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North America Propylene Oxide Market Outlook, 2030

Published Aug 31, 2025
Length 88 Pages
SKU # BORM20367854

Description

The North American propylene oxide (PO) market is experiencing steady growth, primarily driven by demand from the automotive, construction, and consumer goods sectors within the region. A major share of PO consumption in North America is used in the production of polyether polyols, essential for manufacturing flexible and rigid polyurethane foams employed in automotive seating, insulation panels, and bedding products. The growth of the automotive industry, particularly with the rise of electric vehicles (EVs) in the U.S. and Canada, has heightened demand for lightweight, durable, and energy-efficient materials, indirectly boosting PO consumption. March 2025, Dow Inc. (USA) announced the successful commissioning of its new world-scale Propylene Oxide and Tertiary Butyl Alcohol (PO/TBA) plant in Texas, significantly boosting production capacity and reinforcing its leadership in cost-effective and integrated PO manufacturing. Simultaneously, the construction sector in North America is expanding, with increased investments in residential, commercial, and infrastructure projects, driving the need for insulation materials, coatings, and sealants derived from propylene oxide. Technological advancements in the region, including bio-based PO and cleaner production methods, are gaining traction as manufacturers align with North America’s stringent environmental and safety regulations. These regulations encourage the adoption of eco-friendly and low-emission chemicals, prompting companies to innovate and invest in more efficient manufacturing processes. Leading market players in North America are focusing on research and development to enhance product quality, reduce emissions, and improve cost-effectiveness. With continuous demand from key industries, ongoing technological innovations, and a supportive regulatory landscape, the North American propylene oxide market is expected to maintain steady growth in the coming years.

According to the research report ""North America Propylene Oxide Market Outlook, 2030,"" published by Bonafide Research, the North America Propylene Oxide market is expected to reach a market size of more than USD 7.19 Billion by 2030. The rising demand for polyether polyols, which are essential for producing flexible and rigid polyurethane foams, used in automotive seating, insulation materials, bedding, and packaging applications. The rapid expansion of the automotive sector, particularly with the increasing adoption of electric vehicles (EVs), has amplified the need for lightweight and energy-efficient materials, further boosting PO consumption. In parallel, growth in the construction industry, driven by substantial infrastructure investments across the U.S., Canada, and Mexico, has increased demand for insulation, coatings, and adhesives derived from propylene oxide. October 2024, Huntsman Corporation (USA) finalized the acquisition of a specialty PO derivatives manufacturer in Southeast Asia, strengthening its regional supply chain and expanding its reach in construction and automotive end-use markets. Ongoing R&D efforts have led to optimized catalysts and cleaner, more sustainable production techniques, while innovations in bio-based PO and green manufacturing processes align with strict North American environmental regulations, making sustainability a central factor in market growth. The U.S., as the largest regional market, has witnessed strategic expansions of production facilities to meet industrial demand, supported by the availability of domestic feedstocks such as natural gas liquids, which help mitigate feedstock price volatility. In December 2021, Chevron Phillips Chemical announced the growth of its propylene operations at its Cedar Bayou plant in Baytown, Texas. Furthermore, increasing applications in pharmaceuticals, surfactants, and electronics have diversified PO usage, enhancing market resilience. Despite these positive trends, challenges like fluctuating propylene prices and stringent environmental regulations compel manufacturers to continuously innovate and improve cost-efficiency, ensuring sustained growth in the North American PO market.

Market Drivers

Strong Demand from Construction and Automotive Sectors: In North America, propylene oxide demand is largely driven by the consumption of polyurethane foams in construction and automotive applications. The U.S. and Canada are experiencing growth in infrastructure renovation, energy-efficient building projects, and smart housing solutions, all of which require rigid polyurethane foams for insulation. At the same time, the automotive sector is using flexible polyurethane foams in seats, dashboards, and interior components to enhance comfort and lightweighting. These dual demand sources provide consistent growth momentum for propylene oxide production in the region.
Expanding Role in Specialty and Consumer Chemicals: Beyond polyurethane, propylene oxide serves as a precursor for propylene glycol and glycol ethers, which are widely used in pharmaceuticals, food and beverages, personal care, and paints. The pharmaceutical industry in North America is especially strong, with rising demand for propylene glycol as an excipient and carrier in drug formulations. In addition, the thriving cosmetics and packaged food industries rely heavily on these derivatives, ensuring that the region maintains robust and diversified demand for propylene oxide across multiple downstream applications.

