Bio-Based Chemicals Market Report Scope & Overview:

The Bio-Based Chemicals Market size was valued at USD 70.5 Billion in 2023. It is expected to grow to USD 167.6 Billion by 2032 and grow at a CAGR of 10.1% over the forecast period of 2024-2032.

The usage of bio-based chemicals in the packaging of consumer goods is a crucial factor driving the growth of the bio-based chemicals sector due to increased demand for sustainable, eco-friendly, and alternative solutions to conventional packaging such as plastic packaging. With consumers and businesses exercising more choice based on their carbon footprint, there is an increasing demand for biodegradable, compostable, or recyclable packaging rather than traditional petroleum-based plastics. Biobased packages from comestibles assets primarily based totally on maize starch, sugarcane, and plant fibers offer an opportunity with their slower improvement time and reduced squandering via way of means of lessening reliance upon fossil fuels. It is more prevalent in sectors like food and beverage, cosmetics, and consumer goods that are adopting bio-based materials such as polylactic acid (PLA), polyhydroxyalkanoates (PHA), and bio-based polyethylene (bio-PE).

In 2021, the U.S. Department of Agriculture (USDA) introduced a program aimed at funding the development and commercialization of bio-based products, including packaging materials.

Development of biotechnology and research & development (R&D) have highly contributed to the growth of the bio-based chemicals market. In recent years, major advances in biotechnology have enabled the cost-effective production of bio-based chemicals from renewable resources such as plant sugars, agricultural waste, or even the use of algae. Recent advances in fermentation technology, enzyme engineering, and genetic modification have enabled the large-scale production of bio-based chemicals with price parity with well-established petrochemical-based alternatives, generating a market for bio-based chemicals that can compete on performance. Such developments in microbial fermentation microorganisms harnessed to transform biomass into economically valuable chemical intermediates have made bio-based polyethylene terephthalate (PET) and bioplastics production more efficient, for example.

The U.S. Department of Energy (DOE) has been a key player in advancing biotechnology for bio-based chemical production. Through its Bioenergy Technologies Office (BETO), the DOE has invested over $200 million annually in bioenergy R&D, which includes the development of bio-based chemicals and biofuels from renewable resources.

Bio-Based Chemicals Market Dynamics

Drivers

• The growing popularity of bio-based polymers and plastics drives the market growth.

An increase in bio-based plastic and polymer production is one of the main drivers of the bio-based chemicals market, as this type of material is easier to decompose than traditional petroleum-based plastics, and consumers are more inclined to purchase a product with a lower environmental impact. A class of polymers including polylactic acid (PLA), polyhydroxyalkanoates (PHA), and bio-based polyethylene (bio-PE), among others, these bio-based polymers are produced from renewable resources (often corn, sugarcane, or algae) and are often more biodegradable than petroleum-based counterparts. This change is a result of growing awareness of the environmental issues associated with plastic waste and its negative effects on the environment and ecosystems. Consumers are increasingly becoming aware of environmental issues and focusing on bio-based plastic products, with the packaging, automotive, and textile industries looking to utilize bio-based plastics. Furthermore, several governments are starting strict initiatives on plastic ban and their disposal, which in turn, is prompting the manufacturers to shift towards bio-based materials. As an example, the emphasis on curtailing single-use plastics and recycling and sustainability initiatives of the European Union have supported demand for bio-based polymers. In addition, advances in bio-based polymer production have enhanced the efficiency and cost-effectiveness of these materials, facilitated their accessibility and commercial scalability, and fuelled their adoption. Bio-based polymers and plastics account for primary bio-based ongoing research due to the growing bio-based market potential, and it is proposed to be one of the bio-based chemical contributors for long-term development.

Restraint

• Limited availability of raw materials may hamper the market growth.

Raw material availability is a crucial restraining factor of the bio-based chemicals market since the availability of raw materials directly affects the production capacity and scalability of bio-based chemicals. The precursors for bio-based chemicals are usually produced from renewable resources, such as plant sugars, agricultural residues, and biomass, Incapacity to scale the production of these precursors due to seasonal variability, competition for land, and disruptions in the supply chain. However, production of feedstocks depends on crops such as corn, sugarcane, and some soybeans which can easily experience supply outages, especially with drought, bad harvests, or priorities from agriculture changes. Other industries such as food and animal feed are competing for these raw materials, which also constrains the potential for these feedstocks in bio-based chemical production. However, the increasing demand for bio-based chemicals in sectors like packaging, automotive, and consumer goods, makes it worse, as the number of raw materials may not meet the ever-increasing demand.

