Propylene price index

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Propylene price index

This post is a summary of the propylene (propene) price developments. The price developments of propylene are expressed in US$ prices converted FX rates applicable at the time when the price was valid. Propylene price index developments are calculated from multiple separate sources of data to ensure statistical accuracy.

The outlook for propylene (propene) prices, on the second tab, is generated from different inputs including:

• Very recent price developments of immediate cost drivers of propylene prices
• Recent price developments of underlying feedstocks which drive the price of propylene
• Market futures for both cost drives and feedstocks of propylene prices
• Adjustment of current supply/demand imbalances in the propylene (propene) market
• Longer term trends in likely demand conditions

Further information on the Propylene price chart

What is propylene

Propylene is a colorless, flammable gas that is a hydrocarbon with the chemical formula C3H6. It is also known as propene and is a byproduct of the refining of crude oil and natural gas.

Propylene is used in the production of a wide range of products, including plastics, fibers, solvents, and fuels. It is also used as a refrigerant and as a fuel for welding and cutting torches. Additionally, propylene is used in the production of polypropylene, which is one of the most widely used plastics in the world.

What is propylene used for

Propylene, also known as propene, is used for a variety of applications, including:

Production of plastics

Propylene is used as a key raw material in the production of a wide range of plastics, including polypropylene, which is one of the most widely used plastics in the world.

Production of fibers

Propylene is used in the production of synthetic fibers, such as carpeting and upholstery, as well as in the production of rope, twine, and other materials.

Solvents

Propylene is used as a solvent for various applications, such as cleaning and degreasing.

Fuels

Propylene is used as a fuel for welding and cutting torches.

Refrigerants

Propylene is used as a refrigerant in some industrial and commercial applications.

Chemical intermediates

Propylene is used as a starting material in the production of a variety of chemicals, such as propylene oxide, acrylic acid, and propylene glycol.

Overall, propylene is a versatile chemical that plays a vital role in a wide range of industries and applications.

How is propylene produced

Propylene is typically produced through a process known as steam cracking, which involves the thermal decomposition of hydrocarbons such as natural gas, naphtha, and propane. The process takes place in a furnace at high temperatures (around 850°C) and involves the following steps:

Feedstock preparation

The hydrocarbon feedstock is preheated and mixed with steam to create a mixture that is optimized for the cracking process.

Cracking

The feedstock mixture is heated to a high temperature and passed through a cracking furnace, where it is cracked into smaller molecules. This process produces a mixture of gases, including propylene, ethylene, and methane.

Separation

The mixture of gases is cooled and separated into different components using a variety of separation techniques, such as distillation and fractionation. Propylene is typically separated from the other gases using a series of separation columns.

Purification

The propylene is then purified using various methods, such as absorption, adsorption, and distillation, to remove impurities and contaminants.

The resulting purified propylene can then be used as a raw material for various applications in the chemical, plastics, and manufacturing industries.

What drives the cost of propylene

The cost of propylene is influenced by a variety of factors, including:

Feedstock prices

The primary raw materials used to produce propylene are naphtha, natural gas, and propane, and their prices can significantly impact the cost of propylene. Fluctuations in feedstock prices can occur due to supply and demand factors, geopolitical events, and natural disasters, among other factors.

Production capacity and utilization rates

The supply of propylene depends on the production capacity of the industry and the utilization rates of the plants. Production capacity and utilization rates can be influenced by a range of factors, such as maintenance shutdowns, production disruptions, and investment in new capacity.

Energy prices

The production of propylene requires a significant amount of energy, and energy prices can impact the cost of production. Fluctuations in energy prices can occur due to supply and demand factors, geopolitical events, and changes in government policies.

Transportation costs

Propylene is transported via pipelines, rail, and truck, and transportation costs can vary depending on the distance between the production site and the end user.

Market demand

The demand for propylene can also impact its price. Fluctuations in demand can occur due to changes in end-use markets, shifts in consumer preferences, and changes in government regulations.

Overall, the cost of propylene is influenced by a range of economic, geopolitical, and industry-specific factors that can vary over time.

What types of propylene are there

There are several types of propylene, including:

Polymer Grade Propylene

This type of propylene is used mainly for the production of polypropylene, which is a widely used plastic material. Polymer grade propylene typically has a purity of more than 99.5% and a low level of impurities.

Refinery Grade Propylene

This type of propylene is produced as a byproduct of the refining process and is typically used in gasoline blending or as a feedstock for other chemical processes. Refinery grade propylene has a purity of around 70% to 90%.

Chemical Grade Propylene

This type of propylene is used as a feedstock for the production of chemicals such as acrylic acid, acrylonitrile, and propylene oxide. Chemical grade propylene typically has a purity of around 95% to 99%.

High Purity Propylene

This type of propylene has a purity of more than 99.9% and is used in high-tech applications such as the production of semiconductors, electronic materials, and specialty chemicals.

Bio-based Propylene

This type of propylene is produced from renewable sources such as biomass or waste materials. Bio-based propylene is an emerging technology that offers a more sustainable and environmentally friendly alternative to conventional propylene production.

How big is the global propylene market

The global propylene market is large and growing. According to a report by Mordor Intelligence, the global propylene market was valued at $90.51 billion in 2020 and is expected to reach $118.32 billion by 2026, growing at a compound annual growth rate (CAGR) of 4.6% during the forecast period.

The growth of the propylene market can be attributed to several factors, including the increasing demand for propylene derivatives such as polypropylene, acrylonitrile, and propylene oxide, as well as the growing demand for propylene in the packaging, automotive, construction, and electronics industries. Additionally, the growing demand for cleaner and more sustainable energy sources is driving the demand for bio-based propylene derived from renewable sources.

The Asia-Pacific region is the largest market for propylene, accounting for more than 50% of the global market share, followed by North America and Europe. The growth in the Asia-Pacific region can be attributed to the increasing demand for propylene derivatives in emerging economies such as China and India, as well as the growing demand for propylene in the automotive and construction industries.

According to https://oec.world/ :

Propene (propylene) are the world’s 537th most traded product.

In 2020, the top exporters of Propene (propylene) were South Korea ($1.17B), Netherlands ($571M), United States ($559M), Japan ($554M), and Chinese Taipei ($285M).

In 2020, the top importers of Propene (propylene) were China ($1.92B), Germany ($631M), Belgium ($474M), Netherlands ($326M), and France ($260M).

Which countries produce the most propylene

According to the latest available data from the International Energy Agency (IEA), the top five countries that produce the most propylene are:

United States

The United States is the largest producer of propylene in the world, accounting for approximately 20% of the global production. The US produces propylene primarily through the steam cracking of hydrocarbons such as ethane, propane, and butane.

China

China is the second-largest producer of propylene, accounting for approximately 16% of the global production. China produces propylene mainly through the steam cracking of naphtha and propane.

Europe

The European Union (EU) is the third-largest producer of propylene, accounting for approximately 15% of the global production. Propylene production in Europe is concentrated in countries such as Germany, France, and the Netherlands.

Middle East

The Middle East is the fourth-largest producer of propylene, accounting for approximately 13% of the global production. Propylene production in the Middle East is mainly driven by the petrochemical industries in countries such as Saudi Arabia, Iran, and Qatar.

Japan

Japan is the fifth-largest producer of propylene, accounting for approximately 6% of the global production. Propylene production in Japan is mainly driven by the petrochemical industry, and it is produced mainly through the steam cracking of naphtha.

Overall, propylene production is concentrated in a relatively small number of countries, reflecting the significant capital investment required to build and operate propylene production facilities.

Further information

• Wikipedia for general, history, production and usage information
• PubChem for chemistry and property  information