Regenerated Cellulose Market - Global Industry Size, Share, Trends, Opportunity, and Forecast, Segmented By Type (Fiber, and Film), By Source (Wood-Pulp, Non-Wood-Pulp, and Recycled Pulp/De-inked Pulp), By End User Industry (Textile, Automotive, Packaging, Agriculture, Others), By Company (2021) and By Region 2021-2031F

Forecast Period	2027-2031
Market Size (2025)	USD 20.31 Billion
CAGR (2026-2031)	6.21%
Fastest Growing Segment	Packaging
Largest Market	Asia Pacific
Market Size (2031)	USD 29.15 Billion

Market Overview

The Global Regenerated Cellulose Market will grow from USD 20.31 Billion in 2025 to USD 29.15 Billion by 2031 at a 6.21% CAGR. Regenerated cellulose is a category of bio-based fibers, including viscose, lyocell, and modal, produced by dissolving and chemically processing natural cellulose sourced primarily from wood pulp. The market is fundamentally driven by the global textile industry's imperative to adopt biodegradable alternatives that offer the comfort of natural fibers while mitigating the environmental footprint associated with fossil-based synthetics. This structural shift toward renewable materials is substantiated by recent industry volume; according to the Textile Exchange, the global production of manmade cellulosic fibers increased to 8.4 million tonnes in 2024. This growth trajectory highlights the sector's expanding role in bridging the gap between cotton shortages and synthetic fiber dominance.

However, the market faces a significant impediment regarding the environmental sustainability of its supply chain. A major challenge impeding broader expansion is the complexity of ensuring zero-deforestation feedstocks combined with the capital-intensive nature of closed-loop chemical processing. The rigorous requirement to modernize aging facilities for solvent recovery and verify wood pulp origins creates high operational costs, potentially stalling growth in price-sensitive regions where conventional synthetics remain the economically incumbent choice.

Key Market Drivers

The strategic shift of fashion brands towards circular economy materials is profoundly reshaping the Global Regenerated Cellulose Market, creating a mandate for traceability and responsible sourcing. Major apparel conglomerates are moving beyond voluntary sustainability goals to enforce strict procurement standards, effectively compelling fiber manufacturers to eliminate feedstock from endangered forests and adopt closed-loop technologies. This corporate pivot creates a guaranteed market for high-compliance fibers, as brands aggressively integrate these materials to meet decarbonization targets. For instance, according to Inditex, March 2024, in the 'Annual Report 2023', the retailer successfully sourced 85% of its man-made cellulosic fibers from manufacturers classified with 'green shirts' in the CanopyStyle initiative, underscoring the commercial imperative for certified sustainable production.

Simultaneously, escalating consumer demand for sustainable and biodegradable fibers is driving the industry to transparency and innovation. Educated consumers are increasingly rejecting fossil-based synthetics in favor of bio-based alternatives, pressuring producers to prove their environmental credentials through rigorous third-party audits. This demand has accelerated the adoption of best practices across the supply chain, significantly raising the bar for market entry. According to Canopy, December 2024, in the 'Hot Button Report 2024', 71% of rated man-made cellulosic fiber producers have now achieved a 'green shirt' designation, signaling a widespread industry alignment with low-risk sourcing standards. Despite this progress, the transition to fully circular feedstocks remains in its nascent stages; according to Textile Exchange, September 2024, in the 'Materials Market Report 2024', the market share of man-made cellulosic fibers derived from recycled feedstocks was just 0.7% in 2023, highlighting the immense growth potential for next-generation technologies.

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Key Market Challenges

The primary impediment restricting the expansion of the Global Regenerated Cellulose Market is the substantial financial burden imposed by rigorous environmental sustainability mandates. Producers are required to invest heavily in modernizing aging infrastructure to achieve closed-loop solvent recovery and to implement complex verification systems that ensure wood pulp is free from deforestation risks. These capital-intensive obligations directly inflate operational expenditures, forcing manufacturers to increase the final price of fibers such as viscose and lyocell. Consequently, these bio-based alternatives become significantly more expensive than conventional fossil-based synthetics, which do not carry comparable environmental compliance costs.

This price disparity creates a severe competitive disadvantage, particularly in cost-conscious regions where affordability dictates procurement decisions. The inability to compete on price with synthetic incumbents stalls market penetration and limits widespread adoption. This economic strain is evident in recent industry assessments. According to the International Textile Manufacturers Federation (ITMF), in July 2024, 27% of global textile companies surveyed cited high raw material costs as a major concern impacting their business performance. This data underscores how the elevated costs associated with securing compliant, sustainable feedstocks create a barrier to growth, effectively preventing regenerated cellulose from displacing cheaper synthetic rivals in the mass market.

Key Market Trends

The commercialization of textile-to-textile recycling technologies is rapidly transitioning from pilot-scale validation to industrial-level production, driven by the urgent need to secure circular feedstocks. Manufacturers are now making substantial infrastructure investments to process blended textile waste into high-quality pulp, effectively operationalizing circularity beyond niche collections. For instance, according to Textile World, May 2025, in the article 'Circ To Open World's First Of Its Kind Commercial Plant For Polycotton Recycling', the innovator Circ announced plans for a new facility with the capacity to process 70,000 metric tons of polycotton material per year. This trend represents a critical structural evolution in the market, as it establishes a scalable supply chain for next-generation fibers that can reduce the industry's long-term dependence on virgin wood pulp and mitigate raw material volatility.

