Throughout Q1 2025, the propylene oxide (PO) market in North America showed a mixed trend. In January, prices edged up slightly as feedstock propylene costs tightened and restocking activity resumed post-holidays, despite soft construction-related demand and logistical disruptions from winter weather along the Gulf Coast. February saw prices decline due to weakened downstream demand from polyurethane, polyether polyols, and coatings, along with continued slowdowns in housing construction and industrial activity.

Get the latest insights on price movement and trend analysis of Propylene Oxide in different regions across the world (Asia, Europe, North America, Latin America, and the Middle East Africa).

The propylene oxide prices in the United States for Q4 2023 reached 1305 USD/MT in December. The market was stable initially but fell as the quarter progressed due to lower feedstock propylene costs and weak energy prices. Additionally, despite subdued construction demand, commercial construction saw a rise in polyurethane procurement. Consumer spending remained robust, particularly in pharmaceuticals, driven by rising healthcare prices. Towards the quarter’s end, prices increased slightly due to higher shipping costs.

Propylene Oxide Prices December 2023

Explore IMARC’s newly published report, titled “Propylene Oxide Prices, Trend, Chart, Demand, Market Analysis, News, Historical and Forecast Data Report 2024 Edition,” offers an in-depth analysis of propylene oxide pricing, covering an analysis of global and regional market trends and the critical factors driving these price movements.

The global propylene oxide market size was over USD 22.24 billion in 2024 and is forecast to experience a CAGR of over 5.3%, reaching USD 43.52 billion by 2037. The chlorohydrin segment is projected to command the largest market share, fueled by its use in making dye intermediates, pesticides, and plasticizers.

Propylene oxide prices dropped 7–11% YoY in Q4 2024; prices are likely to stay low with gradual recovery expected in late 2025.

The global Propylene Oxide (PO) market demand stood at 10.1 million tonnes in 2024 and is expected to grow at a CAGR of 5.76% during the forecast period until 2035.

The Indian propylene oxide market soared to $51M in 2024, rising by 17% against the previous year. This figure reflects the total revenues of producers and importers (excluding logistics costs, retail marketing costs, and retailers' margins, which will be included in the final consumer price). In general, the total consumption indicated a resilient increase from 2012 to 2024: its value increased at an average annual rate of +7.9% over the last twelve-year period.

Propylene Oxide Market Outlook 2032

The global propylene oxide market size was USD 25.13 Billion in 2023 and is likely to reach USD 39.22 Billion by 2032, expanding at a CAGR of 5.6% during 2024–2032. The market growth is attributed to the high demand for polyurethane products across the globe.



Increasing demand for polyurethane products is driving the propylene oxide market. Propylene oxide is a volatile, colorless liquid that is crucial in the production of polyurethane plastics, which find extensive use in various industries such as automotive, construction, and furniture. The rise in the construction and automotive industries, coupled with the growing demand for lightweight and durable materials, is fueling the demand for polyurethane products, thereby boosting the market.

Impact of Artificial Intelligence (AI) in Propylene Oxide Market

The use of artificial intelligence is likely to boost the propylene oxide market. AI-powered predictive analytics forecast market trends, enabling businesses to make informed decisions about production and distribution. This technology predicts demand, helping to prevent overproduction and waste. Furthermore, AI optimizes the manufacturing process by monitoring and adjusting production parameters in real time, leading to improved product quality and reduced costs. AI's ability to analyze large volumes of data helps in identifying potential safety risks, thereby ensuring a safer working environment. Thus, the integration of AI is transforming the market, promising a future of increased efficiency, safety, and profitability.

Propylene Oxide Market Dynamics

Major Drivers

Growing emphasis on energy efficiency is projected to propel the market during the forecast period. Polyurethane foam, a primary application of th

Propylene Oxide For Industrial Market Outlook

The global propylene oxide market size was valued at approximately $20 billion in 2023 and is projected to reach $34 billion by 2032, growing at a CAGR of 6.2% during the forecast period. The remarkable growth of this market is driven primarily by the increasing demand from various end-use industries such as automotive, construction, and packaging.

One of the significant growth factors for the propylene oxide market is the escalating demand for polyurethane foams, which are extensively used in the automotive and construction industries. Polyurethane foams derived from polyether polyols, a major application segment of propylene oxide, offer superior insulation properties and structural strength, making them indispensable in building insulation and automotive seating. Additionally, the increasing focus on energy efficiency and green building initiatives further fuels the demand for polyurethane foams, thereby bolstering the propylene oxide market.

