Ceresana's market study "Propylene Value Chain USA" provides complete transparency regarding current and future development of the entire propylene value chain. The entire US market is analyzed. Starting with an analysis of the feedstocks used, mainly gasoil, naphtha and propane, the entire propylene value chain is examined. Attention is also given to various downstream products at different points of the value chain until final end applications.
Propylene - Important Petrochemical
The importance of propylene as major feedstock in the petrochemical industry can be seen in the immense demand volume. In 2013, the USA single-handedly consumed more than 14 million tonnes of propylene. Thus, propylene is the second most important petrochemical feedstock after ethylene. Downstream industries manufacture a range of products based on propylene. Direct applications include, besides the plastic polypropylene, chemicals such as propylene oxide, acrylonitrile, cumene, butyraldehyde, acrylic acid and isopropanol. The markets for these derivatives are analyzed in detail in the study.
Fracking Influencing Propylene Prices
As a result of the shale gas boom, ethane has become the dominant feedstock in steam crackers. In contrast to other feedstocks such as naphtha or gasoil, the cracking of ethane yields a rather high amount of ethylene but only small amounts of propylene. This development has a notable influence on prices for propylene in the USA. The change from naphtha based crackers to ethane based production reduced the supply of propylene and increased volatility of prices.
More Propylene Made By Dehydrogenation of Propane
In order to counteract the supply deficit, an increasing amount of propylene is to be manufactured from propane in the USA. Dehydrogenation of propane is a way to produce a high amount of propylene directly. Ceresana expects the share of propane in propylene production to rise to more than a third in 2021. Manufacturers are profiting from increasing propane supply in the USA.
Polypropylene Prime Application
Propylene is mainly processed into polypropylene. According to analyses of Ceresana, US demand for this plastic will increase by about 2% until 2021. The standard plastic polypropylene is one of the most versatile packaging materials. Other applications include fibers, textiles, vehicle parts, electrical devices and household goods.
Polyurethane Scoring With Versatility
The segment propylene oxide is highly dependent on the US market for polyurethane (PUR). PUR demand in the USA recovered comparatively quickly after the economic crisis hit, pre-crisis levels were already exceeded. The development on the PUR market is supported by innovations in particular, which continue to open up additional application areas. The manifold application possibilities include building insulation, cooling and refrigerating units, furniture and bedding, shoes, vehicles, varnishes, coatings, adhesives, binders, and rubber. But also the segments sports and leisure as well as electronics and electrics are reporting a rising demand for polyurethanes.
Limited Growth for Oxo Alcohols
Butyraldehyde, manufactured from propylene using oxo synthesis, is processed directly in to the oxo alcohols butanol and 2-ethylhexanol in the USA. Butanol is used in the production of varnishes, fragrances and the syntheses of ethers and esters, while 2-ethylhexanol is, amongst others, utilized in various plasticizers. We expect downstream industries to provide only limited impulses for oxo alcohols in the near future.
