Global Green Solvent Market Research Report: Forecast (2023-2028)

Market Definition

These solvents are generated from bio-based raw materials, which are biodegradable & have low toxicity as well as a less adverse effect on the environment. The adoption of green solvents is growing continuously in various industries such as pharmaceuticals, paints & coatings, cosmetics, etc., as these companies are working to reduce their carbon footprint from the environment & improve their sustainability processes.

Market Insights

The Global Green Solvent Market is projected to grow at a CAGR of around 7.0% during the forecast period, i.e., 2023-28.  The environmental regulations to reduce Volatile organic compound (VOC) emissions, by several government organizations like the European Commission, FDA, etc., for the replacement of synthetic solvents, such as acetone, toluene, and xylene, etc., in various industries like paints & coatings, cosmetics, etc., are accelerating the market growth. Moreover, the rising awareness of adverse health effects associated with conventional chemicals is also increasing the preference for these solvents by the end user to offer better products to the consumer which is driving the market revenue.

Additionally, the increasing adoption of eco-friendly bio-based solvents in various applications, such as paints and coatings, pharmaceuticals, and cosmetics, is aimed at reducing carbon emissions in the long term. As a result, manufacturers are switching from synthetic solvents to green solvents, which is expected to increase the demand for these solvents in the forecast years. For instance, in 2022, Lyondell Basell collaborated with Nippon Paint for sustainable development of the coating industry & creates new colors with less environmental impact.

However, the production cost of these solvents is higher as compared to other traditional solvents due to heightened raw material costs & more complex manufacturing processes. This would make customers with low investment potential reluctant to purchase these solvents, hence impeding market growth.

Moreover, the increasing demand for consumer goods in the packaging industry to utilize environmental-friendly solvent-based adhesives & sealants for bonding applications is also creating an opportunity for the market in the coming years.

Market Dynamics

Key Driver: Supporting Government Regulation for Green Solvent

The stringent regulation of the government to reduce carbon emissions from the environment is driving the market growth of green solvents during the historical years. Many countries, like Germany, the US, etc., have been restricting the use of synthetic solvents to reduce carbon emissions from various industries. In the European Union, the usage of various solvents has lowered, such as chloroform, 1,2-DCE, carbon tetrachloride, NMP, DMF, DMAc, benzene, hexane, 1,4-dioxane, 1,2-DME, diethyl ether, etc., due to their adverse effect on human health & the environment. Therefore, various sectors, such as pharmaceutical, chemical, cosmetic, etc., are adopting these solvents to follow government norms for reducing carbon footprints. Hence, the growing demand for environment-friendly solvents from industries to minimize the carbon footprint from the environment is driving the market growth.

Possible Restraint: High Cost Associated with Production

High cost is one of the significant challenges in the market growth of green solvents, as the production of these solvents is more expensive than conventional solvents. Owing to the high cost of raw materials used to form solvents, as they are obtained from crops such as sugarcane, soybean, etc., which are more expensive than petroleum-based solvents. Furthermore, the production process of these solvents requires high energy & heavy equipment, owing to its complex process of manufacturing, which adds to the total cost of the solvent.

Hence, the formation & development of these solvents requires high capital than conventional ones, which raises the overall costs & results in low adoption among users, especially among middle- & low-income manufacturers, which already use traditional solvents that are less expensive & readily available, which hampers the market growth.

Growth Opportunity: Development of New Green Solvents an Opportunity for End-user

The rising formation & development of novel eco-friendly solvents are creating new opportunities in the market as various end-user industries, such as cosmetics, pharmaceutical, etc., are willing to integrate green solvents in their process, which drives the demand for these solvents in the future. As the industry & consumers become more environmentally conscious, they are presumed to require new eco-friendly chemicals with improved performance & sustainability. That would lead to rising demand for these solvents in the forecast years.