Another critical growth driver is the rising consumption of propylene glycol, a derivative of propylene oxide, in the pharmaceutical and food industries. Propylene glycol is widely used as a solvent in pharmaceutical formulations, food additives, and personal care products. The expanding pharmaceutical sector, driven by increased healthcare awareness and an aging population, significantly contributes to the growing demand for propylene glycol. Furthermore, the rising trend of convenience foods and beverages, along with stringent regulations on food safety, promotes the use of propylene glycol in the food industry.

The development of innovative production processes plays a substantial role in the market's growth. The shift towards more efficient and environmentally friendly production methods, such as the hydrogen peroxide process, enhances the overall production capacity and reduces environmental hazards associated with traditional methods like the chlorohydrin process. This technological advancement not only ensures a steady supply of propylene oxide but also aligns with the global trend towards sustainability and green chemistry, thus propelling the market forward.

Regionally, the Asia Pacific region is anticipated to witness the highest growth rate in the propylene oxide market during the forecast period. The rapid industrialization and urbanization in countries like China and India create significant demand for propylene oxide in construction, automotive, and packaging industries. Moreover, the presence of a large manufacturing base and continuous investments in infrastructure development further drive the regional market's expansion. The region's robust economic growth and favorable government policies also contribute to the accelerated adoption of propylene oxide, making Asia Pacific a pivotal market for future growth.

Application Analysis

The application segment of propylene oxide is diverse, encompassing polyether polyols, propylene glycol, glycol ethers, and others. Polyether polyols represent one of the most significant application segments due to their crucial role in the production of polyurethane foams. These foams are essential materials in automotive seating, building insulation, and various other industrial applications. The increasing demand for energy-efficient buildings and lightweight automotive components drives the consumption of polyether polyols, thereby stimulating the growth of the propylene oxide market. Additionally, advancements in foam technologies and the development of high-performance polyols further enhance their application scope.

Propylene glycol is another vital application segment, witnessing substantial demand from the pharmaceutical, food, and personal care industries. As a versatile chemical, propylene glycol serves as a solvent, humectant, and emulsifier in various formulations. The growing pharmaceutical industry, driven by increased healthcare spending and technological advancements in drug delivery systems, significantly boosts the demand for propylene glycol. Furthermore, the rising trend of convenience foods and beverages, coupled with strict food safety regulations, propels its use in the food and beverage sector. The personal care industry also contributes to the demand, with propylene glycol being a key ingredient in cosmetics and skin care products.

Glycol ethers, derived from propylene oxide, are utilized in a wide range of applications, including paints and coatings, cleaners, and chemical intermediates. The increasing demand for high-performance coatings in automotive

The North America Propylene Oxide Market would witness market growth of 5.2% CAGR during the forecast period (2024-2031). In the year 2020, the North America market's volume surged to 1,918.5 kilo tonnes, showcasing a growth of 20.4% (2020-2023). The chlorohydrin process is one of the primary metho

The upstream raw material propylene oxide price decreased throughout the second quarter in the North American region. The polypropylene Glycol price declined due to the region's reduced raw materials.

Get the latest insights on price movement and trend analysis of Propylene Glycol in different regions across the world (Asia, Europe, North America, Latin America, and the Middle East Africa).

Propylene Oxide Market Outlook

According to our latest research, the global propylene oxide market size reached USD 20.4 billion in 2024, with a robust compound annual growth rate (CAGR) of 5.7% expected over the forecast period. By 2033, the market is anticipated to attain a value of USD 33.1 billion, driven by rising demand in downstream industries and continuous innovation in production processes. The market’s growth is primarily fueled by the increasing consumption of polyether polyols in the polyurethane sector, expanding applications in automotive and construction, and the shift towards more sustainable and efficient production technologies.

One of the key growth factors for the propylene oxide market is the surging demand for polyurethane foams, which are extensively used in automotive, construction, and furniture industries. Polyurethane, derived from polyether polyols, offers outstanding insulation, cushioning, and durability properties, making it the material of choice for a wide array of applications. The rapid urbanization and infrastructural development, particularly in emerging economies, have further accelerated the consumption of polyurethane-based products. Additionally, the automotive sector’s focus on lightweight materials for fuel efficiency and emission reduction has bolstered the use of propylene oxide derivatives, thereby supporting market growth.

