1,4-Butanediol Market - Global Industry Size, Share, Trends, Opportunity & Forecast, Segmented By Derivative (Tetrahydrofuran (THF), Polybutylene Terephthalate (PBT), Gamma-Butyrolactone (GBL), Polyurethane (PU), Others), By End User (Automotive, Healthcare and Pharmaceuticals, Textile, Electrical and Electronics, Others), By Region & Competition, 2020-2030F

Market Overview

Global 1,4-Butanediol market was valued at USD 7.32 Billion in 2024 and is expected to reach USD 9.46 Billion by 2030 with a CAGR of 4.32%. The growth of the market is primarily attributed to the wide range of applications of tetrahydrofuran (THF), polybutylene terephthalate (PBT), and polyurethane (PU) in various industrial processes. Additionally, the increasing demand for spandex in textiles has contributed to the market expansion. Tetrahydrofuran, a colorless liquid derived from butane, is considered one of the most stable isomers of butanediol. To produce 1,4 butanediol (BDO), the Reppe process is widely practiced by major industry players like BASF and DuPont. This method involves the reaction of acetylene with formaldehyde. Notably, these 1,4 BDO product suppliers have integrated backward to start producing their own raw materials.

This strategic move has significantly reduced logistics costs and procurement hassles for these companies, ensuring a consistent supply of high-quality materials throughout the production process. Furthermore, the market is expected to witness significant growth due to the increasing global focus on green chemistry. Major market participants such as BioAmber, Genomatica, and Myriant are actively developing alternative, bio-based processing technologies, which are anticipated to drive market growth in the forecast period. Investments in sustainable technologies are also expected to boost existing processes, improving overall efficiency and sustainability. 

A notable process technology gaining popularity is the Davy process, also known as the Maleic anhydride-based process. This method has gained traction in recent years due to its reduced complexity, equipment requirements, and capital costs. In the Davy process, maleic anhydride is converted into an ester, which then undergoes fixed-bed hydrogenolysis to produce a mixture of 1,4 BDO, THF, and GBL. BASF, for example, has integrated the Davy process with Huntsman Mars V/VI in Kuantan, Malaysia, to reduce production costs and penetrate the highly profitable Asia Pacific market. In addition to these established technologies, recent advancements such as the hydrogenation of succinic acid, fermentation of sugars, and esterification have also transformed the 1,4 BDO industry, adding further diversity and potential for growth.

Key Market Drivers

Growing Demand of 1,4-Butanediol from Automotive Industry

1,4-Butanediol (BDO) is a vital raw material extensively used in the production of high-performance plastics, including polybutylene terephthalate (PBT) and polyurethanes (PU). These plastics exhibit exceptional mechanical properties, heat and chemical resistance, and fuel efficiency due to their lightweight composition. As a result, they have become indispensable in the automotive industry. 1,4-Butanediol (1,4-BDO) serves as a critical raw material in the production of polybutylene terephthalate (PBT), a high-performance engineering thermoplastic known for its superior strength, thermal stability, and durability. These properties make PBT widely applicable in the automotive, electrical, and appliance sectors. Additionally, its compatibility with various thermoplastics allows compounders to customize polymer alloys to meet specific end-user requirements. 1,4-BDO is also essential in the formulation of thermoplastic copolyester elastomers. In these materials, it contributes to polymer crystallinity, which enhances elasticity and resilience key performance attributes in terephthalate-based elastomers.

The surge in demand for high-performance plastics in the automotive sector can be attributed to stringent government regulations aimed at reducing vehicle emissions and improving fuel efficiency. In response to these regulations, the use of BDO-derived products in the manufacturing of various automotive components, such as car bumpers, braking systems, and electrical insulators, has witnessed a significant increase.

The 1,4-Butanediol market appears promising, with the growing demand from the automotive industry acting as a key driver of its growth. As the automotive industry continues to evolve towards more sustainable and efficient solutions, the demand for BDO and its derivatives is expected to rise further.

It is important for players in the BDO market to remain mindful of potential challenges. Price volatility of raw materials and environmental concerns surrounding BDO production are among the key challenges that need to be addressed for sustainable growth in the market. The increasing demand for 1,4-Butanediol from the automotive industry is not only driving the growth of the global BDO market but also presenting numerous opportunities for innovation and expansion. With ongoing advancements in the automotive sector, this trend is expected to persist, shaping the future of the BDO market.

Growing Demand of 1,4-Butanediol from Healthcare Industry

1,4-Butanediol (BDO) plays a crucial role in the healthcare industry as a vital raw material for producing polyurethanes (PU). These polyurethanes are then utilized in various medical devices such as catheters, surgical drains, and pacemaker leads. Additionally, BDO is also utilized in the manufacturing of polybutylene terephthalate (PBT), a specific type of plastic that finds applications in the production of precision instruments.

The demand for these materials in the healthcare industry is steadily growing, driven by factors such as an aging population, advancements in healthcare infrastructure, and rapid technological innovations in medical devices. According to the World Population Prospects 2024, the global population is projected to continue growing over the next five to six decades, reaching a peak of approximately 10.3 billion by the mid-2080s up from 8.2 billion in 2024 before gradually declining to around 10.2 billion by the year 2100. As a result, the demand for BDO, as a critical component in the manufacturing of these materials, is experiencing an upward trajectory.

