Global Market Outlook on Propylene Glycol

  • The global market is estimated to grow at a CAGR of 4.4 percent during 2017–2022, with the demand likely to reach 3 MMT by the end of 2022
  • Demand for UPR (which goes into construction, transportation, marine industries as a reinforced plastic and fiberglass composites) is expected to grow at a CAGR of 5–6 percent from 2016 to 2021

price-forecast-propylene-glycol

Demand Market Outlook

  • Globally, high demand for bio-based PG is noticed from the pharma and CPG industries
  • The capacity share of bio-based PG will increase from approx. 6 percent (currently) to 15 percent 
  • PG growth rates in Europe will be lower (CAGR a of 3 – 4 percent) compared to other regions during 2017 – 2022, due to mature downstream markets

Industry Best Practices

  • Large-volume buyers usually prefer buying via contract across all the three major regions 
  • Among small-volume buyers, CPG players opt for contracts, due to the need for high-quality pharma grade MPG, while non-CPG small-volume buyers can buy in the spot market 
  • Regional sourcing is preferred in Europe, owing to REACH regulation on PG, while both global and regional sourcing are followed in North America and Europe

Global Market Size

  • The global PG market is expected to exceed $4.5 billion by 2022 
  • Bio-based PG is expected to grow faster than conventional PO-based PG, as a result of its high usage in pharma industries in the North American and European markets to ensure lower level of toxicity to the environment
  • Key applications driving the PG growth are heat transfer fluids, fragrance, cosmetics and personal care sectors

Global Capacity–Demand Analysis

  • Capacity–demand gap is expected to narrow down by 2020, if no further new plants or capacity expansions take place, resulting in supply issues 
  • Increase in buying interest for bio-based PG, globally, will help in mitigating volatility in PG prices, which is greatly influenced by upstream energy prices

Market Outlook 

  • Currently, the US is the largest market for PG, followed by China and Germany
  • Asia represents almost 43 percent of the global PG consumption, with China being the major consumer
  • Global capacity–demand gap is expected to narrow down by 2020, if no further new plants or capacity expansions take place, resulting in supply issues 
  • Globally, about 6 percent of PG is produced through biofuel route, made of glycerine (soybean or canola seeds in the US) or sorbitol (corn, based in China) 
  • Bio-based PG production would result in capacity expansions across China, France, and the US