Market Definition

Polyols are organic compounds containing multiple hydroxyl groups, commonly used as key raw materials in the production of polyurethanes and other polymer products. The market encompasses a range of products including polyester and polyether polyols, used in applications such as flexible and rigid foams, coatings, adhesives, sealants, and elastomers.

It serves industries like construction, automotive, packaging, and furniture. The report examines critical driving factors, industry trends, regional developments, and regulatory frameworks impacting market growth through the projection period.

Polyols Market Overview

The global polyols market size was valued at USD 40.12 billion in 2024 and is projected to grow from USD 42.02 billion in 2025 to USD 59.92 billion by 2032, exhibiting a CAGR of 5.20% during the forecast period.

The market is witnessing strong growth due to rising demand from end-use industries such as construction, automotive, and consumer goods. A key factor driving market expansion is the increasing use of polyurethane foams in insulation and cushioning applications. Growing focus on energy efficiency in buildings has led to higher adoption of rigid foam insulation, which relies heavily on polyols.

Key Highlights

The polyols industry size was valued at USD 40.12 billion in 2024.
The market is projected to grow at a CAGR of 5.20% from 2025 to 2032.
Asia Pacific held a market share of 45.09% in 2024, with a valuation of USD 18.09 billion.
The polyether polyols segment garnered USD 31.94 billion in revenue in 2024.
The flexible polyurethane foam segment is expected to reach USD 21.78 billion by 2032.
The building & construction segment is expected to reach USD 15.23 billion by 2032.
The market in North America is anticipated to grow at a CAGR of 3.95% during the forecast period.

Major companies operating in the global polyols market are BASF, Covestro AG, Dow, Shell plc, Huntsman International LLC, Wanhua, Repsol, PCC SE, Emery Oleochemicals, Stepan Company, Mitsui Chemicals, Inc., Arkema, LANXESS, RAG-Stiftung, and SABIC.

Polyols Market Size & Share, By Revenue, 2025-2032

Growing demand for comfort-oriented furniture and bedding is driving the use of polyols in flexible foams. Expanding industrial output is increasing polyol use in coatings and adhesives. The shift toward sustainability is also boosting the adoption of bio-based polyols, supporting product innovation and market expansion.

In October 2024, the Mitsubishi Chemical Group introduced its plant-derived polyol, BioPTMG, for use by Kahei Co., Ltd. in bio-synthetic leather products, including bags and accessories. BioPTMG offers high flexibility, durability, and a biomass content exceeding 92%, supporting sustainability and reduced greenhouse gas emissions.

Market Driver

Increasing Demand for High-Performance Polyether Foams

The polyols market is driven by increasing demand for polyether foams used in mattresses, upholstered furniture, and seating. These applications require materials with strong insulation, cushioning, and structural properties. Polyols are essential in producing flexible polyurethane foams that offer enhanced softness, durability, and comfort.

Rising consumer expectations for high-quality, long-lasting furniture and bedding products are prompting manufacturers to adopt advanced polyol formulations. Additionally, ongoing innovation in polyol technologies designed for specific end-use performance is further supporting market growth.

In December 2024, Dow began production of VORANOL WK5750, a high-performance polyether polyol, at its Freeport polyol plant. Designed for hypersoft and viscoelastic foam applications, the product enhances comfort in mattresses and furniture while offering superior reactivity, controlled viscosity, and improved aesthetic quality. The launch supports Dow’s focus on specialty polyols for advanced flexible foam solutions.

Market Challenge

Supply Chain Constraints and Raw Material Availability

The polyols market faces a significant challenge due to constrained supply chains and inconsistent availability of key raw materials, especially for bio-based and specialty polyols. Price volatility and reliance on limited feedstocks disrupt production continuity and create cost management issues for manufacturers. These constraints limit the industry’s ability to meet rising demand while maintaining stable pricing.

To mitigate this, companies are diversifying raw material sources and strengthening supply chain resilience. Efforts include developing alternative feedstocks, expanding supplier networks, and investing in advanced manufacturing technologies that enhance operational flexibility and maintain consistent product quality despite input variability.

Market Trend

Growing Adoption of Sustainable Bio-Based and CO₂-Based Polyols

The polyols market is witnessing a significant trend toward the adoption of bio-based and CO₂-based polyols. Manufacturers are increasingly prioritizing sustainable alternatives to conventional fossil-based polyols to reduce carbon emissions and align with global environmental regulations. These renewable polyols offer lower greenhouse gas footprints and contribute to the circular economy by utilizing captured carbon and renewable resources.

This shift supports sustainability goals while encouraging the development of polyol formulations that retain or improve product performance. The growing demand for eco-friendly materials is expected to accelerate the development and commercialization of bio-based and CO₂-based polyols across various industries.

In October 2024, Capricorn Partners invested in Econic Technologies to accelerate the delivery of CO₂-based polyols and support the commercialization of its new CO₂ surfactant technology. This investment is expected to facilitate the scaling of sustainable polyols and surfactants across industries such as furniture, automotive, coatings, and textiles, enabling customers to reduce carbon footprints and enhance product performance.