It is important to acknowledge and address potential challenges associated with the BDO market. One such challenge is the volatility of raw material prices, which can impact the overall supply chain and market dynamics. Additionally, there is a need to focus on environmental concerns related to BDO production in order to ensure sustainable growth in the market. The increasing demand for 1,4-Butanediol from the healthcare industry serves as a significant driver for the global BDO market. This trend not only presents numerous opportunities for growth and innovation in the BDO market but also paves the way for future developments and advancements in healthcare technologies.

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Key Market Challenges

Volatility in Price of Raw Materials

1,4-Butanediol (BDO) is an important chemical compound that is synthesized industrially from butadiene and acetylene, along with other feedstocks. These feedstocks are subject to price fluctuations influenced by various factors, including changes in crude oil prices, production capacity, market demand, and geopolitical tensions.

The volatility in the prices of these raw materials directly impacts the cost of producing BDO. As a result, it affects the profitability of manufacturers in the BDO industry. The unpredictability in costs adds an additional layer of complexity for manufacturers, making it challenging for them to plan their production and pricing strategies effectively.

Moreover, any increase in the price of raw materials often leads to a subsequent increase in the price of BDO. This price increase can have consequences for end-use industries that rely on BDO as a key ingredient in their products. It may discourage them from incorporating BDO into their formulations, which, in turn, can impact the overall demand for BDO.

Considering the intricate relationship between raw material prices, production costs, and market dynamics, it becomes crucial for BDO manufacturers to closely monitor and analyze these factors to navigate the ever-changing landscape of the BDO industry successfully.

Key Market Trends

Growing Demand of 1,4-Butanediol in Polymers

1,4-Butanediol, also known as BDO, plays a critical role as an intermediate in the production of polymers. It serves as a fundamental raw material for synthesizing tetrahydrofuran (THF), a widely used solvent in the manufacturing of spandex fibers, and polybutylene terephthalate (PBT), a high-performance plastic with exceptional properties. These materials have found extensive application across various industries, including automotive, electrical, and textiles, due to their remarkable durability, efficiency, and performance.

The expanding market for 1,4-Butanediol is not only driving the demand for BDO but also fostering innovation and research in its applications. This, in turn, contributes to the development of new and improved manufacturing processes and end-products. As industries continue to seek advanced materials that offer both sustainability and superior performance, the demand for 1,4-Butanediol and its derivatives is expected to witness continued growth and expansion.

The 1,4-Butanediol market appears promising, with the increasing demand for BDO in polymer production being a key driving force behind its growth. The trend toward utilizing high-performance materials in various industries is expected to persist, further fueling the demand for 1,4-Butanediol and its derivatives.

It is important to address potential challenges such as price volatility of raw materials and environmental concerns associated with BDO production for sustainable growth in the market. By implementing efficient and eco-friendly practices, the industry can ensure long-term viability and contribute to a more sustainable future. The growing demand for 1,4-Butanediol in polymer production is a significant trend in the global BDO market. As advancements continue to unfold across diverse industries, this trend is expected to persist, offering numerous opportunities for growth, innovation, and collaboration within the BDO market.

Segmental Insights

Derivative Insights

Based on the category of derivative, the tetrahydrofuran (THF) segment emerged as the fastest growing in the global market for 1,4-Butanediol in 2024. Tetrahydrofuran is one of the most critical downstream derivatives of 1,4-BDO, accounting for a significant portion of its global consumption. THF serves as a key intermediate in the production of polytetramethylene ether glycol (PTMEG), which is subsequently used to manufacture spandex (elastane) fibers, a material in high demand across the textile and performance apparel industries.

The global growth in the athleisure, sportswear, and personal care sectors is fueling demand for spandex-based fabrics. THF, as the precursor to PTMEG, plays an indispensable role in this supply chain. Emerging markets in Asia-Pacific, particularly China, India, and Southeast Asia, are witnessing exponential textile manufacturing growth, directly impacting THF consumption. THF is a widely used solvent in the pharmaceutical and polymer industries. Its application in producing synthetic drugs and specialty polymers has surged, especially in the context of increased global investment in life sciences, biotechnology, and drug delivery systems. Compared to other solvents, THF offers higher reaction efficiency, low toxicity, and recyclability, making it a preferred choice in advanced chemical synthesis and green chemistry processes. This aligns with global trends toward sustainable and energy-efficient production practices.

End User Insights

Based on category of End User, Healthcare and Pharmaceuticals segment has emerged as a dominant end-user category, driven by the compound's strategic utility in pharmaceutical synthesis, medical-grade materials, and life sciences innovation. 1,4-Butanediol serves as a key intermediate in the synthesis of several pharmaceutical compounds, most notably: γ-Butyrolactone (GBL): A derivative of 1,4-BDO used in drug synthesis and as a solvent in pharmaceutical formulations. A critical solvent used in active pharmaceutical ingredient (API) development and drug delivery applications. 1,4-BDO is also involved in the formulation of certain anesthetics, sedatives, and specialty drugs, particularly in regulated markets like North America and the EU. Its chemical stability, high purity levels, and compatibility with good manufacturing practices (GMP) make it highly suitable for use in regulated pharma environments.

