At 4.4% CAGR, the South America Lignin Market is projected to be worth US$ 35,261.05 thousand by 2028, says Business Market Insights

According to Business Market Insights’ research, the South America lignin market was valued at US$ 27,289.61 thousand in 2022 and is expected to reach US$ 35,261.05 thousand by 2028, registering a CAGR of 4.4% from 2022 to 2028. Growing demand of lignin from several end-use industries and government regulations and initiatives to promote sustainable and bio-products are the critical factors attributed to the South America lignin market expansion.             

Lignin is widely used in many industrial applications owing to its aromatic structure, relatively high energy content, and sustainability. Hence, the demand for lignin and its use is increasing across various end-use industries such as construction, paper & pulp, agriculture, animal feed, water treatment, and biofuel. Lignin is utilized in the building materials and construction industry as a set retardant, water-reducing admixture, and grinding agent in cement production. Lignin is used as a cement replacement material. It strengthens concrete by increasing its compressive strength; thus, its usage decreases carbon dioxide emissions during cement production and reduces the risk of depletion of natural material used for concrete production. A major advantage of using lignin is making the concrete process sustainable. Thus, the increasing use of lignin in concrete admixtures is driving the demand for lignin. Less than 2% of lignin is used as a dispersant, surfactant, and wood adhesive, while the rest is consumed as a direct combustion fuel to supply internal energy in biomass processes. In addition, lignin is the largest natural source of aromatics, which can potentially replace petroleum-based chemicals. Consumers are increasingly shifting toward eco-friendly products. Hence, the demand for bio-based, renewable, and circular solutions is increasing. For instance, Lineo, a high-purity kraft lignin material by Stora Enso Oyj, can replace fossil-based glue in plywood. In February 2023, Paged, a Polish plywood manufacturer, collaborated with Stora Enso Oyj to cater to customers’ demands for sustainable and bio-based plywood. This partnership allowed Paged to reduce carbon emissions through its products. Furthermore, increasing demand for sustainable products has prompted several manufacturers to produce bio-based products such as bio-based plastics, lignin-based resins, lignin-based binders, lignin-based composites, bio-asphalt, biofuel, and bio-coatings, among others. In 2019, Latvijas Finieris developed RIGA ECOlogical in collaboration with Stora Enso Oyj. RIGA ECOlogical is eco-friendly lignin gluing technology aimed at replacing fossil-based phenol utilized in plywood production. In addition, lignin is used as an animal feed additive and offers multiple functionalities for improved productivity in the animal nutrition & health industry. Purified Alcell lignin can exhibit prebiotic effects in chickens, favoring the growth of good bacteria and improving the morphological structures of the intestines, as measured by increased villi height and goblet cell number. These findings suggest that purified lignin can offer health benefits in monogastric animals and serve as a potential natural feed additive. Hence, animal feed manufacturers increasingly use lignin as a natural feed additive. Therefore, the growing demand of lignin from several end-use industries drives market growth.

On the contrary, availability of substitutes for lignin hurdles the growth of South America lignin market. 

Based on type, the South America lignin market is categorized into lignosulfonates, kraft lignin, high purity lignin, and others. The lignosulfonates segment held 86.4% market share in 2022, amassing US$ 23,580.47 thousand. It is projected to garner US$ 30,413.41 thousand by 2028 to expand at 4.3% CAGR during 2022–2028.

Based on form, the South America lignin market is bifurcated into solid and liquid. The solid segment held 91.8% market share in 2022, amassing US$ 25,049.22 thousand. It is projected to garner US$ 32,435.87 thousand by 2028 to expand at 4.4% CAGR during 2022–2028.

Based on application, the South America lignin market is categorized into concrete additives, plastics and polymers, bitumen, water treatment, dyes and pigments, activated carbon, carbon fiber, and others. The others segment held 21.2% share of South America lignin market in 2022, amassing US$ 5,793.73 thousand. It is projected to garner US$ 6,837.43 thousand by 2028 to expand at 2.8% CAGR during 2022–2028.

Based on country, the South America lignin market has been categorized into Brazil, Argentina, and the Rest of South America.  Our regional analysis states that Brazil captured 61.7% share of South America lignin market in 2022. It was assessed at US$ 16,824.77 thousand in 2022 and is likely to hit US$ 22,140.41 thousand by 2028, exhibiting a CAGR of 4.7% during the forecast period.            

Key players dominating the South America lignin market are Nippon Paper Industries Co Ltd; Borregaard ASA; Burgo Group SpA; Domsjo Fabriker AB; Sappi Ltd; Stora Enso Oyj; Suzano SA; and The Dallas Group of America Inc among others.

• In Feb 2023, Stora Enso Oyj and Valmet collaborated to develop next-generation lignin.
• In May 2021, Suzano SA invested US$ 2.8 billion in the first fossil-free pulp plant in Brazil.

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