Polyols Market Report Snapshot

Segmentation	Details
By Type	Polyether Polyols, Polyester Polyols
By Application	Flexible Polyurethane Foam, Rigid Polyurethane Foam, CASE, Others
By End-use Industry	Building & Construction, Automotive, Furniture & Bedding, Packaging, Electronics
By Region	North America: U.S., Canada, Mexico
	Europe: France, UK, Spain, Germany, Italy, Russia, Rest of Europe
	Asia-Pacific: China, Japan, India, Australia, ASEAN, South Korea, Rest of Asia-Pacific
	Middle East & Africa: Turkey, U.A.E., Saudi Arabia, South Africa, Rest of Middle East & Africa
	South America: Brazil, Argentina, Rest of South America

Market Segmentation

By Type (Polyether Polyols and Polyester Polyols): The polyether polyols segment earned USD 31.94 billion in 2024 due to its extensive use in flexible foam applications and coatings
By Application (Flexible Polyurethane Foam, Rigid Polyurethane Foam, CASE, and Others): The flexible polyurethane foam segment held 39.20% of the market in 2024, due to the growing demand in furniture and automotive seating.
By End-use Industry (Building & Construction, Automotive, Furniture & Bedding, Packaging, and Electronics): The building & construction segment is projected to reach USD 15.23 billion by 2032, owing to the increased adoption of energy-efficient insulation materials.

Polyols Market Regional Analysis

Based on region, the market has been classified into North America, Europe, Asia Pacific, Middle East & Africa, and South America.

Polyols Market Size & Share, By Region, 2025-2032

Asia Pacific polyols industry accounted for a substantial share of 45.09% in 2024 in the global market, with a valuation of USD 18.09 billion. This region holds the largest share of the market due to its fast-paced industrial growth, especially in China and India. The construction boom in these countries drives demand for energy-efficient insulation materials made from polyols.

The automotive sector’s expansion increases consumption of flexible and rigid polyurethane foams used for lightweight and durable components. The region's low production costs and access to raw materials are attracting global manufacturers. The expansion of manufacturing hubs in Southeast Asia is also boosting regional supply capacity and shortening lead times, supporting market growth.

In June 2024, Changhua Chemical began construction of China’s first production plant for polyols made from renewable carbon in Lianyungang, Jiangsu. The facility will manufacture Carnol, a new line of polycarbonate ether polyols with 20–30% fewer greenhouse gas emissions. Developed using Econic Technologies’ proprietary CO₂-based catalyst process, Carnol polyols support sustainable polyurethane applications across sectors such as construction, automotive, furniture, and apparel.

North America polyols market is expected to register the fastest growth, with a projected CAGR of 3.95% over the forecast period. This growth is attributed to its focus on innovation and sustainable solutions. This growth is driven by rising demand for bio-based polyols, supported by regulatory policies and industry initiatives focused on reducing environmental impact.

The region’s automotive sector is also contributing to market expansion through increased use of polyurethane foams in lightweight components, which help improve fuel efficiency. In addition, the construction industry's emphasis on energy-efficient buildings is driving the adoption of polyol-based insulation materials.

Growth in the furniture and packaging sectors, along with strong R&D capabilities and established manufacturing infrastructure, is further accelerating the adoption of advanced polyol technologies across North America.

Regulatory Frameworks

In the U.S., the Environmental Protection Agency (EPA) regulates polyol production under the National Emission Standards for Hazardous Air Pollutants (NESHAP), focusing on limiting emissions of hazardous air pollutants. The Food and Drug Administration (FDA) oversees polyols used in food products, recognizing them as Generally Recognized as Safe (GRAS). The FDA also enforces labeling requirements for products containing polyols, including declarations of sugar alcohol content and relevant health warnings.

Competitive Landscape

The polyols industry is characterized by key players focusing on strategic initiatives to strengthen their market positions. Companies are prioritizing the development of advanced and sustainable polyol formulations, including bio-based variants, to meet evolving customer needs. Expansion of production capacities through new manufacturing facilities and capacity upgrades is common to enhance supply chain efficiency.

Moreover, key players are forming strategic partnerships and collaborations with raw material suppliers and end-use industry leaders to secure raw material availability and improve market reach. Additionally, they are investing in geographic expansion to enhance market share.

In October 2024, Econic Technologies and Chimcomplex signed a memorandum of understanding to explore the production of CO₂-based polyols in Europe. The collaboration aims to introduce sustainable polyol technology using captured CO₂ to reduce carbon footprints and enhance material performance across various industries. This partnership supports the advancement of eco-friendly polyols in Europe.

List of Key Companies in Polyols Market:

BASF
Covestro AG
Dow
Shell plc
Huntsman International LLC
Wanhua
Repsol
PCC SE
Emery Oleochemicals
Stepan Company
Mitsui Chemicals, Inc.
Arkema
LANXESS
RAG-Stiftung
SABIC

Recent Developments (Product Launch)

In September 2024, Ingevity Corporation introduced Capa HS, a next-generation line of polycaprolactone polyols designed for enhanced hydrolytic resistance in polyurethane elastomers. The new series targets demanding applications in offshore, mining, and petroleum industries, offering improved durability in wet and humid environments.