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Propane market driven by rising demand for LPG as fuel for forklifts and trucks

Propane market driven by rising demand for LPG as fuel for forklifts and trucks

Propane, also known as liquefied petroleum gas (LPG), is a gas that is extracted from natural gas and oil refining. It offers efficient combustion as compared to other hydrocarbon fuels and produces less greenhouse gas emissions than coal or oil. Propane finds application as a fuel for vehicles, heating, lighting, and cooking. The residential and commercial sectors extensively use propane for heating, cooking, and other purposes. Meanwhile, propane is also increasingly being used as an alternative fuel for vehicles such as forklifts, trucks, and buses. This shift towards cleaner fuels is a major driver for the rising demand of propane from the transportation sector. The global propane market is estimated to be valued at US$ 98.5 Bn in 2023 and is expected to exhibit a CAGR of 7.1% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.

Market key trends: One of the key trends in the propane market is the increasing production of unconventional oil and gas through processes such as hydraulic fracturing. This has led to abundant availability of propane as a by-product globally. According to estimates, shale gas production in the U.S. alone is expected to contribute more than 50% of the total natural gas supply by 2030. Rising shale gas output is expected to augment the supply of propane and support the market growth over the forecast period.

Porter's Analysis

Threat of new entrants: The threat of new entrants in the propane market is moderate as it requires high initial investments to set up production facilities and distribution networks.

Bargaining power of buyers: The bargaining power of buyers is moderate to high as propane has substitutes like natural gas, electricity and buyers can switch to substitutes if price increases significantly.

Bargaining power of suppliers: The bargaining power of suppliers is moderate to high as suppliers like oil and gas producers have significant control over global propane supply.

Threat of new substitutes: The threat of substitutes like natural gas and electricity for residential heating and various industrial applications poses moderate threat to the propane market.

Competitive rivalry: The propane market witnesses moderate to high competition among existing players globally.

Key Takeaways

The Global Propane Market Share is expected to witness high growth over the forecast period of 2023 to 2030.

Regional analysis: The North America region currently dominates the global propane market with the largest share. This is attributed to high consumption of propane for residential and commercial heating in countries like US and Canada. Moreover, countries like China and India are also expected to offer lucrative growth opportunities for propane market in the Asia Pacific region owing to rising demand from commercial, residential, and industrial sectors.

Key players operating in the propane market are Merck KGaA, Thermo Fisher Scientific Inc., Avantor, Inc., Lonza Group Ltd., Bio-Rad Laboratories, Inc., Sartorius AG, Corning Inc., Becton, Dickinson and Company, GE Healthcare, Promega Corporation. Key players are focusing on capacity expansion and new product launches to strengthen their market position and capitalize on high growth opportunities.

For more insights, Read- https://www.insightprobing.com/propane-market-demand-share-analysis/

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