Polyol Foam Recycling: 2025’s Breakthrough Tech & Market Winners Revealed

20 May 2025
No Comments
Innovation, Market Trends, News, Technology

Table of Contents

2022 New EPS Recycle Machine, EPS Foam Recycling Pulverizer, Foam Crusher

The polyurethane (PU) foam industry is experiencing a pivotal transformation in 2025, driven by increasing regulatory scrutiny, environmental commitments, and advances in recycling technologies. Polyol-based polyurethane foam recycling, which focuses on recovering polyols—the key building blocks of PU foam—has emerged as a crucial strategy for closing the loop in the PU value chain. The sector is characterized by rapid technological advancements, scaling of pilot projects to commercial operations, and growing collaboration between material producers, recyclers, and end-users.

Recent years have seen significant investments in glycolysis and other chemical recycling methods that depolymerize end-of-life foams to recover high-purity polyols suitable for reintroduction into foam manufacturing. In 2025, Covestro AG is operating a dedicated pilot plant in Leverkusen, Germany, utilizing its proprietary “smart chemolysis” process to recycle post-consumer flexible PU foam from mattresses, with the ambition to scale up production capacity over the next few years. The process reportedly enables the recovery of polyols with quality on par with virgin materials, supporting the manufacture of new PU products with significant recycled content.

Similarly, BASF SE has expanded its “Chemical Recycling of Polyurethane Mattress Foams” project, focusing on closed-loop recycling using its own glycolysis technology. BASF’s pilot facilities are now supplying recycled polyols to select mattress manufacturers, with plans to commercialize the process and make recycled-content mattresses widely available by 2026. The company’s efforts address both technical hurdles—such as the removal of legacy additives—and market barriers, including stakeholder alignment along the collection and processing value chain.

Mechanical recycling remains relevant for certain PU foam waste streams, yet chemical processes are gaining traction due to their ability to deliver higher-quality recyclate and enable repeated recycling cycles. Companies such as Huntsman Corporation are partnering with recyclers and downstream users to evaluate the integration of recycled polyols into automotive and furniture applications, highlighting industrial demand for circular PU solutions.

Looking ahead, Europe’s forthcoming End-of-Life Vehicle (ELV) and Ecodesign directives are expected to further stimulate investment and innovation in PU foam recycling. Industry leaders anticipate that, by 2027, chemically recycled polyols will comprise an increasing share of PU foam production, reducing dependence on fossil feedstocks and supporting corporate sustainability goals. Collaboration across the supply chain and continued advancements in process efficiency will be essential for scaling these technologies and achieving economically viable, high-quality recycled polyurethane products.

2025 Market Forecast: Growth Drivers and Revenue Projections

The market for polyol-based polyurethane (PU) foam recycling technologies is poised for significant expansion in 2025, driven by regulatory pressures, corporate sustainability initiatives, and advances in chemical recycling processes. Polyurethane foams, widely used in furniture, automotive, and construction, represent a major waste challenge. The push toward a circular economy has intensified interest in recycling routes that recover high-value polyols from post-consumer and post-industrial foam waste.

In the European Union, the implementation of the Circular Economy Action Plan and the EU Green Deal has set ambitious targets for plastics recycling, directly influencing the polyurethane sector. The Covestro AG is actively scaling up its proprietary chemolysis process, which depolymerizes PU foam into original polyol raw materials. The company is targeting industrial-scale demonstration in 2025, with commercial deployment expected soon after. Covestro’s commitment is mirrored by other leading players such as BASF SE, which is piloting chemical recycling plants capable of handling a variety of flexible and rigid PU foam waste streams.

These efforts are supported by automotive and furniture manufacturers seeking to meet recycled content targets. For instance, IKEA has partnered with technology companies to integrate recycled polyols into its mattress production lines, with pilot-scale implementation set for late 2025. Similarly, Johnson Controls is piloting closed-loop recycling solutions for PU foam insulation used in building applications.

