Renewable and Bio-Based Alternatives: Trends for the Specialty Chemicals Industry in 2024

While the industry is growing rapidly, some traditional chemical manufacturing processes have been associated with contributing to adverse environmental impact. Issues such as pollution, waste generation, and high energy consumption have often been connected with chemical production.

With a focus on being more sustainable, the industry has begun implementing practices and developing innovative solutions to address these concerns. One of the most significant emerging trends shaping the industry’s future in sustainable chemical manufacturing is adopting renewable and biodegradable solutions.

A Shift Towards Renewable Alternatives

There is a shift towards renewable materials in the specialty chemicals manufacturing sector. Traditionally, the industry relied on fossil fuels as feedstocks for chemical production. However, with the growing concern of climate change and the depletion of fossil fuel reserves, there is a higher interest in utilizing renewable sources, such as biomass, algae, and agricultural waste, as alternative raw materials.

While focusing on renewable feedstocks in the industry, Data Bridge Market Research, a leading research and consulting firm, reported that the global renewable chemicals market, which was USD 17.50 billion in 2022, is expected to reach USD 70.89 billion by 2030, growing at a CAGR of 19.11 percent from 2023 to 2030. In fact, at COP28, the annual United Nations (UN) climate meeting, in Dubai, a key discussion underlined the need for the world to eventually do away with fossil fuels altogether. According to a report by Reuters, the global leading multimedia news provider, 118 governments, led by the European Union, United States, and UAE, pledged to triple the world's renewable energy capacity by 2030.

The Growing Importance of Bio-Based Alternatives

The need to reduce carbon emissions and create more sustainable products has increased demand for bio-based products. In addition to reducing the dependency on fossil fuels, bio-based alternatives also provide lower carbon emissions and improved biodegradability.

The chemicals designed to be biodegradable do not remain in the environment for extended periods and prevent the accumulation of harmful substances in soil, water, and air, allowing them to minimize long-term environmental pollution and maintain ecological balance. The alternative options for the specialty chemicals industry include biofuels, bioplastics, and biochemicals.

Another key focus is eco-friendly packaging. This sustainable approach to packaging is to use recycled materials or biodegradable materials to minimize the amount of waste that ends up in the environment.

According to Fortune Business Insights, a leading provider of market research data and analysis, the global bio-based chemicals market is projected to grow from USD 77.10 billion in 2021 to USD 144.63 billion in 2028 at a CAGR of 9.4 percent in the forecast period.