Furfural Market

Updated on : August 06, 2024

Furfural Market

The global furfural market was valued at USD 662 million in 2023 and is projected to reach USD 767 million by 2028, growing at 2.9% cagr from 2023 to 2028. Furfural is an organic intermediate obtained using renewable sources or raw materials like corncobs, sugarcane bagasse, oats, and rice husk etc. It finds use in various applications such as derivatives and solvents as it is a green chemical and is used in many end-use industries like refineries, paint & coatings, agriculture etc.

Attractive Opportunities in the Furfural Market

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Furfural Market Dynamics

Driver: Growing demand for furfuryl alcohol

The surging demand for furfuryl alcohol stands out as a primary driver propelling the furfural market forward. Furfuryl alcohol, a key derivative of furfural, is witnessing an increasing preference across various industries, contributing significantly to the market's growth trajectory. Its versatile applications, particularly in the production of furan resins used in foundry applications, have fueled its demand. As industries prioritize sustainable and eco-friendly solutions, the unique properties of furfuryl alcohol make it a sought-after component. The growing awareness and adoption of furfuryl alcohol as a bio-based and renewable resource in the manufacturing sector underscores its pivotal role in driving the overall expansion of the furfural market.

Restraint: Availability of crude oil-based alternatives in the market

The furfural market faces a notable restraint in the form of the availability of crude oil-based alternatives. The traditional dependence on crude oil-derived substances in various industries poses a challenge to the widespread adoption of furfural and its derivatives. As industries continue to rely on conventional sources, the shift towards embracing furfural-based products encounters resistance due to existing infrastructures and well-established supply chains associated with crude oil derivatives. The inertia in transitioning from crude oil-based alternatives to bio-based solutions limits the potential market share that furfural could otherwise capture. Overcoming this challenge requires not only technological innovations but also a shift in mindset within industries to prioritize the adoption of sustainable and eco-friendly alternatives, such as furfural, in their manufacturing processes.

Opportunity: Increased applications in textile industries

The emerging demand from the textile industry presents a significant market opportunity within the furfural sector. As the textile industry increasingly seeks sustainable and environmentally friendly alternatives, furfural has gained attention for its versatile applications. Furfural's potential use in the textile industry arises from its ability to serve as a bio-based component in the production of various textile-related chemicals and materials. As a result, the rising demand from the textile sector positions Furfural as a promising player in addressing the sustainability goals of the industry, thereby creating a valuable market opportunity.

Challenge: Raw material price fluctuations

Raw material price fluctuations pose a significant market challenge for the furfural industry. The production of furfural relies heavily on agricultural by-products such as corncobs, rice husks, and sugarcane bagasse. The prices of these raw materials are subject to various external factors, including weather conditions, agricultural policies, and global market trends. Fluctuations in raw material prices can impact production costs, subsequently affecting the overall economics of furfural manufacturing. Such uncertainties can pose challenges for industry participants in terms of maintaining stable pricing structures and profit margins. To navigate this challenge, players in the furfural market must implement strategic measures, including supply chain optimization, risk management, and exploring alternative and more stable sources of raw materials, to ensure resilience in the face of price volatility.

Furfural Market Ecosystem

By Raw Material sugarcane bagasse to have highest growth in the forecast period

Sugarcane bagasse is rapidly emerging as the swiftest-growing segment among materials like corn cob, rice husk, and others in the furfural market. Fueled by inherent advantages and versatile applications, sugarcane bagasse, an abundant by-product from the sugar industry, is gaining notable traction. Its high cellulose and hemicellulose content make it an exceptional raw material for furfural production, and the efficient conversion of these components enhances overall yield and productivity during synthesis. Furthermore, the utilization of sugarcane bagasse aligns seamlessly with sustainability initiatives, offering an eco-friendly alternative to conventional sources.

By application, the derivatives segment led the market in 2022.

In 2022, the derivatives segment stood out as the largest application of furfural, commanding the largest share of the market. Furfural serves as a crucial starting material to produce various furan derivatives. Notably, furfuryl alcohol, tetrahydrofuran (THF), maleic anhydride (MA), 2-methyltetrahydrofuran (MTHF), and 1,5-pentanediol are among the derivatives manufactured on a commercial scale. This dominance underscores the pivotal role of furfural in the synthesis of key industrial derivatives, contributing significantly to the overall market landscape.

By end-use industry, the paint & coatings segment was the second largest segment in 2022.

In the furfural market, the paint and coatings industry has emerged as the second-largest end-use sector. This notable trend can be attributed to the versatile applications and unique chemical properties of furfural. Derived from agricultural by-products, furfural has secured a significant niche in the paint and coatings sector due to its efficacy as both a resin and solvent. Its compatibility with diverse paint formulations and coatings, coupled with its ability to enhance adhesion and durability, has spurred its adoption in the industry. As the paint and coatings industry pursues innovative and environmentally conscious solutions, furfural's distinct attributes position it as a crucial player, driving its noteworthy presence within this end-use sector in the furfural market.

Asia Pacific to register highest CAGR during the forecast period.

Asia-Pacific (APAC) stands out as the fastest-growing region in the furfural market due to a combination of factors driving heightened demand and production. The region's rapid industrialization, particularly in emerging economies like China and India, fuels the need for furfural across various industries, including chemicals, pharmaceuticals, and agriculture. Additionally, APAC's commitment to sustainable practices aligns with furfural's eco-friendly attributes, further boosting its adoption. The robust agricultural activities in the region, providing ample biomass for furfural production, contribute to the market's expansion.

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Furfural Market Players

The Furfural market comprises key manufacturers such as Central Romana Corporation (Dominican Republic), Pennakem (US), Silvateam (Italy), Illovo Sugar (South Africa), Hongye Holding Group Corporation Limited (China), KRBL Limited (India), Lenzing AG(Austria), and Merck KGaA (Germany), and others. Expansions, mergers & acquisitions, and deals were some of the major strategies adopted by these key players to enhance their positions in the furfural market. A major focus was given to the expansions and deals.

Read More: Furfural Companies

Furfural Market Report Scope

This research report categorizes the furfural market based on raw material, application, end-use industry, and region.

Furfural Market by Raw Material

• Sugarcane Bagasse
• Corncob
• Rice Husk
• Others

Furfural Market by Application

• Derivatives
• Solvents
• Others

Furfural Market by End-Use Industry

• Agriculture
• Paint & Coatings
• Pharmaceuticals
• Food & Beverages
• Refineries
• Others

Furfural Market by Region

• North America
• Europe
• Asia Pacific
• South America
• Middle East & Africa

Recent Developments

• Fortum announced a new biorefinery project in Assam, India. It is expected to start production in 2024. The biore­finery is a joint venture of the Indian oil refinery company Numaligarh Refinery Limited (NRL), Chempolis and Fortum.
• In June 2023, Origin Materials announced startup of origin 1, world’s first commercial CMF (chloromethyl furfural) plant.
• In May 2021, The Kilombero Sugar Company, in which Illovo Sugar Africa holds 75% of the share share announced a major expansion project. This new development will increase the company’s sugar production from 127 000 tons of sugar per annum, to 271 000 tons.
• In May 2019 Pennakem, LLC, obtained the approval of use of its renewable solvent Viridisol M as a raw material authorized for natural detergents and natural detergents made with organic raw materials.
• In May 2017, The U.S. Department of Agriculture granted its "biobased" certificate to Lenzing Group's acetic acid, furfural. This highlighted a significant strength in the company's commitment to sustainability.

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