Butanol Market - Forecast(2023 - 2028)

Report Code: CMR 1490 Report Format: PDF + Excel

Butanol Market Overview

Butanol market size is forecasted to reach US$17.4 billion by 2027, after growing at a CAGR of 5.2% during the forecast period 2022-2027. Butanol has the formula C4H9OH and is four-carbon alcohol. Bio-based butanol is often manufactured using the acetone-butanol-ethanol (ABE) fermentation process. Butanol has several advantages over ethanol as a bio-fuel due to its lower vapor pressure, lower hydrophilicity, and higher energy density, owing to which its market demand is increasing. The growth can also be attributed to the increasing demand for paint thinners, coating resins, lubricants, rubbers, glycol ethers, butyl acrylate, plastics, and more from the bolstering building & construction, and transportation industry across various regions. Additionally, increased demand for butanol in the application relating to home & industrial cleaning and chemical intermediates are expected to further drive the market growth over the forecast period. The novel coronavirus pandemic had negative consequences in a variety of butanol end-use industries. The production halt owing to enforced lockdown in various regions resulted in decreasing demand and consumption of butanol, which had a direct impact on the butanol industry's growth.

Report Coverage

The report: “Butanol Market Report – Forecast (2022-2027)”, by IndustryARC, covers an in-depth analysis of the following segments of the butanol industry.

By Type: N-butanol, 2-butanol, Iso-butanol, and Tert-butanol.
By Feedstock: Conventional and Biobased.
By Packaging: Drums, Bottles, Bags, and Others.
By Application: Coating Resins, Butyl Carboxylates (Glycol Ethers, Butyl Acetate, and Butyl Acrylate), Direct Solvent Use, Plasticizers, Fuels & Lubricants, and Others.
By End-Use Industry: Paints & Coatings, Chemical & Petrochemical, Textile, Agriculture, Building & Construction (Commercial, Residential, Industrial, and Infrastructure), Food & Beverages, Transportation [Aerospace, Automotive (Passenger Vehicle, Light Commercial Vehicle, and Heavy Commercial Vehicle), Marine, and Locomotive], Pharmaceutical, Personal Care (Hair Care, Body Care, and Others), Cleaning Industry (Home and, Industrial), Plastics & Rubber Industry, and Others.
By Geography: North America (USA, Canada, and Mexico), Europe (UK, Germany, France, Italy, Netherlands, Spain, Belgium, and Rest of Europe), Asia-Pacific (China, Japan, India, South Korea, Australia and New Zealand, Indonesia, Taiwan, Malaysia, and Rest of APAC), South America (Brazil, Argentina, Colombia, Chile, and Rest of South America), Rest of the World (Middle East, and Africa)

Key Takeaways

  • Asia-Pacific dominates the butanol market, owing to the growing transportation industry in the region. The increasing per capita income and evolving lifestyle of individuals coupled with the rising population are the major factors expanding the transportation industry in Asia-Pacific.
  • The reduction of carbon emissions to a large extent and its growing prominence as a building block for chemical manufacturing are two major factors driving the butanol market studied.
  • Bio-butanol is gaining popularity as a green alternative to petroleum-based fuels. Because of its high energy content, it is preferred as a superior automobile fuel over bioethanol, which is assisting market growth.
  • The market for motor fuel is expected to be driven by the growing number of cars on the road and increasing vehicle sales, as a result of which fuel, lubricants, and coatings demand are expected to increase, which could boost the butanol market in the coming years.
  • In addition, as the demand for coatings resin is growing, various paint manufacturers are expanding their product lines, which is expected to continue to drive market growth.

Figure: Asia-Pacific Butanol Market Revenue, 2021-2027 (US$ Billion)

Butanol Market

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Butanol Market Segment Analysis – By Type

The N-butanol segment held the largest share of 82% in the butanol market in 2021 N-Butanol, also known as 1 butanol or butyl alcohol, is an alcohol made from corn sugars through petrochemical processes or fermentation. N-butanol is a better fuel alternative than ethanol because it has more energy, is more compatible with the gasoline structure, does not absorb water from the environment, and is non-corrosive. Researchers have been looking into n-butanol as a biofuel alternative to bioethanol in recent years. Because it has many advantages over ethanol, such as higher energy content, lower volatility, and does not readily absorb moisture, straight-chain alcohol (n-butanol) is considered the next generation biofuel. Another advantage is that butanol has twice as many carbon atoms as ethanol. As a result, n-butanol demand is substantially increasing when compared with other types of butanol, thereby significantly riving the n-butanol market growth.