Revenue projections for this segment are buoyed by the premium commanded by recycled polyols, which can substitute for virgin polyols in many applications. By 2025, commercial production from chemical recycling is expected to reach several thousand tons annually in Europe alone, with parallel growth anticipated in North America and Asia as regulatory frameworks tighten and landfill fees rise. The European Diisocyanate & Polyol Producers Association (ISOPA) forecasts that recycled polyols could supply up to 10% of total polyol demand for flexible foams by 2027, up from less than 2% in 2024.

Looking ahead, the outlook for polyol-based PU foam recycling technologies remains robust, with scale-up of depolymerization plants, new partnerships in end-use sectors, and the integration of digital tracking to ensure material traceability. These factors collectively point to accelerating revenues and wider market adoption through 2025 and the following years.

Core Recycling Technologies: Mechanical, Chemical, and Emerging Methods

Polyurethane foams, particularly those based on polyols, present both challenges and opportunities for recycling due to their complex cross-linked structures and widespread applications in automotive, furniture, and insulation industries. As of 2025, the recycling of polyol-based polyurethane foams is advancing through three principal technology pathways: mechanical recycling, chemical recycling (notably glycolysis and hydrolysis), and emerging methods such as enzymatic and catalytic depolymerization.

Mechanical recycling remains the most established and commercially practiced route, involving physical processes like shredding and rebonding to produce carpet underlays or acoustic panels. However, this approach does not recover the original polyols and is generally limited to non-critical, lower-value applications. Companies such as BASF and Huntsman Corporation continue to operate facilities that utilize mechanical recycling for production scraps and post-consumer waste, integrating recycled materials into new foam products where feasible.

Chemical recycling, particularly glycolysis, is gaining traction as a means of recovering polyols from end-of-life polyurethane foams. This process involves reacting the foam with glycols at elevated temperatures to depolymerize the urethane bonds, yielding polyol-rich liquids suitable for new foam formulations. In 2024 and into 2025, Covestro has scaled up pilot plants in Europe that utilize proprietary glycolysis technology, aiming for industrial-scale output and integration into circular supply chains. Similarly, Evonik Industries is actively investing in glycolysis-based pilot projects, targeting both flexible and rigid foam waste streams. Chemical recycling offers the advantage of producing secondary polyols with properties comparable to virgin materials, and several foam manufacturers are working closely with chemical producers to validate and certify these recycled polyols in new products.

Emerging methods such as enzymatic depolymerization and advanced catalytic processes are being explored for their potential to operate under milder conditions and offer higher selectivity. In 2025, research consortia led by Dow and academic partners are piloting enzyme-based approaches that selectively break down polyurethane networks into recoverable polyols and amines. While these technologies are not yet commercially deployed, early results show promise for expanding the types of polyurethane waste that can be efficiently recycled.

Looking ahead, the outlook for polyol-based polyurethane foam recycling in the next few years is positive, driven by tightening regulations on landfill disposal, producer responsibility initiatives, and growing demand for sustainable materials from major brands. Industry leaders anticipate incremental improvements in process economics and expanded adoption of chemical recycling, with the goal of developing closed-loop systems for polyurethane foams by the late 2020s.

Polyol Recovery Processes: Innovation Pipelines and Patent Activity

As industries intensify efforts to establish a circular economy for polyurethane (PU) foams, polyol recovery processes have become a focal point for technological innovation and competitive patent activity. The urgency to recycle PU foam, which is extensively used in furniture, automotive, and construction, is driven by regulatory pressures and an increasing emphasis on sustainable materials management. In 2025 and the coming years, advancements in chemical recycling—particularly glycolysis, hydrolysis, and aminolysis—are set to transform the recovery of polyols from post-consumer and post-industrial PU waste streams.