Additionally, the formation of new eco-friendly solvents requires considerable R&D and high costs. Therefore, chemical companies invest in research & development processes to develop new solvents & integrate them into various applications to boost their acceptance in many end-use industries & create future market opportunities.

 Key Trend: Rise in Adoption of Green Solvents in Agriculture industry

The agriculture sector has been facing an issue of chemical toxicity in crops due to the excessive use of chemical-based fertilizers. Owing to this practice, the level of toxicity has been increasing on the land & has adverse effects on the health of the consumer. Therefore, to overcome this issue, a trend has been observed, in the agriculture industry, which is the gradually growing use of green solvents in farms, to reduce toxicity & enhance production through eco-friendly measures. This has resulted in expanded demand for these solvents from the agriculture sector recently. Additionally, in response to this trend from the agriculture sector, various chemical companies are formulating their products according to the requirement of the agriculture industry, which would have a positive impact on the market growth in the forecast years.

Market Segmentation

Based on Application:

• Paints & Coatings
• Industrial & Domestic Cleaning
• Printing Inks
• Cosmetic
• Pharmaceutical
• Adhesive Sealant

Of them all, the Paints & Coatings application accounts for the majority of demand for green solvents in the market, owing to the growing number of infrastructure and construction activities in developing and developed nations like China, UAE, and India, which has driven the demand for green solvents in the paint & coating segment in the historical years. The demand for paints & coatings containing bio-based products has been expanding the market, as it offers less health risk compared to synthetic chemicals, and offers the same quality in durability and decorative look for indoor and outdoor paints in construction activity. For instance, according to Foreign Investor Facilitator (FCI), the construction and development sector received around USD 420 million in foreign direct investment equity inflow in 2021. Hence, the increasing construction activity requires paint and coating, and the rising preference of consumers for eco-friendly paints would proliferate the growth of the these solvent in the paints & coatings segment.

Based on Type:

• Bio-alcohol
• Bio-glycol
• Bio-diols
• Ethyl Lactate
• D-lime Stone
• Methyl Soyate

The increasing demand for ethyl lactate in various end-use industries, such as pharmaceuticals, industrial solvent applications, and personal care, owing to its biodegradable &d non-toxic properties, which do not harm the environment or human health, is driving the market for green solvents. Furthermore, lactate esters can easily be used as alternatives to traditional petroleum-based solvents due to their solvency power, which makes them suitable for various industrial applications such as coatings, paints, and adhesives.

In addition, the usage of ethyl lactate as a flavoring agent in the extraction of natural products like essential oils drives the demand for chemicals in the market. These benefits have resulted in the high adoption of ethyl lactate in industries as an alternative to synthetic chemicals. Therefore, manufacturers are using ethyl lactate owing to its environment-friendly nature & better results than conventional ones, which is assisting the sales in the global market.

Regional Projection

Geographically, the market expands across:

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

Among all, Asia-Pacific is predicted to emerge as a significant regional market in the forecast years. This is due to the rising demand for paints & coatings, ink manufacturing, industrial, cosmetics, pharmaceuticals, and other markets in the Asia-Pacific countries such as China, India, etc. Moreover, China's paints & coatings sector is experiencing rapid growth as the country's geographical location provides easy access to product markets, which makes it an important entry point for manufacturers & suppliers.

As a result, the paint and coating manufacturers are using high-quality green solvents for dispersing ingredients in paint formulations. Hence, making Asia-Pacific an attractive regional market with low labor costs, low installation costs for production units, and low market costs during the forecast period,

Recent Developments by the Leading Companies

• 2022: Akzo Nobel acquires Grupo Orbis to expand & strengthen its presence in South America. This transition includes Pintuco paints & coatings, adhesive, and chemical businesses of the company.
• 2022: Solvay announced the production of its new generation green solvent Rhodiasolv IRIS, to offer a more sustainable solution in many industrial & agriculture applications. This solvent is expected to be also produced in 2023 in France.

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