Propylene oxide is an important organic chemical used as an intermediate in the production of polyether polyols, which are used to manufacture polyurethane foams. It is commonly used in products such as furniture upholstery, insulation for pipes, buildings and vehicles, bedding, carpet underlay, children's items, packaging, and more.
The global propylene oxide market is estimated to be valued at US$ 16,852.2 Mn or Mn in 2023 and is expected to exhibit a CAGR of 5.8% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Dynamics:
The global propylene oxide market is witnessing substantial growth owing to the rising demand for polyether polyols from various industries such as construction, automotive, and furniture. According to statistics published by American Chemistry Council, the production of polyurethane foam in North America increased from 9.4 million tons in 2016 to 9.8 million tons in 2019, growing at a CAGR of 1.2% during the period. Moreover, propylene oxide is also used in other applications such as solvents, chemical intermediates, and hydrophilic polyether polyols. Expansion of end-use industries globally is expected to fuel the demand for propylene oxide during the forecast period. However, the availability of substitutes such as propylene glycol may hamper market growth over the forecast period.
SWOT Analysis
Strength: Propylene oxide is used for producing various industrial and consumer goods with three leading end-use industries being construction chemicals, automotive, and textiles. It is a versatile chemical having good reactivity and water solubility allowing its wide application. Production of propylene oxide from propylene is relatively easier and more economical than other production processes.
Weakness: Propylene oxide is highly flammable in nature bringing safety concerns during production, handling, transportation and storage. Stringent regulations over exhaust emissions and disposal of hazardous by-products increase production costs. Dependence on crude oil prices for obtaining raw materials represents a threat.
Opportunity: Rising construction activities and improving lifestyle in developing Asian countries increase demand for construction chemicals, rigid foams for insulation and polyurethanes for fibers and textiles offering huge growth opportunities. New applications in pharmaceuticals and agrochemicals further support market expansion.
Threats: Volatility in crude oil prices directly impact raw material costs. Growing environmental regulations over emissions and hazardous chemicals disposal require investments in pollution control technologies raising compliance costs. Alternatives like glycol ethers possess lower toxicity and replace propylene oxide in some end-use industries.
Key Takeaways
The global Propylene Oxide Market is estimated to be valued at US$ 16,852.2 Mn in 2023 and is expected to exhibit a CAGR of 5.8% over the forecast period 2023 to 2030
The global propylene oxide market is expected to witness high growth on account of rising polyurethane demand driven by construction and automotive industries in Asia Pacific region. The Asia Pacific currently dominates the global market with a share of over 50% owing to thriving construction and automotive industries along with improving economic conditions. China represents the largest consumer as well as producer of propylene oxide globally accounting for over 25% of the global demand in 2023 primarily due to huge manufacturing activities.
Key players operating in the propylene oxide market are Lyondellbasell Industries (Netherlands), Shell plc (United Kingdom), BASF SE (Germany), Evonik Industries (Germany), Dow Chemical Company (United States), Huntsman Corporation (United States), Repsol S.A. (Spain), Asahi Glass Co. Ltd. (Japan), Sumitomo Chemical Company (United Kingdom), INEOS Group (Japan), and Balchem Corporation (United States). The global market is moderately consolidated in nature with top five players accounting for over 50% of the global production capacity.
