Propylene Market Size, Share & Industry Analysis, By Derivative (Polypropylene, Propylene Oxide, Acrylonitrile, Acrylic Acid, Cumene, and Others), By Application (Packaging, Automotive, Construction, Consumer Goods, Electrical & Electronics, and Others), and Regional Forecast, 2024-2032

The global propylene market size was valued at USD 121.34 billion in 2023 and is projected to grow from USD 127.85 billion in 2024 to USD 194.62 billion by 2032 at a CAGR of 5.4% during the forecast period. Asia Pacific dominated the propylene market with a market share of 62.86% in 2023.

Propylene, also known as propene, is a colorless, flammable gas produced through petroleum refining and natural gas processing. It is an important building element in the manufacturing of many chemical compounds, such as Polypropylene (PP) plastics, propylene oxide (used to make polyurethane plastics), acrylonitrile, and others. The product is widely used in industries such as automotive, construction, and packaging due to its adaptability and importance in the manufacturing of a wide range of commonly utilized goods.

The COVID-19 pandemic had a mixed impact on the market. The demand for plastics tanked due to less manufacturing activity. However, the product remained essential for medical supplies. This caused a temporary price dip. However, the market is expected to recover with the revival of global product demand.

Propylene Market Trends

Shale Gas Bounty and Energy-Efficient Tech Unlock New Horizons for the Market

The energy sector is creating new potential opportunities for market players in a couple of key ways. The abundance of natural gas in the U.S. makes production cost-effective. Traditionally, it was produced through crude oil refining. However, shale gas provides a more cost-effective alternative, potentially affecting global production costs and increasing its availability for manufacturers and consumers.

Improvements in energy-efficient technologies such as Propane Dehydrogenation (PDH) are paving the way for a sustainable production process. PDH uses propane, another plentiful natural gas liquid, as its raw material. This reduces the reliance on crude oil and also decreases overall energy usage during synthesis. As the energy sector strives for greener technology, advances in PDH can lead to a more sustainable and perhaps cheaper supply chain, further bolstering the market.

Overall, the energy sector’s emphasis on easily available, energy-efficient resources benefits both producers and consumers. This collaboration amongst sectors opens the door to a more stable and potentially larger market over the forecast period.

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Propylene Market Growth Factors

Rising Demand for Lightweight and Sustainable Packaging Solutions to Boost Product Adoption

The packaging industry is a primary driver of propylene market growth. Several factors contribute to this influence. One major driver is the growing demand for flexible packaging solutions. Pouches, bags, and films made of polypropylene are popular as they are lightweight, convenient, and less expensive than traditional materials. These properties are especially appealing in the food and beverage industries, where companies are continuously looking for ways to increase shelf life and save transportation costs.

The increased emphasis on sustainability presents opportunities for the market within packaging. Advances in recycling technologies make it easier to recover and utilize PP from packaging waste. This emphasis on a circular economy generates consistent demand while addressing environmental concerns. As the packaging sector explores solutions that strike a balance between functionality and sustainability, the product remains a well-positioned material.

RESTRAINING FACTORS

Volatility in Feedstock Prices and Regulatory Hurdles May Constrain Market Growth

The market is constrained by the price volatility in feedstock, particularly crude oil and Natural Gas Liquids (NGLs). The production is heavily reliant on petroleum refining and hydrocarbon steam cracking, making it very sensitive to fluctuations in crude oil prices. The shift to lighter feedstock and increased usage of shale gas for ethylene production reduces yields, exacerbating supply constraints.

Regulatory challenges related to environmental concerns and sustainability goals also impede industry expansion. Stringent regulation necessitates investments in cleaner technologies and renewable feedstock, increasing production costs and operational complexities. Balancing regulatory compliance with economic viability presents a challenge for manufacturers, influencing investment decisions and market dynamics.

Propylene Market Segmentation Analysis

By Derivative Analysis

Polypropylene Led the Market due to High Demand from Packaging, Construction, and Automotive Industries

Based on derivative, the market is segmented into polypropylene, propylene oxide, acrylonitrile, acrylic acid, cumene, and others.

The polypropylene segment accounted for the largest propylene market share in 2023 due to its lightweight nature, durability, and versatility. This makes it ideal for applications in packaging, textiles, automotive parts, building and construction materials, and consumer goods. The rising demand from these industries is propelling the segment growth.

Propylene oxide is the fastest growing segment in the market. It is another major derivative used in the production of polyurethane foams, polyether, and various industrial chemicals. The growth in the construction and automotive sectors, which utilize polyurethane foams extensively, drives the segment growth.

Acrylonitrile finds application in the production of acrylic fibers, which are used in textiles and carpets. Additionally, it is a key component in the manufacturing of Acrylonitrile Butadiene Styrene (ABS), a widely used engineering plastic.

Acrylic acid is used in the production of superabsorbent polymers for diapers and adult incontinence products. The growing emphasis on hygiene and an aging population are contributing to a steady rise in the segment share.

Cumene is primarily used to produce phenol and acetone. Phenol is a key raw material for various resins and plastics, while acetone has applications in solvent and pharmaceutical industries. The demand for these downstream products is influencing the segment growth.