Glycolysis remains the most widely implemented chemical recycling process, involving the depolymerization of PU foam using glycols to extract liquid polyol fractions that can be reintegrated into new foam production. Companies such as Covestro have scaled up pilot plants and are pursuing industrial-scale projects for flexible foam recycling, with reported investments into proprietary glycolysis technology that delivers high-quality recycled polyols suitable for demanding applications. In 2022, Covestro inaugurated a dedicated pilot plant in Leverkusen, Germany, targeting flexible PU foam from mattresses, and the company’s innovation pipeline through 2025 includes process optimization for scalability and cost efficiency.

Meanwhile, BASF has developed its “chemical recycling of polyurethanes” platform, focusing on both glycolysis and hydrolysis, and has been filing patents related to catalyst systems that improve selectivity and yield of recycled polyols. Their collaborations with mattress manufacturers and automotive suppliers are expected to result in demonstration projects and licensing activity during 2025. Patent filings in this space are increasingly focused on closed-loop recycling and minimizing the need for virgin feedstocks.

New entrants and established players alike are pursuing intellectual property around process intensification and contaminant removal. Repsol has announced proprietary aminolysis technology for automotive PU foams, aiming for commercial deployment by 2026. The company is also developing pre-treatment steps to address the challenge of mixed and contaminated waste streams, a key obstacle for high-grade polyol recovery.

Industry consortia and technical alliances are fostering pre-competitive research, as seen in initiatives coordinated by European Diisocyanate & Polyol Producers Association (ISOPA). These groups are supporting pilot projects, sharing best practices, and providing a forum for patent holders to discuss licensing, standardization, and regulatory aspects. Given the volume of patent activity and the drive for commercial-scale adoption, the next few years are likely to see a convergence of chemical and digital process innovations, with data-driven control systems and molecular-level process tracking entering the mainstream of PU foam recycling.

In summary, polyol recovery processes are poised for rapid technological maturation and commercial deployment between 2025 and 2027, with leading chemical producers, technology developers, and industry alliances driving both innovation and the strategic management of intellectual property.

Major Industry Players and Their Strategic Initiatives

Polyol-based polyurethane (PU) foam recycling has attracted considerable investment and innovation from major industry players, responding to increasing regulatory pressure and sustainability targets in 2025. Companies are advancing both chemical and mechanical recycling technologies to recover polyols for reuse in flexible and rigid foam applications. Several multinationals have established pilot plants, commercialization partnerships, and supply agreements to accelerate market adoption.

A leading example is Covestro, which has scaled up its proprietary chemical recycling process for PU foams, known as “smart polyol recovery.” In 2024, Covestro expanded its recycling activities, demonstrating the process at an industrial pilot plant in Leverkusen, Germany. By 2025, Covestro is collaborating with mattress manufacturers and furniture companies to feed recycled polyols back into the value chain, aiming for commercial-scale output within the next two years.

Similarly, BASF is advancing its ChemCycling™ project, focusing on breaking down post-consumer PU foam waste to regenerate high-quality polyols. BASF’s pilot projects in Europe, supported by partnerships with furniture and automotive OEMs, have yielded recycled polyols that meet stringent performance requirements. In 2025, BASF is targeting increased production capacity and integration of recycled content into mass-market foam products.

In the United States, The Valspar Corporation (a subsidiary of Sherwin-Williams) is exploring both mechanical and chemical recycling routes. Their 2025 initiatives include partnerships with local foam manufacturers to pilot closed-loop recycling streams for flexible foams, leveraging their existing coatings and materials expertise to ensure recycled polyols meet regulatory and quality standards.

Meanwhile, Huntsman Corporation has introduced recycled polyol technologies suitable for flexible slabstock foam, launching commercial products under its Terol brand. In 2025, Huntsman is scaling up production in Europe and North America, supported by collaborations with bedding and automotive sector partners to validate performance and life cycle benefits.

