The levulinic acid market is projected to reach USD 32.5 Million by 2021, at a CAGR of 14.0% between 2016 and 2021. The key factor fueling the growth of the levulinic acid market is the increasing demand for levulinic acid from plasticizers, pharmaceuticals, and cosmetic industries. Levulinic acid is used in anti–inflammatory medication, and mineral supplements in pharmaceutical applications.

Major application industries using levulinic acid are plasticizers, pharmaceuticals & cosmetics, and others. The demand from these industries for levulinic acid is projected to grow in the coming years, as these acids are bio-based and renewable. With fluctuations in crude oil prices, these industries are compelled to use renewable feedstock instead of petrochemical-based feedstock. Use of levulinic acid would not only bring economic benefits, but also help in addressing rising concerns of greenhouse gas emissions.

Based on application, the levulinic acid market has been segmented into plasticizers, pharmaceuticals & cosmetics, and others. The plasticizers segment accounted for the largest share of the levulinic acid market in 2015. The pharmaceuticals & cosmetics segment is expected to grow at the fastest rate during the forecast period. Levulinic acid are widely preferred in cosmetic products for its broad compatibility and biodegradable properties.

Based on technology, the levulinic acid market has been segmented into acid hydrolysis and biofine process. Acid hydrolysis production process is a technology used by most Chinese manufacturers, in which the feedstock used is paper mill sludge, energy crops, among others. The by-product in this technology is tar, which can be used for energy and power generation. Biofine process is one of the key processes used in the European levulinic acid market, which are designed by the BioFine Company.

The levulinic acid market in Europe is anticipated to grow at the highest CAGR between 2016 and 2021. Development of cost competitive levulinic acid, combined with high chemical functionality, is expected to increase the demand for levulinic acid as a platform chemical.

The market study demonstrates that levulinic acid and its derivatives, such as MTHF, DALA, and DPA will be far less expensive than petrochemicals, making its use possible for commercial purposes. In addition, if levulinic acid is used as a base material, the entire suite of chemicals is derived from renewable feedstock.

Leading players operating in the levulinic acid market are Biofine International Inc. (U.S.), Avantium (Netherlands), GF Biochemicals Ltd. (Italy), Langfang Triple Well Chemicals Co. Ltd. (China), Simagchem Corporation (China), Hefei TNJ Chemical Industry Co., Ltd. (China), Great Chemicals Co. Ltd. (China), and Anhui Herman Impex Co Ltd (China), among others.

Renewable chemicals have generated considerable interest in consumers. However, consumers are unwilling to pay more for them, as besides high initial cost, use of renewable chemicals also involves modification costs, such as alterations in production processes.

GF Biochemical (Italy) is a leading player in the levulinic acid market. Other key players operational in the levulinic acid market are Biofine Inc. (U.S.), Avantium (Netherlands), Langfang Triple Well Chemicals Co. Ltd. (China), Simagchem Corporation (China), and Anhui Herman Impex Co. Ltd. (China), among others. These players are most active in the levulinic acid market and have an established distribution network. These players are investing more in research & development activities and expansion of capacities. They also have strong technical and market development capabilities, which enable them to upgrade their existing products for new applications.

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