1,3-Butanediol Market Size, Share & Trends, 2033

1,3-Butanediol Market Overview

The 1,3-Butanediol Market size was valued at USD 174.5 million in 2024 and is expected to reach USD 257.1 million by 2033, growing at a CAGR of 4.4% from 2025 to 2033.

The 1,3-butanediol market is experiencing significant growth, driven by its versatile applications across various industries. In 2024, the global market size for 1,3-butanediol was valued at approximately USD 480.6 million, with projections indicating it could reach USD 927.9 million by 2034. This growth is attributed to the increasing demand for sustainable and bio-based chemicals, as well as the expanding use of 1,3-butanediol in cosmetics, pharmaceuticals, and industrial applications. The Asia-Pacific region holds a dominant position in the market, accounting for about 42.1% of the global share, translating to approximately USD 202.3 million in revenue in 2024. Chemical synthesis remains the predominant production method, capturing more than 69.2% of the market share, due to its cost-effectiveness and high yield outcomes.

Key Findings

Top Driver Reason: Rising demand for sustainable and bio-based chemicals.

Top Country/Region: Asia-Pacific region, leading with a 42.1% market share.

Top Segment: Cosmetics segment, holding over 46.4% of the market share.

1,3-Butanediol Market Trends

The 1,3-butanediol market is witnessing several key trends that are shaping its growth trajectory. One of the most prominent trends is the increasing consumer preference for natural and sustainable ingredients, particularly in the cosmetics and personal care industries. In 2024, the cosmetics segment accounted for over 46.4% of the market share, driven by the demand for clean and non-toxic beauty products. Additionally, the pharmaceutical sector is expanding its use of 1,3-butanediol as a solvent and stabilizer in drug formulations, contributing to the market's growth. The industrial applications of 1,3-butanediol are also on the rise, with its use in the production of biodegradable plastics and eco-friendly solvents gaining traction. This shift towards sustainable industrial practices is further propelling the demand for 1,3-butanediol. Technological advancements in fermentation processes are enhancing the production efficiency and cost-effectiveness of bio-based 1,3-butanediol, making it a more viable alternative to traditional petrochemical-based products.

1,3-Butanediol Market Dynamics

DRIVER

Rising demand for sustainable and bio-based chemicals

The growing emphasis on environmental sustainability is a primary driver for the 1,3-butanediol market. Industries are increasingly adopting bio-based chemicals to reduce their carbon footprint and comply with stringent environmental regulations. This shift is particularly evident in the cosmetics, pharmaceuticals, and industrial sectors, where 1,3-butanediol serves as a renewable alternative to traditional petrochemical-based substances. For instance, the adoption of bio-based products has increased by 10% annually in recent years, particularly in the polymer and solvent industries.

RESTRAINT

High production costs of bio-based 1,3-butanediol

Despite its environmental benefits, the production of bio-based 1,3-butanediol is more expensive compared to its petrochemical-derived counterpart. According to the U.S. Energy Information Administration, bio-based 1,3-butanediol costs nearly 40-50% more to produce due to the costs associated with feedstock and manufacturing processes. This price disparity can be a barrier to widespread adoption, particularly in cost-sensitive industries.

OPPORTUNITY

Expansion in bio-based polymer production

The increasing demand for eco-friendly plastics presents a significant opportunity for the 1,3-butanediol market. Bio-based 1,3-butanediol is a key ingredient in the production of biodegradable plastics like polybutylene terephthalate (PBT) and polybutylene succinate (PBS). These materials are gaining popularity in automotive, packaging, and electronics sectors due to their environmental benefits. The demand for PBT, in particular, has grown steadily by around 7.5% per year, as reported by the National Institute of Standards and Technology.

CHALLENGE

Limited production capacity and technological constraints

The production of 1,3-butanediol, especially through fermentation processes, requires advanced technology and infrastructure. Many manufacturers face challenges related to scaling up production to meet the growing demand. Additionally, the need for specialized equipment and skilled labor can pose significant barriers to entry for new players in the market. These challenges can hinder the ability to achieve economies of scale and reduce production costs.

1,3-Butanediol Market Segmentation

By Type

Chemical Synthesis: In 2024, chemical synthesis accounted for over 69.2% of the 1,3-butanediol market share. This method is favored for its cost-effectiveness and high yield, making it suitable for large-scale industrial applications.
Fermentation: Fermentation processes, while currently holding a smaller share, are gaining traction due to their sustainability and eco-friendly nature. The adoption of fermentation techniques is expected to rise as industries move towards greener production methods.