By Application Analysis

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Packaging Segment Led the Market Due to Increasing Flexible Packaging Demand

Based on application, the market is segmented into packaging, automotive, construction, consumer goods, electrical & electronics, and others.

In terms of application, the packaging segment held the largest share of the global market. Its lightweight nature, strength, and cost-effectiveness make it ideal for producing flexible packaging solutions such as pouches, films, and bags. The rising demand for convenience foods and beverages, coupled with the growing emphasis on lightweight materials for transportation efficiency, is driving the growth of the packaging segment.

Similarly, the automotive industry extensively employs derivatives in components such as bumpers and interior trim, benefiting from their lightweight properties and durability. The automotive segment is the fastest growing segment with a significant market share.

In the construction sector, it finds applications in pipes, insulating, and roofing membranes, owing to its strength and chemical resistance, supporting infrastructure development.

Consumer goods manufacturing utilizes propylene for an array of products, including toys, household appliances, and personal care items, capitalizing on its versatility and affordability.

Moreover, the electrical and electronics industry relies on various derivatives for insulation materials, packaging, and electronic components due to their electrical properties and flame-retardant characteristics.

REGIONAL INSIGHTS

Geographically, the market is studied across North America, Europe, Asia Pacific, Latin America, and the Middle East & Africa.

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The market size of Asia Pacific stood at USD 76.28 billion in 2023. The region held a dominant market share in 2023 and is projected to maintain its prominent position throughout the upcoming years. The growing middle class, increasing disposable income, and growing population in the region have all contributed to the product demand from the automotive, packaging, electronics, and construction industries. Additionally, significant investments in petrochemical infrastructure and capacity expansion have further bolstered the market’s growth trajectory in the region. China is the leading country in Asia Pacific owing to wide industrial activities and high demand for packaging in the country.

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North America has grown steadily owing to factors such as strong industrial infrastructure, technical improvement, and rising demand across a wide range of end-user sectors, including automotive, packaging, and construction. The region’s vast shale gas reserves offer cost-effective feedstock availability, contributing to the market competition.

Europe has grown moderately, owing to economic conditions, regulatory framework, and changing customer preference for environmentally friendly products. Despite hurdles such as strict environmental regulations and competition from other countries, technical innovation and R&D investment have moved the market forward, notably in industries such as automotive, manufacturing, and polymer production.

The market in Latin America has grown significantly, owing to improved economic conditions, infrastructure development, and investment in industries such as automotive, construction, and packaging. The Middle East & Africa has emerged as major participants in the market due to extensive hydrocarbon resources and advantageous geographical locations. Saudi Arabia, Qatar, and the UAE have invested extensively in petrochemical infrastructure, resulting in significant expansion of production capacities and exports of propene and its derivatives.

List of Key Companies in Propylene Market

Capacity Expansions and Developing Bio-Based Alternatives are the Key Strategic Initiatives Adopted by Companies

Major players such as ExxonMobil, Shell, and BASF are actively expanding their market presence through capacity expansion in North America and Asia. They are also undertaking strategic acquisitions to solidify their feedstock advantage, and investment in propylene production technologies. Additionally, they are developing bio-based product alternatives and forging partnerships with automotive companies to develop lightweight car parts.

LIST OF KEY COMPANIES PROFILED:

• China Petrochemical Corporation. (China)


• LyondellBasell Industries Holdings B.V. (U.S)


• Braskem (Brazil)


• PetroChina Company Limited (China)


• SABIC (Saudi Arabia)


• BASF SE (Germany)


• Reliance Industries Limited. (India)


• Mitsui Chemicals, Inc. (Japan)


• Exxon Mobil Corporation (U.S.)


• Shell plc (U.K.)

KEY INDUSTRY DEVELOPMENTS:

• March 2024: Shell Chemicals started the supply of bio-circular and bio-attributed propylene feedstock to Braskem. The supply of such feedstock would enable Braskem to offer more sustainable solutions to cater to the increasing consumer demand from industries such as film, packaging, consumer goods, and automotive.


• January 2024: LyondellBasell announced a deal to acquire a 35% stake in Saudi Arabia’s National Petrochemical Industrial Company (NATPET) for over USD 500 million. The joint venture, facilitated by its spheripol Polypropylene (PP) technology, positioned LYB to grow and enhance its core PP business by providing access to advantageous feedstock and increasing product marketing capacity in a critical region.


• October 2022: Braskem formed a joint venture with Japanese supplier Sojitz to manufacture bioMPG (monopropylene glycol) for a range of applications and bioMEG (monoethylene glycol) for PET. This step indicates Braskem’s commitment toward a low carbon circular economy.

REPORT COVERAGE

An Infographic Representation of Propylene Market

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The research report provides a comprehensive market analysis and emphasizes crucial aspects such as leading companies, derivatives, and applications. Furthermore, it provides quantitative data regarding volume and value, market analysis, research methodology for market data, insights into market trends, and highlights vital industry developments and competitive landscape. In addition to the abovementioned factors, the report encompasses various factors contributing to the market’s growth in recent years.

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