Bio-Based Polyurethane Market – Global Industry Analysis and Forecast | 2025

Polyurethanes are used in a wide range of industrial applications due to their chemical versatility, high performance and low cost. They find use in building and construction, consumer products, furniture and fixtures, transportation and in industrial applications. Polyurethane is traditionally a downstream derivative of crude oil, rendering it susceptible to the crude oil market fluctuations. Moreover in this age of the consumers, and the global inclination towards green products and sustainable development, bio based alternative for crude oil is the need of the day.

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Polyurethane manufacturers are looking for alternatives so as to reduce carbon footprint, and at the same time positively impact the product quality and economics of production. Thermoplastic polyurethane manufacturers in particular are more inclined towards adopting bio based alternatives and increase the bio based content in their product by using polyester polyols made from natural and renewable raw materials. The main demand for bio based polyurethane is derived from application segments such as automotive, footwear and apparel. Uses in applications such as electronics, carpets, and furniture among others are also gaining momentum.

Adipic acid, which is petroleum based product, and some other di-acids are the conventional raw materials for manufacturing polyurethanes. However, natural oil polyols (NOP) or biopolyols, which are derived from vegetable oils by different methods, are used in the production of bio based polyurethane. The most common sources of natural oil polyols are castor oil, soy oil, peanut oil and canola oil. Castor oil accounts for the majority of natural oil polyol as it contains a ready hydroxyl group unlike the others, where hydroxyl group needs to be introduced by prior processes. Natural oil polyols have similar origins and applications but the materials are different depending on their manufacturing process. Apart from these bio based succinic acid and 1,4 butanediol can be combined with the required isocyanates to produce polyurethanes with upto 70% bio content.

One of the major factors driving this market is the government regulations regarding carbon foot print control in the developed economies of North America and Europe. In order to meet manufacturing obligations set up by the Kyoto Protocol, that is to reduce carbon emission so as to negate future climate damage, adapting to bio alternative from petroleum in the way forward for most manufacturers. Moreover research suggests that the physical attributes of bio based polyurethanes is strikingly similar to the traditional polyurethane manufactured from crude oil. Moreover, the modern customer prefers bio based green products to traditional products obtained from petroleum. Green product status has become the USP for products and brands.

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Application of bio based polyurethanes in the insulation industry is a major opportunity for the market. Polyurethane foams are extensively used in home insulation and building insulation in the US and Europe. Bio based polyurethane has the potential to capture the insulation market. Polyurethanes market suffers from the regular price fluctuations in the global crude oil market, as it is directly related to the product. The volatile crude oil market is a restraint for traditional polyurethanes as it affects the pricing and market competitiveness compared to other insulation materials such as fiber glass and mineral-wool. Insulation materials manufactured from bio based polyurethanes will not be affected by the global price fluctuations and is a better alternative both financially and environmentally for manufacturers and consumers alike.

Some of the players in the bio based polyurethanes market are SNP, Inc.,Cargill, Bio Amber, Inc, and Myriant Technologies among many others.

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