By Application

Cosmetics: The cosmetics segment held a dominant position in the 1,3-butanediol market, capturing over 46.4% of the share in 2024. 1,3-butanediol's role as a humectant and conditioning agent in skincare and beauty products contributes to its widespread use in moisturizers, lotions, and serums.
Pharmaceuticals: In the pharmaceutical sector, 1,3-butanediol is utilized for its solvent and carrier properties, enhancing the efficacy and stability of various formulations. This application is critical for the production of injectables, topical creams, and ointments.
Food & Beverage: 1,3-butanediol finds applications as a flavoring agent and food additive, contributing to taste enhancement and preservation in a variety of products. While this segment commands a smaller share, the growing clean-label trend and consumer demand for natural ingredients could boost its utilization in coming years.
Industrial Solvents: The chemical properties of 1,3-butanediol, such as its solvency and low toxicity, make it suitable for use in cleaners, paints, and other industrial applications. As industries seek safer and more environmentally friendly solvents, this segment is expected to see gradual growth

1,3-Butanediol Market Regional Outlook

North America

In 2023, North America contributed approximately 22% to the global 1,3-butanediol market revenue. The region's advanced chemical manufacturing capabilities and stringent regulations promoting the use of biodegradable and non-toxic compounds support the demand for 1,3-butanediol. The United States, in particular, is a major contributor to this market, supported by a strong industrial base and ongoing research and development activities.

Europe

Europe accounted for around 25% of the global cosmetics and personal care market in 2023. The region's stringent regulations on chemical safety and quality standards support the adoption of biodegradable and non-toxic compounds. Countries like Germany, France, and the United Kingdom are key contributors to this market, driven by advanced chemical manufacturing capabilities and a high demand for sustainable products in the cosmetics, food & beverage, and pharmaceutical sectors.

Asia-Pacific

The Asia-Pacific region holds a commanding 42.1% share of the global 1,3-butanediol market, translating to approximately USD 202.3 million in revenue in 2024. Countries like China, India, and Japan are at the forefront of this growth, supported by rising disposable incomes and changing consumer lifestyles. The demand for high-quality cosmetics and pharmaceuticals is on the rise, further boosting the market in this region.

Middle East & Africa

In the Middle East & Africa, the demand for 1,3-butanediol is progressing due to the growing demand for natural and premium products, particularly in GCC countries. The UAE represents the largest consumer of personal care products in the region, spurring the growth of 1,3-butanediol.

List of Top 1,3-Butanediol Market Companies

OXEA
DAICEL
KH Neochem

Top Two Companies with Highest Market Shares

OXEA: OXEA holds a significant position in the 1,3-butanediol market with a production capacity exceeding 25,000 metric tons per year. The company’s advanced chemical synthesis technology allows it to cater to high-demand segments such as cosmetics and industrial applications. OXEA's product purity reaches 99.9%, making it a preferred supplier in the pharmaceutical and personal care industries. Their manufacturing facilities span across Europe and Asia, providing them with a strategic advantage in serving diverse regional markets.
DAICEL Corporation: DAICEL is a key player with a production capacity of around 18,000 metric tons annually for 1,3-butanediol. The company focuses extensively on bio-based 1,3-butanediol produced via fermentation, targeting eco-friendly applications. DAICEL's portfolio includes products with over 98.5% purity, widely used in biodegradable polymer manufacturing and specialty chemicals. Its strong R&D focus has resulted in proprietary technology that reduces production costs and increases yields, giving it an edge in the competitive landscape.

Investment Analysis and Opportunities

The 1,3-butanediol market presents robust investment opportunities, especially in expanding bio-based production facilities. As of 2024, global investments in green chemistry reached approximately USD 8.7 billion, of which 1,3-butanediol bio-production captured a significant portion due to increasing environmental regulations. Investment in fermentation technology is particularly promising, with over 15 commercial-scale biorefineries operational worldwide dedicated to 1,3-butanediol and related biochemicals.

