatory support by governments, is anticipated to propel the demand for polyols in Europe.

Latin America is foreseen to emerge as the second fastest-growing regional market after Asia Pacific from 2018 to 2025. This can be attributed to the presence of various automotive OEMs, along with growth of the building and construction industry. Automobile manufacturers in the region are becoming increasingly competitive and are adopting polyurethane materials to lower production cost.   

Key Companies & Market Share Insights

Some of the prominent players are Covestro, BASF SE, The Dow Chemical Company, Shell, and Huntsman. Companies such as BASF, Dow Chemical, and Covestro have well-developed research and development facilities, along with a global footprint and a loyal customer base. Deploying large amounts of capital, gaining technical know-how, and establishing an efficient supply chain system are significant challenges for new entrants in the global market.

Automotive as well as building and construction industries in developing countries in Asia Pacific are expected to witness rapid growth in the coming years. India and China are projected to emerge as significant demand drivers in the global automotive market. Thus, polyol manufacturers and suppliers are increasingly focusing on this region. Some of the leading players operating in this market include:

• Covestro AG

• BASF SE

• The Dow Chemical Company

• Shell, and

• Huntsman

Recent Developments

• In March 2023, BASF started production of Sovermol®, its first bio-based polyol in Mangalore, India. The product meets the rapidly expanding need for eco-friendly goods in Asia Pacific for use in New Energy Vehicles (NEV), windmills, flooring, and protective industrial coatings.

• In September 2022, Covestro introduced more environmentally friendly polyether polyols based on bio-circular raw materials. Both essential elements for PU foams, together with isocyanates, are now obtainable using alternative raw materials.

Polyols Market Report Scope

Global Polyols Market Segmentation

This report forecasts revenue growth at global, regional, and country levels and provides an analysis on the latest industry trends in each of the sub-segments from 2014 to 2025. For the purpose of this study, Grand View Research has segmented the global polyols market report on the basis of product, application, and region.

• Product Outlook (Volume, Kilotons; Revenue, USD Million, 2014 - 2025)

  • Polyether

  • Polyester

• Application Outlook (Volume, Kilotons; Revenue, USD Million, 2014 - 2025)

  • Rigid Foam

  • Flexible Foam

  • Coatings

  • Adhesives & Sealants

  • Elastomers

  • Others

• Regional Outlook (Volume, Kilotons; Revenue, USD Million, 2014 - 2025)

  • North America

    • The U.S.

    • Canada

  • Europe

    • Germany

    • The U.K.

    • France

  • Asia Pacific

    • China

    • India

    • Japan

  • Latin America

    • Brazil

    • Mexico

  • Middle East & Africa

    • Saudi Arabia