Bio-Based Chemicals Market Segmentation  

By Product

Surfactants held the highest share of 32% in 2023. This is owing to extensive applications in personal care, household cleaning, agriculture, and industrial applications. Surfactants are the key components of many products, ranging from shampoos to soaps, detergents, and disinfectants that reduce interfacial tension between different phases of a reaction mixture to spread uniformly and play an important role in cleaning, emulsification, and foaming. The growing concern for the environment and the need for green and non-toxic cleaning products has driven major whitespace towards the use of bio-based surfactants, which are now produced based on renewable raw materials such as vegetable oils, sugars, fatty acids, etc. These bio-sourced surfactants equal or outperform traditional petrochemical-based surfactants but are biodegradable and less polluting. In addition, with consumers becoming more educated about environmental and health problems, they are also seeking safe and sustainable raw materials in their household & personal care goods.

By Application

 Industrial held the largest market share around 52% in 2023. This is owing to the wide range of applications of bio-based chemicals in the manufacturing processes including textiles, automotive, coatings, and construction. In industrial applications, millions of tons of chemicals are needed and sustainable development has become a highly prioritized subject in the industrial field, prompting businesses to find more bio-based alternatives for achieving a lower ecological footprint. We now have bio-based chemicals, solvents, lubricants, and surfactants that perform as well or superior to their petrochemical counterparts but are made from renewable resources. This is why they would seem a target for industries wishing to comply with the draconian regulatory requirements being threatened on sustainability and carbon emissions.

Bio-Based Chemicals Market Regional Analysis

Europe held the largest market share around 59% in 2023. It is specially driven by most of the well-equipped infrastructure for bio-based production. European countries, particularly those in the EU, have been leaders in the sustainability space, implementing the European Green Deal, Circular Economy Action Plan, and other policies to cut carbon and increase renewable resource use. Such regulations provide a strong push for industries to switch to bio-based chemicals by setting tight boundaries on emissions and forcing industries to migrate away from fossil-based raw material feedstock. Finally, the existing strong research and development base in Europe has led to further bio-based sector innovations, with significant public/private investments in biochemicals. It hosts several global bio-based chemicals leaders like BASF and DSM that are ramping up efforts to ensure bio alternatives find commercial footing across packaging, agriculture, and automotive sectors. Furthermore, in Europe, where there is high awareness on environmental and health concerns, there is high consumer demand for eco-friendly products. Due to the rigid government policies, increasing demand for green products, and scalable and matured R&D infrastructure, Europe ranks first in the bio-based chemicals market, and it is poised to maintain its dominant position in the bio-based chemicals market throughout the forecast period owing to the evolving sustainability objectives eventually driving the growth.

Key Players

• BASF SE (Bio-based Polyethylene, Polylactic Acid)

• DuPont (Bio-based Propylene Glycol, Sorona)

• Cargill (Bio-based Polyurethane, Bio-based Propylene Glycol)

• DSM (EcoPaXX, Bio-based Susterra Propanediol)

• NatureWorks LLC (Ingeo Biopolymer, Ingeo Biocomposite)

• Genomatica (Butylene Glycol, Bio-butadiene)

• Braskem (Green PE, Green Polypropylene)

• Corbion (Lactic Acid, PLA Resin)

• Metabolic Explorer (1,3-Propanediol, Bio-based Acids)

• Novozymes (Bioethanol, Bio-based Enzymes)

• Evonik Industries AG (C13 and C16 Alcohols, Bio-based Surfactants)

• Solvay (Bio-based Epichlorohydrin, Bio-based Polymers)

• Unilever (Plant-based Surfactants, Bio-based Cleaning Products)

• Algenol (Bioethanol, Algenol Biofuels)

• LyondellBasell (Bio-based Polyethylene, Bio-based Butadiene)

• Sucden Group (Bio-based Chemicals, Bioethanol)

• Pirelli (Bio-based Rubber, Bio-based Polymers)

• Arkema (Bio-based Hydrogen Peroxide, Bio-based Acrylics)

• Dow Chemical (Bio-based Polyols, Bio-based Polymers)

• Mitsubishi Chemical (Bio-based Polyester, Bio-based Polycarbonate)

Recent Development:

• In 2024, BASF has continued to expand its portfolio of bio-based chemicals with the launch of "Verbund" sustainable solutions. The company introduced new bio-based polyamides, designed for use in automotive and industrial applications, which are derived from renewable resources.

• In 2023, DSM expanded its bio-based product offerings by launching a new line of bio-based vitamin D ingredients derived from sustainable sources. DSM also partnered with Covestro to develop bio-based polymers and coatings, further strengthening its position in the bio-based chemicals market.