Butanol Market Segment Analysis – By Packaging

The drum segment held the largest share in the butanol market in 2021 and is forecasted to grow at a CAGR of 5.8% during the forecast period 2022-2027. Drums, such as plastic, steel, and fiber drums, are ideal for storing and transporting butanol. As bottles and bags are less capable of holding or transferring chemical materials, steel and plastic drums are frequently used for butanol packaging. In addition, because of their versatility, steel and fiber drums are an excellent choice for storing and transporting large or bulk quantities of butanol. They're also simple to palletize and wrap, making them an excellent choice for butanol bulk shipping. All of these advantages of using plastic, steel, and fiber drums as packaging are gaining segment traction.

Butanol Market Segment Analysis – By End-Use Industry

The transportation segment held a significant share in the butanol market in 2021 and is forecasted to grow at a CAGR of 5.5% during the forecast period 2022-2027. Butanol is often used as an intermediate to manufacture bio-fuels and paints, which are then widely utilized in the transportation sector in automobiles, aircraft, ships, and trains. Bio-fuel is biodegradable, non-toxic, and produces fewer pollutants when burnt completely, owing to which consumers are shifting towards butanol-based bio-fuels. The transportation industry is flourishing in various countries, for instance, according to the UK Government, 38,000 large passenger aircraft worth around £4.65 trillion are needed globally over the next 20 years. According to India Brand Equity Foundation (IBEF), the Indian automotive industry is expected to reach Rs. 16.16-18.18 trillion (US$ 251.4-282.8 billion) by 2026. This is directly supporting the butanol market growth in the transportation industry.

Butanol Market Segment Analysis – By Geography

Asia-Pacific region held the largest share in the butanol market in 2021 up to 51% and is forecasted to grow at a CAGR of 6.4% during the forecast period 2022-2027, owing to the bolstering growth of the transportation sector in Asia-Pacific countries. The Asia-Pacific transportation industry is growing, for instance, in November 2020, Boeing forecasted that China's airlines would spend US$1.4 trillion on 8,600 new planes and US$1.7 trillion on commercial aircraft services over the next 20 years. In May 2021, Australia’s Victoria Government is set to invest nearly US$768.49 million (A$986m) to build 25 new X’Trapolis 2.0 trains for strengthening the public rail network. While the complete design work is already underway, the trains will enter the production stage next year. According to India Brand Equity Foundation (IBEF), From FY16 to FY20, India's domestic automobile production grew at a 2.36 percent compound annual growth rate (CAGR), with 26.36 million vehicles produced in FY20. Domestic auto sales increased at a 1.29 percent compound annual growth rate (CAGR) between FY16 and FY20, with 21.55 million vehicles sold in FY20. According to the Japan Automobile Manufacturers Association (JAMA), car production in Japan increased in November, rising from 6,67,462 units in October to 6,90,311 units in November. And with the increasing production of vehicles, it is anticipated that the demand for bio-fuels and paints will significantly increase, which will accelerate the demand for the butanol market in Asia-Pacific over the forecast period.

Butanol Market Drivers

Government Initiatives Bolstering the Growth of the Building & Construction Sector

Butanol-based paints, coatings, rubbers, and polymers are often employed in buildings in applications such as windows, walls, doors, floors, and more. The governments are taking initiatives to increase the building & construction activities. For instance, Kansai International Airport in Japan will spend about 100 billion yen ($911 million) by 2025 to upgrade the larger terminal, to increase space for international flights at the country's No. 2 hub. As part of the Centre's Udan scheme to assist with growing air traffic, the Indian Union Budget of February 2020 seeks to build 100 new airports by 2024. Over the medium term, R4.6 billion has been allocated to the health facility revitalization component of the national health insurance indirect grant in South Africa (2020-2021). A portion of this budget will be used to plan and build the Limpopo Central Hospital in Polokwane, which is scheduled to open in 2025/26. The Ministry of Housing and Urban Development (MoHUA) has been given Rs 50,000 crore (US$6.8 billion), and a fund of Rs 25,300 crore (US$3.5 billion) has been set up to help complete stalled housing projects. The Indian government has launched a project called the “Pradhan Mantri Awas Yojana (PMAY) program”, which aims to provide affordable housing to all urban poor people by 2022 through financial assistance. Such government initiatives are set to increase the demand for paints, coatings, rubbers, and polymers in the residential construction sector, and further drive the butanol market growth during the forecast period.