Market Challenges

Environmental and Regulatory Pressures: A significant challenge in North America is compliance with stringent environmental regulations imposed by agencies like the U.S. Environmental Protection Agency (EPA). Propylene oxide is recognized as a hazardous air pollutant with carcinogenic potential, which has led to tighter restrictions on emissions, handling, and storage. Companies face rising compliance costs and are under pressure to invest in cleaner technologies and advanced safety measures, which can increase operational expenses and impact profit margins.
High Raw Material Price Volatility: The production of propylene oxide depends heavily on propylene, which is derived from crude oil and natural gas. Price fluctuations in these feedstocks, driven by geopolitical tensions, shale gas output shifts, and global oil market instability, directly affect the production costs of propylene oxide in North America. For producers, this volatility complicates long-term planning and makes it difficult to maintain stable pricing strategies, thereby posing a continuous challenge for market players.

Market Trends

Adoption of Eco-Friendly Production Technologies: A notable trend in North America is the industry’s shift toward more sustainable propylene oxide production processes. Technologies such as the HPPO (hydrogen peroxide to propylene oxide) method are being increasingly adopted due to their higher efficiency, lower environmental impact, and minimal byproduct generation. Major companies are investing in these greener alternatives to strengthen their market positions, reduce regulatory risks, and align with corporate sustainability goals.
Rising Focus on Localized Supply Chains: The pandemic and subsequent global supply chain disruptions highlighted the importance of securing regional production and distribution capabilities. In North America, there is a growing trend of establishing localized production facilities for propylene oxide and its derivatives to reduce dependency on imports and global trade uncertainties. This shift supports both supply security and resilience, while also catering more effectively to the growing demand from domestic industries like construction, automotive, and consumer goods.

The Styrene Monomer process type is moderately growing in North America’s propylene oxide industry due to the steady but controlled demand from the downstream polystyrene and styrene-based polymer sectors, coupled with increasing environmental regulations that limit rapid expansion.

In North America, the Styrene Monomer (SM) process for producing propylene oxide (PO) has been experiencing moderate growth, primarily influenced by the balance between industrial demand and regulatory constraints. The SM process, which involves the co-production of styrene as a byproduct, is particularly favored by industries that rely heavily on polystyrene, ABS (acrylonitrile butadiene styrene), and other styrene-based polymers. These polymers are widely used in automotive components, packaging materials, construction materials, and consumer goods, all of which contribute to consistent demand for propylene oxide through the SM route. However, unlike other process types such as the hydrogen peroxide or chlorohydrin processes, the SM process is capital-intensive and requires careful management of byproducts, which slows large-scale adoption and rapid expansion. Environmental and regulatory factors play a significant role in moderating growth. The production of propylene oxide via the SM process generates chemical byproducts that must be carefully managed to comply with stringent emissions standards enforced in the U.S. and Canada. These regulations, focusing on air quality, waste management, and chemical handling, increase operational costs and limit aggressive scaling of SM-based plants. Furthermore, technological advancements in process optimization and catalyst efficiency have helped improve yields and reduce energy consumption in the SM process, making it more sustainable and economically viable compared to earlier decades. This steady improvement supports moderate growth by allowing manufacturers to meet consistent demand while managing costs and regulatory compliance.

Propylene Glycol (PG) application is moderately growing in North America’s propylene oxide industry due to steady demand from food, pharmaceutical, and personal care sectors, tempered by market saturation and regulatory considerations.

The Propylene Glycol application segment in North America’s propylene oxide industry is experiencing moderate growth, primarily driven by consistent demand from multiple downstream industries, including food and beverage, pharmaceuticals, cosmetics, and personal care products. Propylene Glycol, derived from propylene oxide, serves as a versatile chemical with applications as a humectant, solvent, and preservative, which makes it essential in formulating products like medicines, skin care creams, packaged foods, and flavorings. In the pharmaceutical sector, for example, propylene glycol is widely used as a carrier for active ingredients in oral, topical, and injectable formulations, while in the personal care industry, it enhances moisture retention in lotions and creams. Similarly, the food industry relies on PG for flavor stabilization, moisture control, and as an additive in a range of processed products. This multi-industry demand ensures that the application remains steady and reliable. However, the growth remains moderate rather than rapid, due to several limiting factors. First, the market for propylene glycol in North America is relatively mature, with high penetration across key sectors, which constrains the pace of new demand. The existing infrastructure for PG production and distribution meets most of the current requirements, so incremental growth occurs primarily through replacement of imports, specialty formulations, or modest expansion in end-use applications. Regulatory considerations also influence growth, as strict guidelines on permissible concentrations, food-grade standards, and environmental handling impact production and limit aggressive scaling. For instance, the FDA and EPA regulations require manufacturers to adhere to stringent quality and safety standards, which can slow down new project approvals or expansions.