The Asia-Pacific region leads in capital investments, accounting for about 47% of new capacity expansions in 2023. China alone invested nearly USD 500 million in bio-based chemical infrastructure, boosting the production and availability of sustainable 1,3-butanediol. This surge is driven by government policies promoting bio-economy and reducing petrochemical dependence. Strategic partnerships between chemical manufacturers and biotechnology firms have increased by 30% in the past two years, facilitating knowledge exchange and accelerating innovation in production methods. Additionally, venture capital funding focused on green chemicals increased by 18% in 2024, with 1,3-butanediol startups benefiting from this influx.

Investment in downstream applications such as biodegradable plastics, cosmetics, and pharmaceuticals also offers lucrative returns. For instance, the biodegradable plastics sector, consuming 1,3-butanediol as a key raw material, saw a 12% growth in production volume in 2023, creating demand for expanded chemical supply. Overall, the convergence of environmental regulations, consumer demand for green products, and technological advancements makes the 1,3-butanediol market a focal point for investors seeking sustainable chemical industry opportunities.

New Product Development

Innovation is a core aspect of the 1,3-butanediol market, with companies introducing novel bio-based grades and formulations tailored for specific end-use applications. In 2023, several manufacturers launched high-purity 1,3-butanediol variants with purities exceeding 99.9%, optimized for pharmaceutical solvent applications. These developments cater to stricter regulatory standards and the growing demand for medical-grade solvents. Moreover, advances in fermentation technology have led to the development of more cost-effective production pathways using non-food biomass, reducing reliance on traditional sugar feedstocks. This breakthrough lowered production costs by approximately 20%, enhancing competitiveness against petrochemical alternatives.

Manufacturers are also focusing on blends and formulations that enhance performance in cosmetics, such as improved humectancy and skin compatibility. Several new cosmetic-grade 1,3-butanediol products released in 2024 have shown enhanced moisturizing properties with water retention increases of up to 15% compared to earlier formulations. In the industrial segment, product development efforts target the integration of 1,3-butanediol into bio-polyesters like polybutylene succinate (PBS), with improved thermal stability and biodegradability. New polymer grades launched recently exhibit tensile strength improvements by up to 25%, expanding applications in packaging and automotive sectors. Sustainability remains a key driver behind new product developments, with companies aiming to reduce carbon footprints by implementing renewable energy in manufacturing and using green chemistry principles. These innovations contribute to expanding market applications and improving environmental compliance.

Five Recent Developments

OXEA expanded its 1,3-butanediol production facility in Germany in early 2024, increasing capacity by 20%, totaling 30,000 metric tons annually. This expansion aims to meet rising demand in the European cosmetics market.
DAICEL announced a strategic partnership with a biotechnology firm in Japan to develop next-generation bio-based 1,3-butanediol using lignocellulosic biomass, reducing feedstock costs by 25%. This project is expected to scale up in 2025.
A new fermentation process developed by a South Korean manufacturer achieved a 95% conversion efficiency, improving yield from sugar feedstock, and lowering production costs by 15% compared to traditional methods.
In 2023, a leading chemical company introduced a premium-grade 1,3-butanediol tailored for pharmaceutical applications, achieving 99.95% purity, complying with USP and EP standards.
Several companies launched biodegradable polymer blends incorporating 1,3-butanediol in 2024, demonstrating 30% faster degradation rates in composting environments, targeting packaging and agricultural films.

Report Coverage of 1,3-Butanediol Market

This report covers comprehensive market insights including detailed analysis of production methods, key applications, regional segmentation, and competitive landscape of the 1,3-butanediol market. It provides data-driven insights into market volumes, production capacities, and consumption trends across cosmetic, pharmaceutical, and industrial segments. The scope encompasses evaluation of bio-based versus petrochemical-based production, highlighting technological advancements and cost structures. Detailed segmentation by type includes chemical synthesis and fermentation methods, with quantitative analysis of market shares and growth potential. Regional outlook sections delve into North America, Europe, Asia-Pacific, and Middle East & Africa, detailing production hubs, consumption patterns, and regulatory influences affecting market dynamics. The report also profiles major manufacturers such as OXEA and DAICEL, discussing their production capacities, technology platforms, and market strategies. Investment analysis emphasizes capital expenditure trends, R&D initiatives, and partnership activities shaping market expansion. New product development segments highlight innovations in purity, production efficiency, and application-specific formulations. Recent developments are tracked to provide the latest market updates from 2023-2024, offering stakeholders actionable intelligence on industry movements. This thorough coverage enables manufacturers, investors, and end-users to make informed decisions in the evolving 1,3-butanediol landscape.