Global Propylene Oxide Market Size Likely to Surpass at a CAGR of 5.24% By 2034

Market Size and Growth

As per the Propylene Oxide Market size conducted by the CMI Team, the global Propylene Oxide Market is expected to record a CAGR of 5.24% from 2025 to 2034. In 2025, the market size is projected to reach a valuation of USD 20.25 Billion. By 2034, the valuation is anticipated to reach USD 32.07 Billion.

Overview

According to market analysts at CMI, the PO market has its growth driven largely due to its importance in polyurethane production and wider industrial needs being generated in parallel with applications. On the one hand, construction, automotive, and other sectors being on an upswing create demand for lightweight and protective materials, adversely affecting PO’s relevance. On the other hand, there is renewed consciousness on sustainability and pollution control, which is putting more focus on clean technologies, HPPO being one among them.

Key Trends & Drivers

• Growth of Production Technologies: Advanced development in manufacturing technologies, chiefly in chlorohydrin and propylene oxidation methods, has been propelling the propylene oxide (PO) market. Old methods, such as the chlorohydrin route, do lead to some toxic wastes; however, in the recent past, there have been various process-related advancements for safety in operating conditions, performance of catalysts, and energy efficiencies. One of the breakthroughs is the HPPO (hydrogen peroxide to propylene oxide) process, in which propylene is cleanly converted with hydrogen peroxide, and water is the only by-product. This reduces the environmental footprint while also cutting operational expenses and keeping plant infrastructure simple. As a result, many producers across the globe are shifting toward HPPO in their new or upgraded units, and this is shaping the future growth of propylene oxide in an industrial landscape that is slowly drifting towards sustainability.

• Rising Demand for Polyurethane-Based Solutions: The Main factor driving propylene oxide demand is the growing use of polyurethane (PU) foams. PO is the raw material used in producing polyether polyols, which are further used in the production of rigid and flexible polyurethane foams. The rigid and flexible polyurethane foams are widely used in construction, furniture-making, packaging, refrigeration, and automotive interior industries. Rigid PU foams are very much valued for their insulating thermal property and thus are very crucial for applications like energy-efficient buildings and appliances. Flexible PU foams provide comfort to applications such as bedding, furniture, and car seats. On the other hand, PO-derived materials will continue growing steadily in demand, amplified by consumer expectations for energy savings, durability, and comfort, especially in many developing nations with fast-paced urbanization. The growing application of polyurethanes and the growing need for sustainability only further bolster PO in the value chain.

• Advancements in the Automotive & Construction Sector: The automotive and construction industries are increasingly depending on some advanced materials made out of propylene oxide derivatives. In the automotive industry, strict fuel efficiency and emission standards are enforced to popularize lightweight materials such as polyurethane foams and composites, which reduce the overall weight of vehicles without any compromise on safety or performance. The increased use of electric vehicles (EVs) is also benefiting new applications for PO-based materials for thermal management and acoustic insulation. In construction, the enhanced building codes have put a higher focus on insulation materials such as rigid polyurethane foams. Other than foams, PO is also a feedstock for surfactants, glycol ethers, and deicing fluids utilized at industrial, commercial, and municipal levels. This diversification across the two largest global sectors supports market resiliency and opens new avenues for growth for PO producers.

• Environmental & Regulatory Emphasis: Environmental considerations and regulatory developments are changing the dynamics of the PO market. The traditional chlorohydrin process, from an environmental standpoint, presents problems: large quantities of wastewater are produced, and hazardous by-products such as calcium chloride are generated. Since then, regions from the developed world have enhanced environmental regulations and are now incentivizing green tech adoption. The HPPO version with higher yields and lower waste and water and energy use is fast catching up as the favored alternative. Regulatory frameworks like the EU’s REACH and the U.S.’s Toxic Substances Control Act (TSCA) accelerated pushes for all manufacturers to upgrade production facilities to safer handling of chemicals. Even though these regulatory changes offer cost and compliance challenges to certain players, they present huge opportunities for the players who are willing to invest in sustainable and efficient technologies for PO production, hence supporting long-term viability for the industry.