The Textile & Furnishing end-user segment is moderately growing in North America’s propylene oxide industry due to steady demand for polyester-based fibers and fabrics, tempered by market saturation and competition from alternative materials.

In North America, the Textile & Furnishing sector represents a moderately growing end-user segment for propylene oxide, largely driven by the consistent requirement for polyester resins, fibers, and polyurethane-based textile finishes. Propylene oxide is a key intermediate in producing polyether polyols, which are further used to manufacture polyurethane foams and coatings applied in textiles, upholstery, mattresses, and decorative furnishings. The demand for durable, flexible, and comfortable textile products in residential, commercial, and automotive interiors sustains steady consumption of propylene oxide derivatives. Polyester-based fabrics, often blended with polyurethane for stretchability and resilience, continue to support the industry, while innovations in textile finishing technologies, such as wrinkle resistance, flame retardancy, and stain protection, further reinforce the need for propylene oxide-derived chemicals. Despite these factors, growth in this segment is only moderate, rather than rapid. The North American textile market is highly mature, with well-established production capacities and supply chains. Consumer preferences have stabilized, and there is intense competition from alternative fibers and materials, including natural fibers, recycled fabrics, and other synthetic polymers, which limits significant expansion in propylene oxide usage. Furthermore, increasing environmental awareness and sustainability initiatives encourage manufacturers to explore bio-based or less energy-intensive alternatives, slightly restraining the growth of traditional propylene oxide applications in textiles. Regulatory pressures on chemical usage in consumer products, including restrictions on volatile organic compounds (VOCs) and hazardous additives in textile treatments, also necessitate cautious operational adjustments rather than aggressive capacity expansion.

The USA is leading the North American Propylene Oxide (PO) industry due to its advanced chemical manufacturing infrastructure, abundant feedstock availability, and strong demand from end-use industries like automotive, construction, and polyurethane production.

The United States has established itself as the dominant player in the North American Propylene Oxide market, driven by a combination of technological expertise, abundant raw material availability, and robust industrial demand. The country benefits from extensive chemical manufacturing infrastructure, including world-class refineries and production plants capable of producing high-quality PO efficiently and at scale. A critical factor contributing to the U.S. leadership is the easy accessibility of propylene feedstock, largely derived from shale gas and other petrochemical resources, which significantly reduces production costs and enhances the competitiveness of U.S.-made PO in both domestic and export markets. The strong presence of key end-use industries such as automotive, construction, electronics, and furniture further propels demand for PO, primarily for its use in producing polyurethanes, propylene glycols, and other derivatives. Polyurethane, in particular, is widely employed in flexible and rigid foams, coatings, adhesives, and sealants, all of which are integral to the country’s large-scale infrastructure and industrial projects. Moreover, favorable regulatory frameworks and government support for chemical manufacturing, combined with investment in research and development, allow U.S. manufacturers to adopt advanced production technologies, improve yields, and reduce environmental impact. Strategic collaborations between domestic and international chemical companies facilitate knowledge sharing and technological innovations, further strengthening the country’s competitive edge in the PO market. Additionally, the United States has a highly developed logistics and supply chain network that enables efficient distribution of PO and its derivatives across North America and to international markets.

