The carbon fiber market was valued at USD 2589.46 million in 2020, and the market is projected to register a CAGR of 5.9% during the forecast period (2021-2026). The major factors driving the growth of the market are accelerating usage in the aerospace and defense sector and increasing application in the wind energy sector. On the flip side, the high prices of carbon fiber have been acting as a roadblock to the growth of the market. The increasing popularity of recycled carbon fiber is likely to act as an opportunity for the market studied over the forecast period. In terms of volume and value, Asia-Pacific dominated the market across the world, with China accounting for most of the demand.

Polyacrylonitrile (PAN) is the most versatile precursor for carbon fiber, accounting for almost 90% of carbon fiber production. PAN-based carbon fibers have good mechanical properties and are preferred in major applications, owing to high carbon yield, potential of polymer to undergo cyclization reactions, and lowest fraction of voids, resulting in higher strength and stability, along with the flexibility to tailor the structure of the final product. The demand for PAN carbon fiber is expected to rise during the forecast period.

China is the largest manufacturer of automobiles in the world, but the country's automotive sector has been impacted by the COVID-19 pandemic and the trade war with the United States. However, the country's aircraft parts and assembly manufacturing sector is growing rapidly, and China is expected to be the world's largest single-country market for civil aircraft sales over the next 20 years. The demand for electronic items is expected to rise gradually in the future as the middle-class population's disposable incomes rise, pushing the market studied.

The carbon fiber market is a consolidated market, where the top ten players account for more than 88% of the total global production capacity. The major companies in the carbon fiber market include Toray Industries Inc., SGL Carbon, Mitsubishi Chemical Corporation, Teijin Limited, and Hexcel Corporation