Story | 10/09/2026 13:27:37 | 6 min Read time

The future of chemicals starts with a new source of carbon

Modern life runs on chemicals. They are in packaging, textiles, tires, cosmetics, electronics, construction materials, and thousands of other products that most people rarely think about. Behind almost every chemical value chain sits the same foundation: carbon.

Carbon is everywhere

For the past two centuries, most of that carbon has come from fossil sources. Oil, gas and coal became the building blocks of modern chemistry, helping create the materials and products that shape everyday life. Today, that foundation is being reconsidered. Consumer demand for sustainable products, shifting supply chains, industrial competitiveness, climate targets and technological advances are prompting a broader discussion about where the next generation of chemical feedstocks will come from.

Like other industries, the chemical sector is working to decarbonize. Its challenge is different, though: carbon is not just an emission to cut, but the basic material its products are made from. The task is replacing the oil and gas that have long provided that carbon.

From wood to chemicals

Future chemistry will increasingly rely on a broader range of carbon sources, including renewable and circular feedstocks, such as lignocellulosic biomass. This includes wood, sawmill residues, thinnings, industrial roundwood, and other fibrous plant matter. 

Advances in biorefining make it possible to break this biomass into molecular building blocks for chemicals, materials and fuels that have traditionally come from fossil feedstocks. It can be separated into streams such as sugars and lignin, which are converted into glycols, industrial sugars, functional fillers and other chemical intermediates. 

These materials increasingly find their way into textiles, packaging, tires, batteries, construction materials and a growing range of consumer and industrial applications. Other residue streams can be converted into renewable fuels, creating alternatives to fossil equivalents. 

Why renewable carbon is gaining momentum

Interest in renewable carbon is growing due to a combination of sustainability, regulatory, economic and technological factors. Together, these factors are moving renewable carbon from a niche topic to a strategic consideration for the future of chemical production.

Companies across industries are looking for ways to reduce dependence on fossil resources, while regulations increasingly encourage the use of renewable and circular materials. At the same time, rising material demand highlights the need for additional carbon sources alongside recycling. Renewable feedstocks can help meet those needs while supporting more sustainable value chains. 

At a time when parts of the European chemical sector face significant pressure, renewable and circular carbon sources are also discussed in the context of competitiveness, resource security and long-term resilience. Manufacturers are looking for ways to strengthen supply chains, a question that goes beyond individual companies to where Europe’s industrial materials will come from in the future.  

What’s at stake does not stop at research and development. As biorefining technologies mature and reach commercial scale, they create products and markets that did not exist under the fossil model: new applications for sugars and lignin, new suppliers, and industrial jobs tied to specific regions and their biomass. Researchers and companies are turning technological progress into economic activity, giving the chemical sector a path to grow while lowering its fossil footprint.

Beyond green: proven performance

While sustainability is helping drive demand for renewable chemicals, long-term adoption depends on performance. 

Renewable chemicals do not enter empty markets. They are being adopted in industries with well-established performance requirements and decades of industrial experience behind them. Textile inputs must work in existing production processes. Materials used in tires, batteries or construction products must meet demanding technical specifications. 

In a growing number of applications, renewable chemicals meet the demanding performance specifications long set by fossil alternatives, and in many cases exceed them. As commercial adoption grows, discussions focus as much on product performance as on sustainability credentials.

 
The future of chemicals starts with a new source of carbon
 

From lab to market

Outside laboratories and pilot projects, renewable carbon is already moving through commercial value chains. Industrial facilities are producing renewable fuels, chemicals and materials for customers around the world.

In Lappeenranta, Finland, UPM has produced renewable fuels and renewable naphtha from forestry residues for over a decade. The biorefinery has become part of everyday industrial reality, supplying products into established markets while accumulating years of operational experience.

In Leuna, Germany, UPM has built the world's first industrial-scale biorefinery dedicated to producing chemicals from biomass sourced from sustainably managed forests. Sugars, lignin and other components of biomass are converted into products destined for applications ranging from packaging and textiles to rubber, batteries and construction. The biorefinery is an example of a broader industrial shift in which alternative carbon sources are increasingly being integrated into commercial-scale chemical production.

Together, Lappeenranta and Leuna show how renewable carbon is entering established industrial value chains. Products derived from renewable carbon are moving from biorefineries into markets that have historically relied on fossil feedstocks.

What’s next for biochemicals

Taken together, these developments are creating a tailwind for industrial biochemistry and the wider bioeconomy. 

In the upcoming articles of this series, we will explore the technologies, markets and applications that are helping biochemicals move from promising innovation to mainstream industry solutions.

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