The healthcare industry has undergone a dramatic transformation post-pandemic, with governments and private sectors significantly increasing investments in: Generic drug production, Biopharmaceutical research, Vaccine and drug delivery systems, Medical consumables and diagnostics. This surge in demand has accelerated the use of 1,4-BDO in solvent systems, resins, and medical polymers, particularly in developing regions such as Asia-Pacific and Latin America, where pharmaceutical manufacturing capacity is rapidly expanding.

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Regional Insights

Asia Pacific emerged as the largest market in the Global 1,4-Butanediol Market in 2024, holding the largest market share in terms of value. Asia-Pacific functions as the global center for large-scale chemical manufacturing, with countries such as China, India, Japan, and South Korea leading production in textiles, automotive parts, electronics, consumer goods, and pharmaceuticals all of which use 1,4-BDO or its derivatives. China, the world’s largest producer and consumer of 1,4-BDO, houses integrated manufacturing complexes that support both upstream production and downstream conversion into derivatives like THF, GBL, and PBT. India is rapidly scaling up its chemical and pharmaceutical manufacturing capacity, aided by government incentives under the “Make in India” and Production Linked Incentive (PLI) schemes. These facilities benefit from economies of scale, lower raw material costs, and skilled labor, making the region a cost-effective production base.

Asia-Pacific is the largest consumer of 1,4-BDO derivatives, especially: Tetrahydrofuran (THF) – Driven by massive spandex and polyurethane production for the regional and global textile markets. Polybutylene Terephthalate (PBT) – Widely used in automotive and electronics applications. Gamma-Butyrolactone (GBL) – Applied in agrochemicals, electronics, and pharmaceuticals. With booming industries such as automotive, electronics, and fast fashion, demand for these downstream products is consistently high, directly reinforcing the need for 1,4-BDO in the region. The region is witnessing continuous capacity expansion from both regional players and multinational chemical companies. Examples include: BASF-YPC and Dairen Chemical Corporation investing in integrated BDO production lines in China and Southeast Asia. Mitsubishi Chemical expanding its presence in Japan and Thailand to meet growing derivative demand. Such investments are aimed at serving both export markets and fast-growing local industries, creating a self-reliant and vertically integrated chemical value chain.

According to the International Trade Administration (U.S. Department of Commerce), China holds the position as the world’s largest automotive market, both in terms of vehicle sales and production volume. The agency projected that China’s automobile production would reach 30 million units by 2020, with expectations of a further increase to 35 million units by 2025, reflecting the country’s sustained growth and dominance in the global automotive manufacturing landscape.

Recent Developments

• In April 2025, INEOS Solvents SA filed a formal complaint that led the European Commission to launch an anti-dumping investigation into imports of 1,4-butanediol (BDO) originating from China, Saudi Arabia, and the United States. The decision to initiate the investigation was officially published in the Official Journal of the European Union (OJ C\_202503135).
• In September 2023, BASF has secured long-term access to QIRA®, a bio-based 1,4-butanediol (BDO) supplied by Qore® LLC, a joint venture between Cargill and HELM AG. The two companies have entered into a formal agreement under which Qore will produce the bio-based BDO at Cargill’s biotechnology campus and corn refining facility in Eddyville, Iowa. Through this partnership, BASF aims to expand its portfolio of BDO derivatives by offering bio-based alternatives such as polytetramethylene ether glycol (PolyTHF) and tetrahydrofuran (THF), supporting its strategy for more sustainable and renewable chemical solutions.

Key Market Players

• Ashland Inc.
• LyondellBasell Industries Holdings BV
• Mitsubishi Chemical Corporation
• NAN YA PLASTICS CORPORATION
• SINOPEC YIZHENG CHEMICAL FIBRE LIMITED LIABILITY COMPANY
• Shanxi Sanwei Group Co. Ltd

In this report, the Global 1,4-Butanediol Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• 1,4-Butanediol Market, By Derivative:

o   Tetrahydrofuran (THF)

o   Polybutylene Terephthalate (PBT)

o   Gamma-Butyrolactone (GBL)

o   Polyurethane (PU)

o   Others

• 1,4-Butanediol Market, By End User:

o   Automotive

o   Healthcare and Pharmaceuticals

o   Textile

o   Electrical and Electronics

o   Others

• 1,4-Butanediol Market, By Region:

o   North America

§  United States

§  Canada

§  Mexico

o   Europe

§  France

§  United Kingdom

§  Italy

§  Germany

§  Spain

o   Asia-Pacific

§  China

§  India

§  Japan

§  Australia

§  South Korea

o   South America

§  Brazil

§  Argentina

§  Colombia

o   Middle East & Africa

§  South Africa

§  Saudi Arabia

§  UAE

Competitive Landscape

Company Profiles: Detailed analysis of the major companies present in the Global 1,4-Butanediol Market.

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