Polyurethane Foam Market

The global polyurethane foam market is expected to grow at a CAGR of 8.36% during the forecast period. Rising demand from the building and construction industry is the key market driver. The market is also driven by the growing home furnishing industry. Furthermore, alternatives of polyols and isocyanates are expected to provide new growth opportunities to the players working in the global polyurethane foam market, during the forecast period. However, regulations on the use of methylene chloride as a blowing agent are expected to restrain the market growth to some extent. Additionally, volatile raw material prices are a major challenge to the growth of the market

The global polyurethane foam market is primarily driven by the surging demand from the building and construction industry.

Polyurethane foam is used extensively in the building and construction industry to insulate roof underlays, exterior walls, floorings, interior wall cavities, attics, crawlspaces, door frames, and window frames, among others. Insulation plays a vital role in energy conservation and increasing the overall building efficiency. Majority of the energy consumed by a building is used for interior space heating and cooling, and a large fraction of that heat is lost from the building envelope through the air leakages present on external walls, window frames, door frames, roof underlays, floorings, crawlspaces, and attics. Insulation can minimize the consumption of energy by reducing air leakage, which can result in lower utility bills and in turn, reduced greenhouse gas emissions. Indoor air quality can also be improved by blocking the infiltration of dust and allergens through small cavities and crevices. Polyurethane foams exhibit high structural strength and resistance to wind forces, which minimizes the need for additional mechanical reinforcement. They offer

Asia-Pacific is witnessing a surge in construction activities since the last decade. Rising residential and commercial constructions, especially in India and China, due to the growing population, improving economy, rising per capita incomes, and increasing government and private-sector investments, are likely to be driving the demand for polyurethane foam. China is adopting various standards such as 3-star rating system known as Green Building Evaluation Label (GBEL) and the US Leadership in Energy and Environmental Design (LEED) certification for green building. The commercial buildings such as hospitals, stadiums, museums, airports, railway stations, shopping malls, offices, hotels, restaurants, and residential houses are required to meet these standards. Green buildings are also becoming an integral part of modern India which can be observed through the various government initiatives, namely, Smart Cities Mission, Pradhan Mantri Awas Yojana (PMAY) and Atal Mission for Rejuvenation and Urban Transformation (AMRUT). The real estate sector in India has also favored the green building initiatives. Some of the green buildings of India are Suzlon One Earth (Pune), CII- Sohrabji Godrej Green Business Centre (Hyderabad), ITC Maurya (New Delhi), Jawaharlal Nehru Bhawan (New Delhi), ITC Green Centre (Gurgaon), and Infinity Benchmark (Kolkata).

In Europe, repair, renovation, and maintenance account for over 70% of the total residential sector. In the US, revenue from the construction industry crossed USD 1 trillion, recently, and is expected to reach USD 1.7 trillion by 2020. According to the US Energy Information Administration (EIA), the residential and commercial sector accounted for approximately 39% of the total energy consumed in the US, in 2017. Stringent regulations to meet building codes and green building certification such as the LEED for commercial buildings, US Green Building Council for Homes (LEED-H), and the US Environmental Protection Agency’s (EPA) Energy Star rating is contributing to the growth of the polyurethane foam market in the North America region. Canada ranks 2nd in the list of top 10 countries for LEED certification outside the US. Furthermore, government initiatives such as the Weatherization Assistance Program (WAP) to promote thermal insulation in low-income households are boosting the market in the region.

The government in the Middle East is developing the infrastructure to boost the tourism industry. Various infrastructural projects taken up by the Middle East government include Smart City project, Dubai Expo 2020, Lusail City project, and Qatar’s FIFA World Cup 2022, which are expected to drive the demand for polyurethane foam during the forecast period. The GCC and Turkey are the major growth-centric markets for polyurethane foams in the region.

Most of the polyols used in the production of polyurethane foams are derived from petroleum feedstocks. However, the increasing concern for environment and the risk of scarcity of petroleum in the future have led to extensive research for developing bio-based polyols from renewable sources, such as biomass residues and vegetable oils. Processes, such as oxypropylation or acid liquefaction of biomass feedstocks, have been widely used to produce renewable polyols for the polyurethane industry. Additionally, different kinds of vegetable oils, such as castor oil, corn oil, palm oil, soybean oil, rapeseed oil, canola oil, and tung oil, have been used in the production of polyurethane foams. These vegetable oils are biodegradable, soluble in most industrial solvents, and blend with conventional petrochemical-based polyols. Companies such as DowDuPont (US), BASF SE (Germany), Bayer AG (Germany), Vertellus Holdings LLC (UK), and Mitsui Chemicals (Japan) are already commercializing bio-based polyols and adopting various strategies to capture larger market shares.

Besides the use of bio-polyols, the use of industrial by-products, namely crude glycerol (CG) can be used to produce rigid polyurethane foams.

Thus, the bio-based polyols and industrial by-products are expected to provide strong growth opportunity to the players working in the polyurethane foam market during the forecast period.

Methylene chloride is used as an auxiliary blowing agent for the manufacturing of polyurethane foam. It helps in the formation of the cellular structure of polyurethane foam and in controlling the density and softness, which is not attainable with conventional waterisocyanate blowing chemistry. The auxiliary blowing agent generally functions by absorbing heat from exothermic reactions, vaporizing and providing additional gas useful in expanding the foam to a lower density. However, it emits volatile organic content (VOC) during recating, which causes environmental pollution. Exposure to methylene chloride is known to cause adverse health effects, such as irritation of the lungs, eyes, and mucous membranes. Long exposure to it can severely affect the central nervous system and can even cause cancer. The US EPA has identified methylene chloride as a hazardous air pollutant and regulated its use in the manufacturing process of polyurethane foam. Thus, regulations on the use of methylene chloride are likely to restrain the growth of the market to some extent during the forecast period.

The polyurethane foam industry is predominantly dependent on petroleum because of raw materials such as polyols and isocyanates that are petroleum derived products. The production of polyurethane foam depends on the petroleum price, as any increase or decrease in oil prices is expected to affect the cost of its production. Increase in the manufacturing expense will thereby results in a decrease in profit margin to manufacturer