Lignin Market Size by Raw Material (Hardwood, Softwood, Straw, Sugarcane Bagasse, Corn Stover, Spent Liquor), By Product (Kraft Lignin, Lignosulphonates, Low Purity Lignin, Organosolv Lignin), By Application (Aromatics, Macromolecules), By Downstream Potential (Vanillin, Carbon Fiber, Phenol, BTX, Activated Carbon, Phenolic Resins, Adhesives, Epoxy resins), COVID-19 Impact Analysis, Regional Outlook, Growth Potential, Competitive Market Share & Forecast, 2022 – 2028

Industry Overview

Lignin Market size was valued at more than USD 700 million during 2021 and is predicted to record over 6% CAGR through the forecast timeframe of 2022-2028. Rapidly increasing investments in the development of low-cost coal-based carbon fibers will foster the global market growth.
 

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The demand for lignin will expand from animal feed applications, with the rise in consumption of chicken meat across the world. According to a January 2022 report by the U.S. Department of Agriculture (USDOA), the global chicken meat production in the year is expected to reach 100.8 million tons. This indicates a substantial use of suitable feed ingredients such as lignin in animal feed, with benefits such as high energy source.
 

Governments and private investors are boosting their investments to develop an eco-friendly public infrastructure. This includes railways, roadways, and other transportation modes across both developed and emerging economies. For instance, the Government of India planned to invest more than USD 6.5 billion in the construction of roads and bridges as outlaid in its Union Budget of 2020 - 21. Such initiatives will drive the adoption of lignin, as it is used as a water-reducing admixture and an effective replacement material for cement in the construction sector.
 

Lack of awareness about the advantages and uses of lignin among the industrial and commercial end-users may hinder the lignin market growth. Lignin has a variety of applications in sectors ranging from chemical to food & beverages. However, lack of research on the possible applications of this product may hamper its demand to some extent over the coming years. However, gradual rise in infrastructure investments and high animal feed demand will create opportunities for lignin suppliers, tackling these drawbacks.
 

Use in adhesive production to fuel hardwood lignin demand

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Based on the type of raw material, the hardwood lignin market share was more than USD 160 million in 2021, with a CAGR of over 5% expected through 2028. Hardwood lignin contains a high concentration of S-lignin units and has a low molecular weight, making it useful in the production of several adhesives. It can act as an effective alternative to petrochemical-based adhesives, as this type of lignin is made from plant-based leftovers that remain after harvesting. It causes minimal damage to the environment by making efficient use of biowaste.
 

Increasing need for biofuel to augment low-purity lignin use

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The global low-purity lignin industry share crossed USD 600 million in 2021 and is anticipated to register more than 5% CAGR through 2028. The demand for renewable feedstocks, such as biomass is growing at a significant pace as customers are increasing their preference for eco-friendly fuels. According to the U.K. government’s statistics, in 2020, the total volume of locally sourced biofuels used in the region reached 293 million liters/kilogram, a 5% increase from the 2019 figures. Low-purity lignin can be widely used as a biofuel owing to its ability to generate more energy while burning, as compared to cellulose.
 

Robust demand for cosmetics to drive lignin production

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In terms of the application spectrum, lignin market share from the aromatics segment surpassed USD 350 million in 2021. For aromatic applications, lignin can be extensively utilized in the production of phenol-based compounds. These compounds are used in the cosmetics and skincare industries while producing sunscreen, skin lightening, and hair coloring products. These wide-ranging uses will accelerate the compound demand from the cosmetics sector. Japan, Italy, Brazil, and the U.S. are among the largest cosmetics & personal care markets, indicating robust lignin consumer base.
 

Lignin finds major downstream potential in pharmaceutical sector

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With respect to the downstream potential, global lignin market revenue from the phenol segment is expected to be over USD 20 million by 2028. The pharmaceutical sector is one of the key industry drivers boosting the compound demand. The medical sector is expanding at a healthy rate due to the rising burden of chronic diseases across the globe. It has increased the demand for phenol-based products from the pharmaceutical sector owing to low cost and utilization in a variety of medicinal requirements, such as skin disinfecting and itch relieving products.
 

North America lignin industry shows impressive progress

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North America lignin market size will exhibit more than 5% CAGR through 2022-2028. The construction industry is one of the key contributors to the U.S. economy. As per the Associated General Contractors of America, the construction sector has more than 7.6 million employees and creates structures worth USD 1.4 trillion every year. The rising inclination towards green building projects in the U.S. will amplify lignin demand, as it is a sustainable water-reducing admixture. The material is majorly used as a grinding agent in cement production and can be an eco-friendly cement replacement.
 

Key expansion strategies to boost the global market forecasts

Borregaard LignoTech, Domtar Corporation, Stora Enso, Nippon Paper Industries Co., Ltd., Rayonier Advanced Materials, Domsjo Fabriker AB (Aditya Birla), Burgo Group Spa, Changzhou Shanfeng Chemical Industry Co Ltd, The Dallas Group of America, Inc, Liquid Lignin Company, Ingevity Corporation, and Sigma Aldrich are the leading companies in global lignin industry.
 

Key strategic partnerships, mergers & acquisitions, expansion initiatives, among others, will help these organizations cement their market position. For instance, in December 2020, Stora Enso Oyj set up a lignin granulation and packaging factory, which will ease the packing and handling of lignin in powder and wet form. This will increase Stora Enso's capacity to replace fossil-fuel based raw materials.
 

Impact of COVID-19 on lignin industry outlook

The COVID-19 pandemic had a slightly negative effect on the lignin market progress during 2020, as many industries, including automotive and construction, saw a steep decline in revenue margins due to movement and travel restrictions. The production of lignin may have also taken a hit during this period with slowdown among end-users. However, with these sectors showing gradual but promising recovery as the impact of the pandemic decreases, the product demand will also grow considerably. Strong future demand from animal feed and infrastructure applications could outline key industry trends over the coming years.
 

The lignin market research report includes in-depth coverage of the industry with estimates & forecast in terms of volume in Kilo Tons and revenue in USD Million from 2017 to 2028 for the following segments:

By Raw Material

• Hardwood
• Softwood
• Straw
• Sugarcane bagasse
• Corn stover
• Spent liquor

By Product

• Lignosulfonates
• Kraft lignin
• Low-purity lignin
• Organosolv Lignin
• Others

By Application

• Macromolecules
• Aromatics

By Downstream Applications

• Vanillin
• Carbon fiber
• Phenol
• BTX
• Adhesive
• Phenolic resin
• Epoxy resin

The above information is provided on a regional and country basis for the following:

• North America
  • U.S.
  • Canada
  • Mexico
• Europe
  • Germany
  • UK
  • France
  • Italy
  • Russia
  • Poland
• Asia Pacific
  • China
  • India
  • Japan
  • Thailand
  • South Korea
  • Malaysia
• Latin America
  • Brazil
  • Argentina
• Middle East & Africa
  • Saudi Arabia
  • UAE
  • South Africa 
• Oceania
  • Australia
  • New Zealand