The outlook for the next few years indicates intensified collaboration across the value chain, with industry players forming consortia and supply partnerships to secure consistent feedstock and optimize recycling economics. With increasing regulatory mandates such as EU’s Circular Economy Action Plan and consumer expectations for sustainable materials, polyol recovery technologies are poised to become integral to the global PU industry. The pace of commercialization is expected to accelerate as pilot projects transition to full-scale operations and industry standards for recycled polyol quality are established.

Regulatory Landscape: Global Policies and Compliance Outlook

The regulatory landscape for polyol-based polyurethane foam recycling technologies is rapidly evolving as governments and industry bodies intensify efforts to address environmental concerns associated with polyurethane (PU) waste. In 2025, the European Union remains at the forefront with its Circular Economy Action Plan and the Waste Framework Directive, both of which directly influence the management and recycling of PU foams. The EU’s Green Deal mandates higher recycling targets and stricter controls on landfilling plastic waste, compelling manufacturers to incorporate recycled polyols and invest in advanced recycling technologies (EUROFOAM). The upcoming revision of the EU’s End-of-Life Vehicles Directive is expected to further incentivize the recycling of PU foams used in automotive applications by setting minimum recycled content requirements.

In North America, the U.S. Environmental Protection Agency (EPA) is expanding its Sustainable Materials Management program, with a specific focus on the recovery and reuse of urethane-based materials. State-level policies, particularly in California, are accelerating the adoption of chemical recycling methods—such as glycolysis and hydrolysis—by offering grants and tax credits to companies developing innovative polyol recovery systems (Huntsman Corporation). Canada is similarly advancing Extended Producer Responsibility (EPR) regulations, which will soon require manufacturers and importers of PU foams to ensure end-of-life collection and recycling compliance.

In Asia, China’s Ministry of Ecology and Environment is implementing new standards for plastic waste recycling, with a focus on resource efficiency and pollution reduction. This is prompting major PU producers to adopt closed-loop recycling strategies for polyol-based foams (Bayer AG). Japan, through its Act on the Promotion of Effective Utilization of Resources, is incentivizing the use of recycled polyols in building insulation and automotive sectors, backed by industry collaboration with global suppliers.

Looking ahead, compliance with evolving regulations will necessitate significant investment in recycling infrastructure and traceability systems. Companies are already responding by developing certified recycled polyols and digital platforms for tracking recycled content, as seen in recent initiatives by Covestro AG and BASF SE. By 2027, industry analysts expect harmonized standards on recycled content and eco-design to be introduced across major markets, further supporting the adoption of polyol-based PU foam recycling technologies and creating a robust global compliance framework.

End-Use Applications: Construction, Automotive, Furniture, and Beyond

Polyol-based polyurethane (PU) foam recycling technologies are experiencing significant advancements, with notable implications for end-use sectors such as construction, automotive, furniture, and emerging markets. As of 2025, mechanical, chemical, and emerging enzymatic recycling processes are being actively scaled and optimized to address both environmental and economic demands.

In the construction sector, recycled polyols from PU foams are increasingly incorporated into building insulation products, contributing to the circularity of materials used for thermal management and energy efficiency. Companies like Covestro have developed chemical recycling technologies such as hydrolysis and glycolysis to recover high-quality polyols, which are then reintroduced into rigid foam formulations for insulation panels, reducing both raw material consumption and carbon footprint. The deployment of these recycled materials aligns with evolving regulatory frameworks in the EU and North America, where green building certifications demand demonstrable recycled content.

In the automotive industry, the use of recycled polyol-based PU foams is accelerating, particularly for interior applications such as seats, headrests, and acoustic dampening. BASF is piloting chemical recycling methods that enable the recovery and purification of polyols from post-consumer automotive foams. These recycled polyols are then utilized in the production of new automotive components, supporting OEMs in meeting stringent recycling targets and lifecycle assessment requirements. The outlook for 2025 and beyond indicates a growing trend toward closed-loop systems, in which automotive manufacturers collaborate directly with recyclers to ensure traceability and quality of recycled materials.