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Table of Contents

88 Pages
1. Executive Summary
2. Market Dynamics
2.1. Market Drivers & Opportunities
2.2. Market Restraints & Challenges
2.3. Market Trends
2.4. Supply chain Analysis
2.5. Policy & Regulatory Framework
2.6. Industry Experts Views
3. Research Methodology
3.1. Secondary Research
3.2. Primary Data Collection
3.3. Market Formation & Validation
3.4. Report Writing, Quality Check & Delivery
4. Market Structure
4.1. Market Considerate
4.2. Assumptions
4.3. Limitations
4.4. Abbreviations
4.5. Sources
4.6. Definitions
5. Economic /Demographic Snapshot
6. North America Propylene Oxide Market Outlook
6.1. Market Size By Value
6.2. Market Share By Country
6.3. Market Size and Forecast, By Production Process
6.4. Market Size and Forecast, By Application
6.5. Market Size and Forecast, By End-use industry
6.6. United States Propylene Oxide Market Outlook
6.6.1. Market Size by Value
6.6.2. Market Size and Forecast By Production Process
6.6.3. Market Size and Forecast By Application
6.6.4. Market Size and Forecast By End-use industry
6.7. Canada Propylene Oxide Market Outlook
6.7.1. Market Size by Value
6.7.2. Market Size and Forecast By Production Process
6.7.3. Market Size and Forecast By Application
6.7.4. Market Size and Forecast By End-use industry
6.8. Mexico Propylene Oxide Market Outlook
6.8.1. Market Size by Value
6.8.2. Market Size and Forecast By Production Process
6.8.3. Market Size and Forecast By Application
6.8.4. Market Size and Forecast By End-use industry
7. Competitive Landscape
7.1. Competitive Dashboard
7.2. Business Strategies Adopted by Key Players
7.3. Key Players Market Positioning Matrix
7.4. Porter's Five Forces
7.5. Company Profile
7.5.1. Dow Inc.
7.5.1.1. Company Snapshot
7.5.1.2. Company Overview
7.5.1.3. Financial Highlights
7.5.1.4. Geographic Insights
7.5.1.5. Business Segment & Performance
7.5.1.6. Product Portfolio
7.5.1.7. Key Executives
7.5.1.8. Strategic Moves & Developments
7.5.2. BASF SE
7.5.3. LyondellBasell Industries N.V.
7.5.4. Shell Plc
7.5.5. Repsol S.A.
7.5.6. Merck KGaA
7.5.7. Sumitomo Chemical Co., Ltd.
7.5.8. AGC Inc.
7.5.9. Ineos Group Limited
7.5.10. Tokuyama Corporation
7.5.11. Tokyo Chemical Industry Co. Ltd.
7.5.12. Balchem Corporation
8. Strategic Recommendations
9. Annexure
9.1. FAQ`s
9.2. Notes
9.3. Related Reports
10. Disclaimer
List of Figures
Figure 1: Global Propylene Oxide Market Size (USD Billion) By Region, 2024 & 2030
Figure 2: Market attractiveness Index, By Region 2030
Figure 3: Market attractiveness Index, By Segment 2030
Figure 4: North America Propylene Oxide Market Size By Value (2019, 2024 & 2030F) (in USD Billion)
Figure 5: North America Propylene Oxide Market Share By Country (2024)
Figure 6: US Propylene Oxide Market Size By Value (2019, 2024 & 2030F) (in USD Billion)
Figure 7: Canada Propylene Oxide Market Size By Value (2019, 2024 & 2030F) (in USD Billion)
Figure 8: Mexico Propylene Oxide Market Size By Value (2019, 2024 & 2030F) (in USD Billion)
Figure 9: Porter's Five Forces of Global Propylene Oxide Market
List of Tables
Table 1: Global Propylene Oxide Market Snapshot, By Segmentation (2024 & 2030) (in USD Billion)
Table 2: Influencing Factors for Propylene Oxide Market, 2024
Table 3: Top 10 Counties Economic Snapshot 2022
Table 4: Economic Snapshot of Other Prominent Countries 2022
Table 5: Average Exchange Rates for Converting Foreign Currencies into U.S. Dollars
Table 6: North America Propylene Oxide Market Size and Forecast, By Production Process (2019 to 2030F) (In USD Billion)
Table 7: North America Propylene Oxide Market Size and Forecast, By Application (2019 to 2030F) (In USD Billion)
Table 8: North America Propylene Oxide Market Size and Forecast, By End-use industry (2019 to 2030F) (In USD Billion)
Table 9: United States Propylene Oxide Market Size and Forecast By Production Process (2019 to 2030F) (In USD Billion)
Table 10: United States Propylene Oxide Market Size and Forecast By Application (2019 to 2030F) (In USD Billion)
Table 11: United States Propylene Oxide Market Size and Forecast By End-use industry (2019 to 2030F) (In USD Billion)
Table 12: Canada Propylene Oxide Market Size and Forecast By Production Process (2019 to 2030F) (In USD Billion)
Table 13: Canada Propylene Oxide Market Size and Forecast By Application (2019 to 2030F) (In USD Billion)
Table 14: Canada Propylene Oxide Market Size and Forecast By End-use industry (2019 to 2030F) (In USD Billion)
Table 15: Mexico Propylene Oxide Market Size and Forecast By Production Process (2019 to 2030F) (In USD Billion)
Table 16: Mexico Propylene Oxide Market Size and Forecast By Application (2019 to 2030F) (In USD Billion)
Table 17: Mexico Propylene Oxide Market Size and Forecast By End-use industry (2019 to 2030F) (In USD Billion)
Table 18: Competitive Dashboard of top 5 players, 2024
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