Another significant driver is the growing adoption of propylene glycol and glycol ethers, which are essential in the production of solvents, de-icing fluids, and pharmaceuticals. The healthcare industry, in particular, has witnessed an uptick in demand for propylene glycol, owing to its use as a carrier in oral, injectable, and topical drug formulations. Furthermore, the increasing utilization of glycol ethers as environmentally friendly solvents in paints, coatings, and cleaning agents aligns with the global trend towards sustainable chemistry. This shift is prompting manufacturers to invest in advanced production technologies, such as the hydrogen peroxide process, which offers higher efficiency and lower environmental impact compared to traditional methods.

The propylene oxide market is also benefiting from advancements in production processes, with a notable trend towards eco-friendly and cost-effective technologies. The hydrogen peroxide process, in particular, is gaining traction due to its minimal by-product generation and reduced environmental footprint. Companies are investing heavily in research and development to optimize yields, reduce energy consumption, and meet stringent regulatory standards. As sustainability becomes a central theme across industries, the adoption of green chemistry and circular economy principles is expected to reshape the competitive landscape, creating new opportunities for innovation and market expansion.

Regionally, Asia Pacific dominates the propylene oxide market, accounting for the largest share in 2024, followed by North America and Europe. The region’s leadership is attributed to the rapid industrialization, burgeoning construction activities, and the presence of major end-use industries. China and India, in particular, are witnessing exponential growth in demand for polyurethane foams and propylene glycol, supported by government initiatives and rising consumer spending. Meanwhile, North America and Europe continue to invest in process innovation and sustainable production, while emerging markets in Latin America and the Middle East are poised for steady growth, driven by expanding automotive and construction sectors.

Production Process Analysis

The production process segment is a critical determinant of the propylene oxide market’s cost structure, environmental impact, and overall competitiveness. The chlorohydrin process, historically the most widely adopted method, involves the reaction of propylene with chlorine and water, producing propylene oxide alongside significant quantities of waste, including calcium chloride. Despite its established infrastructure, this process faces scruti

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Propylene Oxide Market Size 2024-2028

The propylene oxide market size is forecast to increase by USD 6.24 billion at a CAGR of 4.72% between 2023 and 2028.

The market is experiencing significant growth due to the increasing demand for polyurethane, a primary application of propylene oxide. The global automotive industry's expansion is another key growth factor, as propylene oxide is extensively used in the production of automotive parts. However, environmental and regulatory concerns are posing challenges to the market's growth. 
Strict regulations regarding the emission of volatile organic compounds (VOCs) from paints and coatings and propylene oxide production are limiting its usage in certain applications. Additionally, the market is witnessing a shift towards the use of alternative chemicals due to their lower environmental impact. To mitigate these challenges, market participants are investing in research and development of eco-friendly production methods and alternative applications.

What will be the Size of the Propylene Oxide Market During the Forecast Period?

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The market is a significant segment of the global petrochemical industry, primarily used in the production of polyurethane foam and polyethers. PO is derived from propylene, a byproduct of refineries that process petroleum and natural gas. The manufacturing process of PO involves passing propylene through steam crackers, which results in the formation of PO through a series of chemical reactions. PO is a versatile chemical intermediate, with applications extending beyond foam production to include the synthesis of propylene glycols and polyether polyols. These materials are integral to the production of various polyurethane products, such as flexible and rigid foams, used in industries ranging from automotive to bedding and furniture.
The PO market dynamics are influenced by various factors, including raw material availability and prices, technological advancements, and regulatory frameworks. The competitive structure of the market is characterized by a few large players and numerous small and medium-sized enterprises. Qualitative and quantitative research methods are employed to analyze market trends and forecast future growth. PO is used In the production of a wide range of petrochemical products, including polyurethanes, which are essential components of jet fuel, gasoline, and diesel. Despite its importance, the PO market faces challenges, including increasing competition and the need for continuous innovation to meet evolving customer demands and regulatory requirements.

How is this Propylene Oxide Industry segmented and which is the largest segment?

The propylene oxide industry research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in 'USD billion' for the period 2024-2028, as well as historical data from 2018-2022 for the following segments.

Application

  Polyether polyols
  Propylene glycols
  Glycol ethers
  Others


End-user

  Automotive
  Building and construction
  Textile and furnishing
  Others


Geography

  APAC

    China
    India
    Japan


  North America

    US


  Europe

    Germany


  Middle East and Africa



  South America

By Application Insights

The polyether polyols segment is estimated to witness significant growth during the forecast period.

