The global Butanediol Market was valued at USD 10.4 Billion in 2022 and is projected to reach USD 29 Billion by 2032, at a CAGR of 11.5% during the forecast period. The growing demand of butanediol from textile industry along with increasing consumption in automotive industry is further projected to drive the global butanediol market.

Poly Butylene Terephthalate (PBT) is considered amongst the top five engineering plastics. It is one of the strongest, toughest, lightweight and versatile semi-crystalline polymers. Properties such as good dimensional stability, low water absorption, high stiffness and good heat resistance makes it a good contender for automotives, extrusion and electrical & electronics application. Other applications where PBT is consumed in smaller amounts include consumer goods and medical.

The reinforced resins show good resistance to oxidation in hot condition with relatively low water absorption. Global consumption of PBT was over 1,000 Kilo tons in 2022 and is estimated to grow at a CAGR of 4.5% during the forecast period. Engineering plastics in comparison to other standard commodity plastics have significantly better mechanical properties including high heat resistance, dimensional stability, strength and resistance to a wide range of chemicals.

GBL and PU are other major applications of BDO. GBL is an immediate downstream product Butanediol and it find its use in personal care & cosmetics, agrochemicals, pharmaceuticals, textiles and also used in manufacturing of PCB.

Polyurethane elastomers (TPU) are used in various end-uses such as footwear & sporting goods, automotive, building & construction, industrial products, wire & cable, and medical products. It is also used in small volumes in adhesives & sealants, aerospace and marine equipment. TPU offers exceptional benefits by bridging the gap between flexible rubber and rigid plastics. The biggest market and application outlet for TPU is the footwear & sporting goods industry currently accounting for 40% of the global demand. In the footwear industry, TPU has seen rapid growth as the market has moved towards high performance sports shoes and more recently as a result of increasing fashion trends for footwear with thicker soles. The primary driver for growth in demand of TPU in Asia-Pacific has been the migration of labour intensive downstream conversion industries, shifting of footwear production from developed high labour cost regions like North America and Western Europe, apart from burgeoning population growth and increasing living standards, both of which are driving growth in domestic demand for consumer goods also.

Butanediol is used in wide array of potential applications downstream. It serves as a fundamental chemical intermediate in production of various products, including Tetrahydrofuran (THF), polyurethane, polybutylene terephthalate (PBT), Gamma-butyrolactone (GBL), N-methylpyrrolidone, polyvinylpyrrolidone, copolyester ether, and more. Additionally, it is used as a solvent, wetting agent, intermediary substance, plasticizer, and brightening agent, among other roles. In recent years. Polybutylene adipate terephthalate (PBAT) has emerged as major consumer of BDO mainly in China. PBAT is synthesized from the polymer of 1,4 BDO and adipic acid and the polymer of dimethyl terephthalate (DMT) with 1,4-butanediol. Currently THF and PBT together account for over 70% of the total Butanediol  demand. 

Increasing investment in PBAT around the world is projected to drive the global BDO market in the forecast period. However, all new major PBAT projects are announced in China with most of the expected to commence operation in in the coming years. In the next 10 years more than 7,000 PBAT capacity is planned to commence operation in China. PBAT is generally marketed as a fully biodegradable alternative to LDPE, offering similar properties including flexibility and resilience, that allows PBAT to be used for uses such as plastic bags and wraps. An average 0.5 tons of BDO is required to produce PBAT.

The new capacity additions in the PBAT industry is further projected to drive the demand of BDO in the long term forecast.

LG Chem has recently signed the ‘MOU for Eco-friendly Biodegradable Materials (PBAT) and with TK Chemical in South Korea. The company is planning to build PBAT plant of 50 kilo tons and start mass production by 2025.

In 2020, BASF and Red Avenue New Materials Group collaborate to produce PBAT in China. Red Avenue New Materials Group will build 60 kilo tons PBAT plant in Shanghai with slated to start operations by 2022.

SK Geo Centric and Kolon Industries have launched eco-friendly biodegradable plastic PBAT with capacity of 3 kilo tons in 2021 at Gumi, South Korea. The company is further planning to expand the capacity to 60 kilo tons by 2024.

In 2020, Chang Chun Plastics Changpin Factory started a 7 kilo tons PBAT plant in Taiwan.

In March 2023, Novamont unveiled plans for the construction of a PBAT manufacturing plant in Porto Marghera, Italy. Anticipated to commence operations in 2024, with an annual production capacity of 20 kilo tons.

In March 2021, BASF Petronas Chemicals, closed its 100 kilo tons BDO plant at Kuantan, Malaysia, due to BDO overcapacity in the region.

In December 2020, BASF Idemitsu Co. JV also closed its 25 kilo tons plant at Chiba, Japan, citing the region’s overcapacity and a declining Butanediol market in the country.