February 21, 2024

The global Furfural Market Growth is Driven by Renewable Chemicals Demand

Furfural is a biomass-derived organic compound that finds applications in a variety of industries, including refineries, chemical, petroleum and agriculture. It acts as an intermediate chemical for the production of other derivatives such as furfuryl alcohol, tetrahydrofurfuryl alcohol and furan resins. Furfural is produced commercially from agricultural residues and waste materials that contain pentose sugars through enzymatic or chemical decomposition at high temperatures. As concerns over depleting fossil fuel reserves and environmental pollution rise, there is increasing focus on developing bio-based and renewable chemicals. The growing demand for green chemicals is driving the furfural market.

The global furfural market is estimated to be valued at US$ 625.21 million in 2023 and is expected to exhibit a CAGR of 7.0% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.

Market key trends:

One of the key trends in the furfural market is the shift towards sustainable production methods. Traditionally, furfural has been produced from corncobs through steam cracking, which is a highly energy-intensive process. However, with heightened environmental consciousness, manufacturers are investing in innovative technologies and processes that utilize agricultural residues more efficiently with lower carbon footprint. Some examples include developing integrated biorefineries that produce furfural along with other high-value compounds from biomass waste, and employing new pretreatment techniques prior to thermal decomposition for higher furfural yields. The focus on eco-friendly production of furfural and its derivatives from renewable feedstock is expected to drive market growth over the forecast period.

Porter’s Analysis

  • Threat of new entrants: The threat of new entrants in the furfural market is moderate as setting up a furfural production plant requires high capital investment along with technologies to process raw materials efficiently at large scale. However, presence of key players in developing economies with increasing demand provides opportunities for new players to enter the market.
  • Bargaining power of buyers: The bargaining power of buyers in the furfural market is moderate as it is fragmented with presence of multiple global as well as regional buyers. Buyers can negotiate on pricing but have limited influence over quality standards and product differentiation offered by manufacturers.
  • Bargaining power of suppliers: The bargaining power of suppliers is moderate due to availability of raw materials from multiple sources globally. However, key raw materials include agricultural waste and by-products whose prices fluctuate based on availability and demand seasons impacting production costs for suppliers.
  • Threat of new substitutes: The threat of substitutes is low as furfural has limited substitutes for its diverse applications across industries. Continuous research and product development is being done to further expand furfural’s scope of use minimizing threat from any potential substitutes.
  • Competitive rivalry: The competitive rivalry in the market is high due to presence of numerous international and domestic players offering similar product profiles. Players differentiate based on raw material sourcing, production capacities, and expansion strategies to gain higher market shares.

Key Takeaways

The global furfural market is expected to witness high growth over the forecast period supported by increasing applications across diverse industries. The global furfural market is estimated to be valued at US$ 625.21 million in 2023 and is expected to exhibit a CAGR of 7.0% over the forecast period 2023 to 2030.

Asia Pacific currently dominates the market and is expected to maintain its lead during the forecast period supported by growing production capacities and demand from China, India, and other developing economies in the region. Countries like India are also witnessing significant growth in demand and indigenous production. On the other hand, North America and Europe are relatively mature markets but hold opportunities for advanced applications of furfural in chemicals and petroleum refining industries.

Key players: Key players operating in the furfural market are Illovo Sugar Africa (Pty.) Ltd, Linzi Organic Chemical Inc. Ltd., Trans Furans Chemicals bvba, Central Romana Corporation, DalinYebo, Hebeichem, KRBL Ltd., Silva team S.p.a., and LENZING AG. Players are focusing on expanding production capacities especially in Asia to cater increasing regional demand for furfural. They are also investing in research & development of diversified applications of furfural.

*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it