Global Propane Market 2014 Analysis, Size, Trends And Forecast 2022 By Product, Company, Region And Industry Analysis
Propane is a gas that is extracted from crude oil through stabilization process using fractional distillation. It is used by the residential, commercial, transportation, industrial, and chemical & refinery sectors. Propane is also one of the green fuels as it burns clearly and efficiently without any harmful emissions. Growing energy demand of a country is fulfilled through propane imports.
Consumption of propane as a fuel is likely to rise in the market, as compared to oil, owing to its clean form of existence. Crude oil has not been able to comply with the emission standards, unlike propane, even after several stages of crude oil processing. Propane is gradually being accepted as one of the primary fuels due to its application in the transportation and residential sectors. Handling, storage and distribution of propane require specialized vehicles, equipment and tanks. This adds to the total transportation and handling costs, which in turn, raises the overall cost of propane.
The propane market is segmented on the basis of application and geography. In terms of application, propane can be further classified into residential, commercial, industrial, agricultural, chemical & refinery, and transportation segments. The residential segment is expected to dominate the overall propane market between 2014 and 2022. The residential sector chiefly comprises housing societies, multi-family housing, and planned communities. Propane has a higher market share in residential applications as compared to commercial and industrial sectors. The commercial sector mainly involves educational institutions, restaurants and showrooms. Industrial applications involve welding and space heating. The commercial sector is one of the diverse markets with a wide range of end-users and customer types than others sectors. Demand for propane for space heating in commercial applications is seasonal and fluctuates with rise and fall in the temperature in various regions. The utility of propane is also rising in schools and fast-food restaurants, etc. Furthermore, propane is used to generate power in commercial buildings.
The global market for propane has been segmented into five regions: North America, Latin America, Asia Pacific, Europe, and Middle East and Africa. North America has been further sub-segmented into the U.S., Mexico and Canada. A similar approach has been taken for Asia Pacific, wherein the region has been sub-segmented into China, India, Japan and the Rest of Asia Pacific. The industrial and chemical & refinery segments are expected to drive the demand for propane in Asia Pacific. As the economies in Western Europe emerge from the downturn, improved growth is expected in the region’s automotive industry. The transportation and power generation sectors are expected to contribute significantly to the growing demand for propane in North America in the near future. The petrochemical industry alternatively switches over to other commodities, when the price of propane is too high. Propane demand commonly exhibits seasonal patterns â€’ rising during the summer, when its price is low, and falling during the winter, when its price is high. Petrochemical demand is also regional due to the high concentration of petrochemical plants in the Gulf Coast of the U.S. and Asia Pacific.
Some of the drivers of the propane market include stringent environment regulations, usage in marine industry as clean fuel, and focus on decreasing reliance on conventional gas sources. Emerging economies such as China and India with increased industrialization and lucrative petrochemical industry is anticipated to boost the propane market in the next few years. Limited awareness of benefits of propane as a clean fuel is expected to restrain the overall market growth. Usage of propane in power plants is likely to provide opportunities for the market in the near future.
Some of the global players in the propane market include Ferrellgas Partners, L.P., Lykins Energy Solutions, Marsh LP Gas Company Inc., Suburban Propane Partners, L.P., ThompsonGas and Sparlingss Propane Co. Ltd.