Report Scope

SWOT Analysis

• Strengths: The versatility of propylene oxide (PO) and its applications in different end-user sectors, such as automotive, construction, packaging, and personal care, act as important demand drivers. PO is an intermediate that is used for making polyether polyols and propylene glycol and glycol ethers, which find applications in the manufacture of polyurethane foams, deicing fluids, and solvents, respectively. Such diversified applications keep the demand for propylene oxide in place. The market benefits further with advances in technology, especially with the advent of the HPPO (hydrogen peroxide to propylene oxide) process, as this makes the process efficient and socially acceptable. Large producers like Dow, LyondellBasell, and Shell, undertaking highly vertically integrated operations, allow the producers greater control over feedstock supply, product development, and marketing.

• Weaknesses: In spite of its strengths, the PO market is faced with various weaknesses. The manufacturing of propylene oxide by conventional methods, such as chlorohydrin, involves hazardous chemicals and creates a lot of waste, which translates into high environmental compliance costs associated with the process. These methods are increasingly coming under strong environmental regulations and, hence, could increase the operating cost or force the plant to shut down. Secondly, it is a capital-intensive market that requires huge capital investment in building plant facilities and upgrading to the latest technology. Hence, smaller firms have tough competition from larger integrated players due to entry barriers, complex technology, and being highly dependent on the price fluctuations of raw materials from petroleum.

• Opportunities: The market proposes several options for growth, in particular, the development of green technologies and the increased use of such technologies, with the HPPO process gaining ground due to being environmentally friendly and lowering operational costs. Further, the growth of downstream sectors in construction, automotive, and personal care, especially within the emerging markets, opens new channels for the penetration of this market. A rising preference for lightweight materials and efficient insulation products would stimulate gains in polyurethane applications and, thus, put pressure on PO consumption. There are also opportunities in specialty chemicals and derivatives, including high-purity glycols and surfactants for use in cosmetics and pharmaceuticals, with better profits and niche segments for growth.

• Threats: Several external threats can put the growth trajectory of the PO market at risk. Increasing environmental regulations, especially in the developed economies, are a threat to the older production units, which may not meet the standards for emission and waste management of the new times. Non-compliance can attract fines, closure of plants, or forced investment in retrofits. Moreover, fluctuations in the prices of crude oil and natural gas, impacting the cost of propylene (being the major feedstock), pose risks to the market. Rising competition from alternative materials and green chemistry processes that are likely to replace a few of the PO-derived products also threatens the market. Public and regulatory opposition to petrochemical-based products could further curtail market expansion, especially in markets that are mindful of the environment.

List of the prominent players in the Propylene Oxide Market:

• Dow
• LyondellBasell
• BASF
• Shell
• Huntsman Corporation
• SKC Co. Ltd.
• AGC Inc.
• Sumitomo Chemical Co. Ltd.
• Repsol
• Tokuyama Corporation
• China Petrochemical Corporation (Sinopec)
• China National Petroleum Corporation (CNPC)
• Manali Petrochemicals Limited
• Kumho P&B Chemicals
• Zibo Qixiang Tengda Chemical Co. Ltd.
• Jiangsu Shuangliang Eco-Energy Systems Co. Ltd.
• DowDuPont
• INEOS Oxide
• Eastman Chemical Company
• SABIC
• Others

The Propylene Oxide Market is segmented as follows:

By Production Method

• Propylene Oxidation
• Chlorohydrin Process

By Application

• Polyether Polyols
• Propylene Glycol
• Glycol Ethers
• Specialty Surfactants
• Others

By End User

• Automotive
• Construction
• Packaging
• Furniture and Bedding
• Electronics
• Pharmaceuticals
• Personal Care
• Others

Regional Coverage:

North America

• U.S.
• Canada
• Mexico
• Rest of North America

Europe

• Germany
• France
• U.K.
• Russia
• Italy
• Spain
• Netherlands
• Rest of Europe

Asia Pacific

• China
• Japan
• India
• New Zealand
• Australia
• South Korea
• Taiwan
• Rest of Asia Pacific

The Middle East & Africa

• Saudi Arabia
• UAE
• Egypt
• Kuwait
• South Africa
• Rest of the Middle East & Africa

Latin America

• Brazil
• Argentina
• Rest of Latin America