  • Furniture: The furniture sector is adopting mechanically and chemically recycled PU foams for mattresses, cushions, and upholstered products. Manufacturers such as Huntsman have launched demonstration plants in Europe to showcase the feasibility of large-scale PU foam recycling and the reintegration of recycled polyols into comfort foam applications.
  • Beyond Traditional Markets: New applications are emerging in packaging, footwear, and even specialty coatings, as advanced recycling technologies improve the purity and performance of recovered polyols. Companies are investing in R&D to tailor recycled polyols for specific performance requirements, opening new commercial opportunities.

Looking ahead, the sector anticipates increased commercialization of polyol-based PU foam recycling processes, driven by policy incentives, corporate sustainability commitments, and growing demand for circular materials. Collaboration across the value chain—from foam producers and recyclers to end-users in construction, automotive, and furniture—will be essential for scaling these technologies and realizing their full potential by the late 2020s.

Sustainability Impact: Carbon Footprint and Lifecycle Assessments

Polyol-based polyurethane (PU) foam recycling technologies are gaining momentum as the industry intensifies efforts to reduce carbon emissions and improve the lifecycle sustainability of PU materials. As of 2025, several global manufacturers and consortia are actively integrating advanced recycling methods—including both mechanical and chemical recycling—into their sustainability strategies, with a focus on lowering the overall carbon footprint of PU foam products.

Lifecycle assessments (LCAs) conducted by industry leaders consistently show that recycling PU foams, particularly through chemical recycling processes that recover polyols, can result in significant reductions in greenhouse gas (GHG) emissions compared to virgin production. For instance, Covestro has reported that its chemical recycling technology for flexible PU foams can cut carbon emissions by up to 60% versus conventional production methods. This reduction is attributed to the substitution of fossil-based feedstocks with recycled polyols, which not only diverts waste from landfills but also reduces reliance on finite resources.

The year 2025 marks a period of broadening industrial collaborations and pilot-scale implementations. BASF has been scaling up its “chemical recycling of mattress foams” initiative, demonstrating closed-loop recycling by processing post-consumer mattresses and reintroducing the recovered polyols into new foam production. Early LCAs from this initiative indicate a substantial decrease in the environmental footprint of mattresses, especially in terms of lower GHG emissions and resource use.

Moreover, the European Diisocyanate & Polyol Producers Association (ISOPA) is actively supporting standardization of LCA methodologies for PU foam recycling, aiming for transparent and comparable sustainability metrics across the sector. Their ongoing projects are focused on harmonizing data collection and reporting, which is essential as regulatory frameworks such as the European Green Deal drive the adoption of circular economy practices.

Looking ahead to the next few years, the sustainability impact of polyol-based PU foam recycling is expected to grow as more facilities transition from pilot to commercial scale. Recticel, a major foam manufacturer, is investing in pilot plants for polyol recovery and is collaborating with the automotive and bedding industries to establish closed-loop recycling chains. Industry outlooks suggest that by 2027, a significant portion of flexible PU foam production in Europe and North America may incorporate recycled polyols, further reducing sector-wide emissions and supporting corporate carbon neutrality goals.

In summary, polyol-based PU foam recycling technologies are delivering measurable sustainability benefits in 2025, with major industry players driving innovation and standardization. Continued investment in chemical recycling and LCA harmonization are poised to further enhance the climate performance of polyurethane products in the near future.

Investment and Partnership Landscape: Recent Deals and Funding

The polyol-based polyurethane (PU) foam recycling sector is experiencing a surge in investment, partnerships, and strategic collaborations as global demand for sustainable materials intensifies. In 2025, the industry is witnessing the convergence of established chemical manufacturers, technology startups, and end-user brands, all vying to commercialize and scale advanced polyol recovery and foam-to-foam recycling solutions.