Propylene oxide (PO) is a crucial chemical intermediate used In the production of polyether polyols. These polyols, formed through the reaction of PO with polyfunctional alcohols, are integral to the creation of polyurethane foams. The construction industry relies heavily on these foams for insulation applications due to their thermal insulation properties and energy efficiency. With the emphasis on sustainability and reduced energy consumption, insulation materials have gained significance, propelling the demand for polyether polyols. Additionally, the automotive sector's focus on lightweight materials for fuel efficiency and sustainability will further boost the market for PO derivatives. Applications in advanced polymer manufacturing, adhesives, coatings, automobile cushioning, battery encapsulation, bedding, and various other industries contribute to the market's competitive structure.

Safety concerns and environmental considerations, including potential health effects such as eye and skin irritation, are under constant scrutiny, necessitating adherence to safety standards. The market for propylene oxide and its derivatives is expected to maintain a steady growth trajectory due to its versatile applications and the evolving industry landscape.

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The Polyether polyols segment was valued at USD 12.60 billion in 2018 and showed a gradual increase during the forecast period.

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Propylene Oxide Market accounted for USD 20.54 Billion in 2020 and is estimated to be USD 35.95 Billion by 2030 and is anticipated to register a CAGR of 5.80%.

According to Cognitive Market Research, the global Propylene Oxide market size will be USD 18.7 billion in 2024 and will expand at a compound annual growth rate (CAGR) of 5.0% from 2024 to 2031. Market Dynamics of Propylene Oxide Market

Key Drivers for Propylene Oxide Market

Expansion of the Personal Care and Pharmaceutical Industries - Propylene oxide is a critical ingredient in the production of various glycols, such as propylene glycol, which is widely used in personal care products and pharmaceuticals. The personal care industry benefits from the use of propylene glycol in products like lotions, shampoos, and deodorants due to its moisture-retaining properties. In the pharmaceutical industry, propylene glycol serves as a solvent in oral, injectable, and topical medications. The increasing consumer awareness regarding personal hygiene and healthcare, coupled with the rising global population and aging demographics, is propelling the growth of the personal care and pharmaceutical sectors.
The rising demand for polyether polyols in the manufacturing of flexible foams is anticipated to drive the Propylene Oxide market's expansion in the years ahead.

Key Restraints for Propylene Oxide Market

The hazardous nature of propylene oxide, posing health risks and environmental challenges, restricts its widespread use.
The market also faces significant difficulties related to volatile raw material prices.

Key Trends for Propylene Oxide Market

Shift Towards Sustainable Production Methods

There is a growing trend towards adopting more sustainable and bio-based production technologies for propylene oxide. Manufacturers are exploring alternative processes that reduce environmental impact and improve safety.

Technological Advancements in Production Processes

Innovations in production technologies, such as the development of more efficient catalysts and reaction processes, are enhancing the yield and cost-effectiveness of propylene oxide production.

Strategic Market Expansion and Partnerships

To mitigate overcapacity and market challenges, companies are forming strategic partnerships and expanding into emerging markets. This approach helps diversify their market presence and reduce dependency on saturated regions. Introduction of the Propylene Oxide Market

The Propylene Oxide Market is a dynamic sector driven by the increasing demand for this versatile chemical compound used in various applications. Propylene oxide, a key intermediate in the production of polyether polyols and propylene glycol, plays a crucial role in manufacturing polyurethane foams, antifreeze, and solvents. Its applications span across industries such as automotive, construction, and consumer goods. The market is buoyed by the growing automotive and construction sectors, which require propylene oxide-based products for durability and performance enhancements. Technological advancements in production processes, including more efficient and environmentally friendly methods, are also contributing to market growth. However, challenges such as volatile raw material prices and environmental regulations impact market dynamics. As industries continue to expand and innovate, the Propylene Oxide Market is expected to experience steady growth, driven by ongoing demand for high-performance materials and sustainable solutions.

Propylene oxide market was valued at USD 21,234 million and predicted to grow at 5.9% CAGR during the forecast period.

In the first quarter of 2025, Propylene Glycol prices in the USA showed a steady upward trend. Prices began increasing in late January, reflecting renewed purchasing activity and a more favorable demand outlook. This moderate rise continued throughout February and March as market participants adapted to stabilizing economic conditions and strong demand, particularly from the manufacturing and pharmaceutical sectors. While there were no significant spikes in demand, prices gradually increased, driven by consistent consumption patterns and a cautious approach to procurement.

Discover the latest trends in the propylene oxide market in China, as rising demand drives consumption upward for the next decade. Forecasts show a slight increase in market performance with an anticipated CAGR of +0.3% in volume and +2.1% in value from 2024 to 2035.

Propylene Oxide Market is expected to grow at a high CAGR during the forecast period 2024-2031 | DataM Intelligence