by The propylene oxide market manufactures propylene oxide, which is an important raw material used in making various products including polyurethane foam, solvents, and chemicals. Propylene oxide is a colorless volatile liquid that is miscible with alcohol, ether, and chloroform. It is an important chemical intermediate that is used to produce polyether polyols, which are precursors for polyurethane foam. The global demand for polyurethane is growing significantly due to its increasing use in industries such as construction, automotive, furniture, bedding, and carpets. Polyurethane provides insulation and acts as a cushioning material. The growing construction industry, particularly in Asia Pacific is driving the consumption of polyurethane foam for insulation in buildings.
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, as highlighted in a new report published by Coherent Market Insights.
Market Dynamics:
The propylene oxide market is expected to be flourished by the growing demand from polyurethane industry as mentioned in the heading. Polyurethane is majorly used in construction, automotive, and furniture industries due to its insulating and cushioning properties. The rapid growth of the global construction industry particularly in developing countries of Asia Pacific is one of the key drivers augmenting the demand for polyurethane foam, which in turn is propelling the growth of the propylene oxide market. According to global data, the construction industry is expected to grow at 5% annually during 2023-2030. The increase in residential and commercial construction projects signifies lucrative opportunities for propylene oxide manufacturers.
Another factor fueling the market growth includes rising automobile production across the globe. Polyurethane is extensively utilized in automobiles for manufacturing seats, dashboards, door panels, and bumpers due to its shock absorption and insulation abilities. According to International Organization of Motor Vehicle Manufacturers (OICA), globally over 95 million vehicles were produced in 2021 and this production is projected to grow annually at over 3% during the forecast period. Hence, increasing adoption of polyurethane in automobiles will further propel the propylene oxide market expansion over the forecast timeframe.
Segment Analysis
The global propylene oxide market is dominated by the polyether polyols sub-segment. It accounts for around 70% of the overall market share. Polyether polyols finds application in rigid and flexible foams which are used in furniture, bedding and automotive seating. Rising demand from these end-use industries is boosting the polyether polyols sub-segment growth. Propylene glycol is another major sub-segment which is witnessing growth due to its use in automotive coolants and aircraft deicing fluids.
PEST Analysis
- Political: Prices of raw materials for propylene oxide like propylene and chlorohydrin are impacted by global crude oil price fluctuations. Favorable government policies for insulation in construction industry are boosting demand.
- Economic: Growth of end-use industries like automotive, furniture and construction drives market demand. Emerging countries with improving economic conditions present new market opportunities.
- Social: Increasing consumer awareness about energy savings and environment protection fuels adoption of polyurethane foams made from propylene oxide in insulation applications.
Technological: Advancements in production technologies help increase capacity and reduce costs. Development of more energy efficient polyurethane formulations boosts their usage.Key Takeaways
The global propylene oxide market size was valued at US$ 16,852.2 Mn in 2023 and is expected to grow at a CAGR of 5.8% during the forecast period.
North America holds the largest market share currently due to strong demand from automotive and furniture industries in the region. The United States accounts for majority of demand in North America supported by high consumption of polyurethane foam and propylene glycol.
Asia Pacific is projected to witness fastest growth led by China, India and other developing nations on account of rapid industrialization and infrastructure development activities. Governmental focus on energy efficiency in buildings will augment polyurethane foam consumption.
Key players
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). Lyondellbasell Industries and Dow Chemical Company have established leading positions through expansion of production capacities and broad portfolio of derivatives.
