Renewable Naphtha Market Size, Share, By Product Type, Feedstock, Application, and Region - Trends, Analysis, and Forecast till 2035

• Renewable naphtha market size is expected to grow at USD 1749.6 Million by 2035.
• The target market was valued at USD 535.6 Million in 2024.
• Target market is expanding at a CAGR of 13.9%.

Renewable naphtha is an intermediary product that converts to gasoline, plastics, or feedstock for hydrogen production. Target market is driven by increasing demand for eco-friendly alternatives for synthetic plastic, consumer preference toward bio-based products. In addition, consumption of renewable naphtha in production of bio plastics & hydrogen, rising concern regarding harmful greenhouse emissions are another factors propelling growth of the global market. Furthermore, technological advancements which increases the efficiency and cost-effectiveness of production is also anticipated to create opportunities for growth of the global market over the forecast period.

Key Takeaways:

• Europe held the largest share of the market in 2024 due to strong environmental regulations, and strong focus on sustainability.
• Asia Pacific is projected to be the fastest-growing market in the coming years. This is due to increasing energy demand, and rising environmental awareness.

Key Drivers of Target Market:

Sustainability Nature of Renewable Naphtha to Drive Market Growth

Demand for renewable naphtha is rising as it is a sustainable alternative to traditional naphtha. It lowers the carbon footprint and use widely to reduce greenhouse gas emissions as it is made from renewable sources such as biomass, waste materials, and agriculture residues. Thus, many key players are also producing materials by using renewable naphtha for achieving sustainability aim.

• For Instance, in July 2024, SK Geocentric has taken a significant step toward sustainability by producing polyester using renewable naphtha extracted from bio-based process by-products, such as palm fatty acid distillate (PFAD) and used cooking oil.

Restraints:

Limitations of Renewable Naphtha can hamper the Growth of the Market

Some of the limitations of renewable naphtha including high cost, poor reformer feed, difficulty to get it into finished gasoline, difficulty while tracking RIN, and safety concern can limits target market expansion.

• For instance, according to the data published by New Jersey Department of Health & Senior Services, naphtha can affect when breathed in and by passing through skin, its contact can irritate the nose & throat, and exposure to it can cause headache, dizziness, and nausea. Repeated exposure may damage the nervous system and may also affect kidneys.
• Counterbalance Statements: One of the major solutions to this problem is taking safety precautions by wearing safety glasses, a face shield, chemical-resistant gloves, and suitable protective clothing while working with renewable naphtha.

Opportunities & Market Trends:

Advance Technologies Can Create Significant Opportunities in Upcoming Years

The renewable naphtha sector has undergone a radical transformation in recent years due to new innovations and technological advancements. It enhance functionality, efficiency, and production capacity. Advanced technologies, such as pyrolysis, gasification, thermal decomposition, and others used in the production process of renewable naphtha.

• For instance, in May 2024, Honeywell announced a transformational new naphtha to ethane and propane (NEP) process that improve the efficiency of light olefin production and lower CO₂ emissions per metric ton of olefin produced.  

For instance, in February 2022, U.S. engineering conglomerate Honeywell has introduced new technology to produce naphtha from sustainable feedstock such as used cooking oil (UCO) and animal fats. Renewable naphtha from sustainable feeds had a 50%-80% lower greenhouse gas footprint compared to petroleum feeds, depending on the feedstock.

The market is segmented into product type, feedstock, application, and region. 

Product Type

On the basis of product type, the renewable naphtha market is segmented into light naphtha and heavy naphtha. The light naphtha dominate the target market growth due to its versatility, compatibility, high demand, and others.

Feedstock

Based on feedstock, the renewable naphtha market is segmented into wood pulp residue, vegetable oil waste, used cooking oil, animal fat and others. The used cooking oil segment holds the largest renewable naphtha market share due to the growing demand, high conversion efficiency, and also its widespread availability.

• For instance, in February 2024, EcoCeres is one of a handful of companies in the world that can convert used cooking oil into sustainable aviation fuel (SAF) and hydro-treated vegetable oil (HVO), which can be used as substitutes for aviation fuel and diesel, respectively.