Bolstering Growth of Personal Care and Food & Beverage Sector

Butanol is often used in the personal care & cosmetics and food & beverage industry as a solvent in pharmaceuticals and a flavoring agent in foods. Due to rising consumer demand and increasing per-capita income of individuals, the personal care & cosmetics and food & beverage industry is booming in various regions. For instance, according to the India Brand Equity Foundation (IBEF), the beauty, cosmetics, and grooming market in India in 2025 will reach US$20 billion. According to the International Trade Administration, Thailand's beauty and personal care goods market was valued at around US$6.2 billion in 2018 and is projected to grow to US$8.0 billion by 2022. Thailand's beauty and personal care sector is projected to grow at a rate of 7.3 percent per year from 2019 to 2022. According to the China Chain Store & Franchise Association, the food and beverage (F&B) sector in China reached $595 billion in 2019, up 7.8% from 2018. According to the United States Department of Agriculture (USDA), Italy’s food retail sales reached US$175 billion in 2020, 5.6 percent more than in 2019. While online grocery shopping grew by 134.4 percent. Since the personal care & cosmetics and food & beverage sector industries are booming, the demand for butanol is also significantly increasing. Thus, the increasing personal care & cosmetics and food & beverage sector act as a driver for the butanol market during the forecast period.

Butanol Market Challenges

Production and Utilization of Bio-butanol

Bio-butanol has many production and utilization barriers associated with it, for illustration, bio-butanol is produced in small quantities. The yield of bio-butanol produced by ABE fermentation is lower than that of bio-ethanol produced by yeast ethanol fermentation. Although bio-butanol has a higher energy density than other low-carbon alcoholic biofuels, its heating value is still lower than that of real gasoline or diesel fuel, so when used as a fossil fuel substitute, the fuel flow must be increased. In addition, because bio-butanol is an alcohol-based fuel, it may be incompatible with some fuel system components and cause inaccurate gas gauge readings in vehicles equipped with capacitance fuel level gauging. Due to its lower octane number, bio-butanol may produce more greenhouse gas emissions per unit of motive energy extracted than bio-ethanol. A higher-octane number indicates a higher compression ratio and efficiency, and a higher engine efficiency results in fewer greenhouse gas emissions. When used in Spark-ignition engines, the higher viscosity of bio-butanol could cause corrosive or aggravation problems. During the forecast period, all of these production and utilization barriers of biobutanol are expected to be one of the major factors limiting the butanol market growth.

Butanol Industry Outlook

Technology launches, acquisitions, and R&D activities are key strategies adopted by players in the Butanol market. Butanol market top 10 companies are:

  1. Eastman Chemical Company
  2. Mitsubishi Chemical Corporation
  3. Dow
  4. SABIC
  5. Galaxy Chemicals
  6. KH Chemicals
  7. Solventis
  8. KH Neochem Co., Ltd.
  9. OQ Chemicals GmbH
  10. China National Petroleum Corporation (CNPC)

Recent Developments

  • In November 2021, Microbes can now be tasked with making n-butanol in a new way, according to researchers at Washington University in St. Louis. Rhodopseudomonas palustris TIE-1 (TIE-1) has been modified by a team of biologists and engineers to produce biofuel using only three renewable and naturally abundant source ingredients: carbon dioxide, solar-panel-generated electricity, and light. The resulting biofuel, n-butanol, is a carbon-neutral alternative to diesel and gasoline that can be blended.
  • In October 2021, ADM and Gevo have signed a memorandum of understanding (MoU) to collaborate on the development of sustainable aviation fuel (SAF) and other low-carbon hydrocarbon fuels. The MoU envisions producing ethanol and isobutanol, which would then be converted into renewable low-carbon hydrocarbons, such as SAF, using Gevo's processing technology and capabilities.
  • In July 2021, A group of researchers from South Korea's Gwangju Institute of Science and Technology developed a method for directly generating 1-butanol from CO2 using the electrochemical reduction reaction (CO2RR) and copper phosphide (CuP2) without the need for CO dimerization.