In early 2025, Covestro announced a multi-million euro investment to expand its “Evocycle® CQ” technology, a proprietary chemical recycling process that depolymerizes polyurethane foam waste back into high-quality polyols. This follows Covestro’s 2024 partnership with mattress manufacturer IKEA to demonstrate closed-loop recycling of flexible foam in bedding applications, with pilot plants in Germany and plans for broader commercial rollout.

Similarly, BASF has intensified its collaboration with The Vita Group, a leading converter of PU foams, scaling up their “smartcycle®” process which enables the production of recycled-content polyols for use in flexible foam products. In March 2025, BASF confirmed additional investment in its Antwerp site, targeting an increase in recycled polyol capacity to supply automotive and furniture markets.

Startups have also attracted significant funding in this space. Recycle Technologies, a UK-based innovator in solvent-based PU foam recycling, secured a Series B round in February 2025 led by strategic investors from the construction and packaging sectors, aiming to build a demonstration plant capable of processing 10,000 tons annually. Meanwhile, Repsol has partnered with several Spanish furniture manufacturers to co-develop and test new polyol formulations derived from post-consumer foam waste, supported by a grant from the European Union’s Horizon Europe program.

These investments reflect growing interest from downstream users, especially in the bedding, automotive, and building insulation sectors, who are increasingly demanding recycled-content materials to meet regulatory and consumer expectations. The European Green Deal and pending Extended Producer Responsibility (EPR) schemes across the EU are anticipated to further accelerate deal activity and public-private partnerships in the next few years.

Looking ahead, industry observers expect both consolidation and new entrants, as technology validation, feedstock security, and end-market acceptance become central to commercial success. With global PU foam production exceeding 20 million tons per year, the sector is poised for rapid scaling of polyol-based recycling technologies, supported by sustained investment and collaboration across the value chain.

Future Outlook: Opportunities and Challenges Through 2030

Looking ahead to 2030, the landscape of polyol-based polyurethane (PU) foam recycling technologies is characterized by both transformative opportunities and significant challenges. The growing urgency to address end-of-life PU waste, driven by regulatory pressures and sustainability commitments, is fueling innovation across mechanical, chemical, and novel recycling methods.

In 2025, leading chemical companies are scaling up the deployment of advanced recycling processes. Covestro has operationalized its first dedicated plant for chemical recycling of flexible PU foam in Germany, utilizing its proprietary process to recover high-purity polyols for new foam production. The company projects a significant increase in output capacity through 2027, with plans to license its technology globally. Similarly, BASF is advancing its ChemCycling™ initiative, integrating post-consumer PU foam waste into their chemical recycling streams, targeting commercial-scale applications by 2026.

Mechanical recycling, though well-established for rigid PU applications, faces challenges with flexible foams due to contamination and performance degradation. However, ongoing pilot projects by Huntsman Corporation and others are demonstrating improved regrinding and rebonding techniques for flexible foams, which could see broader adoption as technologies mature and secondary markets expand.

A notable trend is the emergence of hybrid and novel recycling pathways. Companies such as Repsol are exploring glycolysis and enzymatic depolymerization methods. These approaches promise higher yields of recycled polyols with reduced energy input, though full commercialization is anticipated post-2027 as technical and economic hurdles are addressed.

Despite these advances, challenges persist. The heterogeneity of PU waste streams, collection logistics, and the need for consistent quality in recycled polyols are ongoing barriers. Regulatory developments—such as increased Extended Producer Responsibility (EPR) in the EU and proposed eco-modulation of fees—are expected to influence both technology adoption and investment decisions through 2030.

Overall, the next five years are likely to see a shift from pilot-scale demonstrations to integrated commercial operations for polyol-based PU foam recycling. Companies actively collaborating across the value chain and investing in scalable, circular solutions are poised to capitalize on both environmental and market opportunities as the industry transitions toward a more sustainable future.

Sources & References