U.S. Polyurethane (PU) Foam Market size is forecast to reach around $12 billion by 2025, after growing at a CAGR of 7% during 2020-2025. Polyurethane foam is a highly flexible material that finds a wide range of applications in end-use industries such as automotive, furniture, construction, and packaging. Whereas, the increase in demand for light weight products with good durability and strength is driving the demand for polyurethane foam across these industries. Moreover, rising environmental concerns and the presence of substitutes such as polypropylene (PP), Polystyrene, and Polyethylene acts as a restraining factor for the growth of U.S. polyurethane foam market.
Key Takeaways
- Polyurethane foams provide good thermal and sound insulation which in turn increase their use in construction industries for soundproof tiles and panels.
- Coronavirus pandemic has led the downfall in prices of crude oil which further impacts the growth of the U.S. polyurethane foam market.
- Trade war between the U.S. and China has increased the concerns of manufactures to compete in the market due to the imposition of high tariffs.
Type - Segment Analysis
Based on the type, flexible polyurethane foam segment holds the largest share of more than 40% in the U.S. polyurethane foam market in 2019. They are used as cushioning material in variety of consumer and commercial products including furniture, bedding, pillows, carpets, and mattresses. Lightweight, water resistance, shock absorption, and resiliency make them suitable for packing sensitive equipment’s such as electronic circuit boards, jewelry, and delicate foods. Furthermore, an increase in the use of flexible foam in the textile and fiber industries for making tents, life rafts, and handbags is boosting the growth of U.S. polyurethane foam market during the forecast period.
Application – Segment Analysis
The transportation segment is projected to witness a highest CAGR of 9.5% in the U.S. polyurethane foam market during the forecast period. Durability coupled with strength, makes polyurethane foam ideal not only for cushioning purposes but also within the bodies of an automobile where they provide insulation against heat and noise of the engine. Polyurethane foams lower the environmental impact of vehicles by reducing the weight of the vehicle. This improves fuel efficiency and also lower emission levels. According to International Energy agency, (IEA) electric car deployment has grown rapidly over the past ten years, with the global stock of electric passenger cars passing 5 million in 2018, an increase of 63% from the previous year and US accounted for 22% of the global fleet. Thus increase in EV also increases the use of polyurethane foams for headrest, seats, armrest, etc. substantially boosting the growth of U.S. polyurethane foam market.
COVID-19 has badly impacted the transportation sector. Most of the automotive or aerospace manufacturing industries have stopped their production. People stuck in their houses due to increasing coronavirus cases. Total number of confirmed cases in the U.S. reached 981,246 on 28th April 2020. Also, the 2020 French F1 GP which was scheduled to take place on June 28 has been canceled. According to Accenture, automotive sales in the U.S. is estimated to decline by 15% in 2020. Additionally, decline in tours and travels due to the cancellation of large number of international as well as domestic flights across the globe has badly affected the aviation industry. According to International Air Transport Association (IATA), COVID-19 crisis will make global airline passenger revenues drop by US$314 billion in 2020, a 55% decline compared to 2019. Thus, upheaval in transportation sector will hamper the growth of U.S. polyurethane foam market size.
Drivers – U.S. Polyurethane Foam Market
- Growing demand from end use industries
Polyurethane foams do not absorb moisture and also behaves as a thermal insulator owing to its use in various applications such as insulation sheets for refrigerators, fillings for beds and cushions, seals, and gaskets. According to the U.S. Department of Energy, heating and cooling account for about 56 percent of the energy use in the U.S. homes every year. In order to maintain uniform temperature and lower noise levels, constructors prefer polyurethane foams that can be used in roof, walls, and windows for insulation and air barrier sealants. Whereas, according to the U.S. Census Bureau, total construction spending in the U.S. has increased by 6.03% from February 2018 and estimated to be 1,366,697 $Mn in February 2020. Thus, increase in renovation and construction activities boosts the growth of the U.S. Polyurethane Foam Market share during the forecast period.
- Exceptional properties of polyurethane foams
Unlike polyethylene, polyurethane is a softer, open-cell type of foam because the cells are open and not cross-linked. Air can flow throughout the foam making the foam softer and giving them an advantage over polyethylene to absorb shock energy better. It does not try to rebound as quickly as polyethylene and distributes the energy of the compression throughout the foam surface. Exceptional shock absorbing properties rose its need to provide more crash protection, substantially augmenting its market growth.
Challenges – U.S. Polyurethane (PU) Foam Market
- Volatile prices of raw material and harmful effects of polyurethane foam
Polyurethanes are produced when diisocyanates (methylene diphenyl diisocyanate or toluene diisocyanate) react with polyols. Both of the products such as polyols and diisocyanates are derived from crude oil. According to the United States Environmental Protection Agency (USEPA), exposure to diisocyanates can cause negative health effects, such as asthma, lung damage, respiratory problems, and skin and eye irritation. Furthermore, the outbreak of coronavirus has resulted in the downfall of economy. The U.S. crude oil prices turn negative due to lower demand and lack of storage facilities. The price of a barrel of West Texas Intermediate (WTI), fell as low as minus $37.63 a barrel on 21st April 2020. Thus harmful effects and volatile prices of materials restrains the growth of U.S. polyurethane foam industry during the forecast period.
Market Landscape
Technology launches, acquisitions and R&D activities are key strategies adopted by players in the U.S. polyurethane foam market report. In 2019, the market of U.S. polyurethane foam top 10 players accounting for xx% of the share. Major players in the U.S. polyurethane foam market outlook are, Covestro AG, Huntsman International LLC, LANXESS, BASF SE, and Dow, among others.
Acquisitions/Technology Launches
- In February 2020, Huntsman has acquired the Icynene-Lapolla, in order to expand its downstream footprints in spray polyurethane foam insulation. The acquisition has created Huntsman the leading supplier of spray foam products used to insulate commercial and residential structures.
- In May 2019, BASF and Liyang Shanhu Industry Auto Trim Material Co., Ltd. (“Shanhu Industry”) has signed a strategic cooperation agreement to develop lightweight and low-emission polyurethane (PU) system product to meet the market demand in China’s automotive industry.