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1. Butanol Market- Market Overview
    1.1 Definitions and Scope
2. Butanol Market- Executive Summary
    2.1 Key Trends by Type
    2.2 Key Trends by Feedstock
    2.3 Key Trends by Packaging
    2.4 Key Trends by Application
    2.5 Key Trends by End-Use Industry
    2.6 Key Trends by Geography
3. Butanol Market – Comparative analysis
    3.1 Market Share Analysis- Major Companies
    3.2 Product Benchmarking- Major Companies
    3.3 Top 5 Financials Analysis
    3.4 Patent Analysis- Major Companies
    3.5 Pricing Analysis (ASPs will be provided)
4. Butanol Market - Startup companies Scenario Premium Premium
    4.1 Major startup company analysis:
        4.1.1 Investment
        4.1.2 Revenue
        4.1.3 Product portfolio
        4.1.4 Venture Capital and Funding Scenario
5. Butanol Market – Industry Market Entry Scenario Premium Premium
    5.1 Regulatory Framework Overview
    5.2 New Business and Ease of Doing Business Index
    5.3 Successful Venture Profiles
    5.4 Customer Analysis – Major companies
6.Butanol Market - Market Forces
    6.1 Market Drivers
    6.2 Market Constraints
    6.3 Porters Five Force Model
        6.3.1 Bargaining Power of Suppliers
        6.3.2 Bargaining Powers of Buyers
        6.3.3 Threat of New Entrants
        6.3.4 Competitive Rivalry
        6.3.5 Threat of Substitutes
7. Butanol Market – Strategic Analysis
    7.1 Value Chain Analysis
    7.2 Opportunity Analysis
    7.3 Product/Market Life Cycle
    7.4 Distributor Analysis – Major Companies
8. Butanol Market - By Type (Market Size -US$ Million/Billion)
    8.1 N-butanol
    8.2 2-butanol
    8.3 Iso-butanol
    8.4 Tert-butanol
9. Butanol Market - By Feedstock (Market Size -US$ Million/Billion)
    9.1 Conventional
    9.2 Biobased
10.Butanol Market - By Packaging (Market Size -US$ Million/Billion)
    10.1 Drums
    10.2 Bottles
    10.3 Bags
    10.4 Others
11.Butanol Market - By Application (Market Size -US$ Million/Billion)
    11.1 Coating Resins
    11.2 Butyl Carboxylates
        11.2.1 Glycol Ethers
        11.2.2 Butyl Acetate
        11.2.3 Butyl Acrylate
    11.3 Direct Solvent Use
    11.4 Plasticizers
    11.5 Fuels & Lubricants
    11.6 Others
12.Butanol Market - By End-Use Industry (Market Size -US$ Million/Billion)
    12.1 Paints & Coatings
    12.2 Chemical & Petrochemical
    12.3 Textile
    12.4 Agriculture
    12.5 Building & Construction
        12.5.1 Commercial
        12.5.2 Residential
        12.5.3 Industrial
        12.5.4 Infrastructure
    12.6 Food & Beverages
    12.7 Transportation
        12.7.1 Aerospace
        12.7.2 Automotive
            12.7.2.1 Passenger Vehicle
            12.7.2.2 Light Commercial Vehicle
            12.7.2.3 Heavy Commercial Vehicle
        12.7.3 Marine
        12.7.4 Locomotive
    12.8 Pharmaceutical
    12.9 Personal Care
        12.9.1 Hair Care
        12.9.2 Body Care
        12.9.3 Others
    12.10 Cleaning Industry
        12.10.1 Home
        12.10.2 Industrial
    12.11 Plastics & Rubber Industry
    12.12 Others
13. Butanol Market - By Geography (Market Size -US$ Million/Billion)
    13.1 North America
        13.1.1 USA
        13.1.2 Canada
        13.1.3 Mexico
    13.2 Europe
        13.2.1 UK
        13.2.2 Germany
        13.2.3 France
        13.2.4 Italy
        13.2.5 Netherlands
        13.2.6 Spain
        13.2.7 Belgium
        13.2.8 Rest of Europe
    13.3 Asia-Pacific
        13.3.1 China
        13.3.2 Japan
        13.3.3 India
        13.3.4 South Korea
        13.3.5 Australia and New Zealand
        13.3.6 Indonesia
        13.3.7 Taiwan
        13.3.8 Malaysia
        13.3.9 Rest of APAC
    13.4 South America
        13.4.1 Brazil
        13.4.2 Argentina
        13.4.3 Colombia
        13.4.4 Chile
        13.4.5 Rest of South America
    13.5 Rest of the World
        13.5.1 Middle East
            13.5.1.1 Saudi Arabia
            13.5.1.2 UAE
            13.5.1.3 Israel
            13.5.1.4 Rest of the Middle East
        13.5.2 Africa
            13.5.2.1 South Africa
            13.5.2.2 Nigeria
            13.5.2.3 Rest of Africa
14. Butanol Market – Entropy
    14.1 New Product Launches
    14.2 M&As, Collaborations, JVs and Partnerships
15. Butanol Market – Industry/Segment Competition Landscape Premium
    15.1 Company Benchmarking Matrix – Major Companies
    15.2 Market Share at Global Level - Major companies
    15.3 Market Share by Key Region - Major companies
    15.4 Market Share by Key Country - Major companies
    15.5 Market Share by Key Application - Major companies
    15.6 Market Share by Key Product Type/Product category - Major companies
16. Butanol Market – Key Company List by Country Premium Premium
17. Butanol Market Company Analysis - Business Overview, Product Portfolio, Financials, and Developments
    17.1 Company 1
    17.2 Company 2
    17.3 Company 3
    17.4 Company 4
    17.5 Company 5
    17.6 Company 6
    17.7 Company 7
    17.8 Company 8
    17.9 Company 9
    17.10 Company 10 and more
"*Financials would be provided on a best efforts basis for private companies"