Simultaneously, the integration of lyocell fibers into nonwoven hygiene products is expanding as the sector seeks high-performance, biodegradable alternatives to fossil-based plastics. This shift is characterized by targeted capital expenditures aimed at upgrading production lines to manufacture specialized hydrophobic and absorbent fibers suitable for single-use applications like wipes and sanitary products. According to Textile Excellence, November 2025, in the article 'Lenzing Commits EUR 15 Million To Expand Nonwoven Capacity For Global Hygiene Market', the Lenzing Group approved an investment of EUR 15 million to enhance its manufacturing capabilities for VEOCEL branded lyocell fibers. This strategic allocation of capital underscores the deepening market penetration of regenerated cellulose within the hygiene segment, moving the material beyond its traditional stronghold in apparel to meet the demand for plastic-free personal care solutions.

Segmental Insights

The Packaging segment is currently identified as the fastest-growing category within the Global Regenerated Cellulose Market, driven by an accelerating global shift toward sustainable materials. This expansion is primarily fueled by stringent environmental mandates aiming to reduce dependency on single-use synthetic plastics. Manufacturers are increasingly adopting regenerated cellulose films because they offer biodegradability alongside effective barrier properties against oxygen and grease. Consequently, the food and beverage industries are rapidly integrating these compostable solutions to comply with regulatory standards and satisfy consumer demand for eco-friendly product alternatives.

Regional Insights

Asia Pacific commands the leading position in the Global Regenerated Cellulose Market, primarily driven by its established status as the global hub for textile and apparel manufacturing. Major economies such as China and India fuel substantial demand for fibers like viscose and lyocell to sustain their vast garment export industries. This market leadership is supported by robust local infrastructure that ensures cost-effective access to key raw materials, including dissolving wood pulp. Furthermore, regional industrial policies promoting sustainable manufacturing align with the growing preference for biodegradable textiles, solidifying Asia Pacific’s commercial dominance.

Recent Developments

• In October 2025, the Lenzing Group teamed up with the textile technology company OceanSafe to launch a next-generation yarn that blends Tencel branded lyocell fibers with a biodegradable co-polyester. This new product innovation aims to provide a scalable, circular solution for the high-performance sportswear and athleisure markets, offering a sustainable alternative to conventional synthetic blends. The collaboration leverages Lenzing’s closed-loop production process for regenerated cellulose fibers and OceanSafe’s synthetic material technology to create a durable, recyclable, and cradle-to-cradle certified textile. The launch included a capsule collection showcasing the yarn's application in functional garments.
• In August 2025, Eastman announced a strategic partnership with Huafon Chemical to establish a joint facility in China for the production of sustainable cellulose acetate yarn. This collaboration combines Eastman’s expertise in molecular recycling and biobased material production with Huafon’s manufacturing capabilities to serve the local textile market. The facility will focus on producing Eastman Naia cellulose acetate filament yarns, which are used in luxury and ready-to-wear apparel. This initiative demonstrates a commitment to localizing production to meet the increasing demand for eco-friendly regenerated cellulose materials in the Asian market while reducing supply chain lead times.
• In October 2024, Birla Cellulose, the pulp and fiber business of Grasim Industries, entered into a long-term strategic partnership with the US-based recycling innovator Circ. This collaboration focuses on scaling the production of recycled lyocell fibers by incorporating Circ’s dissolving pulp, which is produced from mixed textile waste. Under the agreement, Birla Cellulose committed to purchasing up to 5,000 tons of this recycled pulp annually for five years from Circ’s first commercial-scale facility. The partnership aims to accelerate the commercialization of circular textiles and enhance the availability of high-quality regenerated cellulose fibers made from recycled feedstock.
• In June 2024, the assets of a prominent Swedish textile-to-textile recycling company were acquired by the private equity firm Altor, securing the future of its pioneering dissolving pulp product. Following the acquisition, the company was rebranded to operate under the name of its flagship product, Circulose, which is derived from 100% textile waste. This strategic move ensured the continued production of the biodegradable raw material used by viscose and lyocell manufacturers to create circular regenerated cellulose fibers. The investment aimed to scale the technology globally and meet the fashion industry's growing demand for sustainable, closed-loop material solutions.

Key Market Players

• Grasim Industries Limited
• Lenzing AG
• GP Cellulose, LLC
• Eastman Chemical Company
• Fulida Group
• Kelheim Fibres GmbH
• CFF GmbH & Co. KG
• Century Textile and Industry Limited
• Celanese Corporation
• Asahi Kasei Corporation

By Type	By Source	By End User Industry	By Company	By Region
Fiber and Film	Wood-Pulp Non-Wood-Pulp and Recycled Pulp/De-inked Pulp	Textile Automotive Packaging Agriculture Others	2021	North America Europe Asia Pacific South America Middle East & Africa

Report Scope:

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

• Regenerated Cellulose Market, By Type:

• Fiber
• and Film

• Regenerated Cellulose Market, By Source:

• Wood-Pulp
• Non-Wood-Pulp
• and Recycled Pulp/De-inked Pulp

• Regenerated Cellulose Market, By End User Industry:

• Textile
• Automotive
• Packaging
• Agriculture
• Others

• Regenerated Cellulose Market, By Company:

• 2021

• Regenerated Cellulose Market, By Region:

• North America
• United States
• Canada
• Mexico
• Europe
• France
• United Kingdom
• Italy
• Germany
• Spain
• Asia Pacific
• China
• India
• Japan
• Australia
• South Korea
• South America
• Brazil
• Argentina
• Colombia
• Middle East & Africa
• South Africa
• Saudi Arabia
• UAE