Application

By applicationThe renewable naphtha market by application is segmented into fuel blending, feed for H2 production, feed for plastic production, and others. Fuel blending segment is expected to dominate the target market growth as its help to reduce carbon emissions. 

Region

Geographically, the market is studied across North America, Europe, Asia Pacific, Latin America, and the Middle East & Africa.

Europe: Europe is expected to dominate the growth of the market during forecast period due to strong environmental regulations, integration of renewable energy, government policies, presence of large scale industrial projects, strong focus on sustainability, and others.   

• For instance, in October 2023, formal engagement has begun on Lighthouse Green Fuels’ (LGF) Development Consent Order (DCO) application for an advanced sustainable aviation fuel (SAF) facility on Teesside. This will be the largest green-fuel facility in Europe and the most progressed in its development which also produces 30 million liters of green naphtha.

Asia Pacific: Asia Pacific is considered to be the fastest growing region in the target market as countries such as India, China and many more are leading the charge significantly due to rapid urbanization & industrialization, increasing energy demand, government support, environmental awareness, and others. 

For instance, in September 2024, Global energy trader Gunvor Group is growing its Asia operations to expand in existing markets such as liquefied petroleum gas (LPG), naphtha, gasoline and aromatics and into new areas including power.

Renewable Naphtha Market Report Scope:

Segmentation:

By Product Type:

• Light Naphtha
• Heavy Naphtha

By Feedstock:

• Wood Pulp Residue
• Vegetable Oil Waste
• Used Cooking Oil
• Animal Fat
• Others

By Application:

• Fuel Blending
• Feed for H2 Production
• Feed for Plastic Production
  • Ethylene
  • Propylene
  • Butadiene
  • Others
• Others

By Region:

• North America
  • U.S.
  • Canada
• Europe
  • Germany
  • U.K.
  • France
  • Russia
  • Italy
  • Spain
  • Netherlands
  • Rest of Europe
• Asia Pacific
  • China
  • India
  • Japan
  • Australia
  • Indonesia
  • Malaysia
  • South Korea
  • Rest of Asia Pacific
• Latin America
  • Brazil
  • Mexico
  • Argentina
  • Rest of Latin America
• Middle East & Africa
  • GCC
  • Israel
  • South Africa
  • Rest of Middle East & Africa

The key players operating in the renewable naphtha market include World Energy, LLC, PAO NOVATEK, Indian Oil Corporation Ltd,, Shell, Chevron, and among others. These key players focusing on different organic and inorganic strategies, such as acquisition, merger, partnership, agreement, product launch and approval to expand their product portfolio and strengthen their market presence globally.

• For instance, In November 2021, Hyundai Oilbank Co. produced naphtha by injecting plastic waste pyrolysis oil into the process of refining crude oil, poised to become the first South Korean refiner to produce the key petrochemical feedstock in such an eco-friendly method. 

List of Key Players in the Market:

• World Energy, LLC
• PAO NOVATEK
• Indian Oil Corporation Ltd
• Shell
• Chevron
• EXXONMOBIL
• SABIC
• UPM
• SolvChem
• QatarEnergy
• Vinati Organics Limited
• Clean Planet Energy

• In June 2024, QatarEnergy entered into a long-term agreement to supply ENEOS Corporation, a prominent refining and petrochemical company based in Japan, with up to 9 million tons of Naphtha over 10 years. This agreement is the largest and longest commitment in more than a decade of collaborations between the two companies.
• In April 2024, JX Nippon Oil & Gas Exploration Corporation and Sumitomo Corporation executed consortium agreements to manage investment in the Louisiana Green Fuels BECCS project at Port of Columbia, Caldwell Parish, Louisiana. The Project is developing a sustainable aviation fuel (“SAF”) production plant with renewable Naphtha as a byproduct utilizing woody biomass waste, such as thinning, with the production capacity of 32 million gallons (120,000 kiloliters) per year.

Analyst View:      

The industry for renewable naphtha market is placed for substantial growth due to increasing demand for eco-friendly alternatives for synthetic plastic, consumer preference towards bio-based products, consumption of renewable naphtha in production of bio plastics & hydrogen, and rising concern regarding harmful greenhouse emissions. New innovations and development, advance technologies and many collaborations and partnerships help to boost the growth of the market in upcoming years.

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