Growing high-quality animal feed consumption has led to increased feed preservatives demand which in turn is expected to drive propionic acid market growth. Increasing requirement for mold and bacteria-inhibiting additives coupled with growing demand for feed products having longer shelf-life is expected to fuel market growth. Propionic acid is not only an ideal preservative but also forms a major element in the manufacturing of vitamin E. Depleting vital nutrients in animal food sources also proposes an optimistic outlook for propionic acid-based feed products. The product also finds applications in food & grain preservatives, herbicides, and chemical & pharmaceutical industry. Growing demand for packaged food & beverages has led to increased consumption of food preservatives which has led to increased market penetration in food preservatives. EPA, FDA and OSHA approvals regarding the use of propionic acid in animal feed and food additives has given an impetus to market growth. Excluding U.S., global per capita consumption of food preservatives is estimated to be below average providing immense potential for market growth over the forecast period.

Lack of manufacturing facilities in many countries has limited supply and is responsible for a global average price hike of propionic acid & its derivatives. The high price of propionic acid coupled with limited manufacturing technologies poses a serious threat to market growth over the next six years. 

Global propionic acid market estimates and forecast, by application, 2012 - 2020 (Kilo Tons)

Untapped and developing application segments including antibiotics are expected to have promising future prospective for propionic acid market demand.

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Further key findings from the study suggest:

• Global propionic acid market demand was 399.4 kilo tons in 2013 and is expected to exceed 470.0 kilo tons by 2020, growing at an estimated CAGR of 2.7% from 2014 to 2020.

• North America propionic acid market accounted for over 28% of global demand in 2013 and is estimated to lose share to high growth regions such as Asia Pacific. Asia Pacific market is expected to grow at a CAGR of over 3% from 2014 to 2020 owing to expanding animal feed additives industry in Australia, India and China. Chinese propionic acid market is characterized by growing demand in food preservatives and pharmaceuticals.

• Calcium & sodium propionate was the second largest application segment accounting for over 18% of the global demand in 2013 and is estimated to grow at a CAGR of over 2.5% from 2014 to 2020. Increasing packed food consumption due to changing lifestyle is expected to drive calcium & sodium propionate demand in food preservatives.

• Propionic acid market comprises some major chemical manufacturing firms and is moderately consolidated. The market participants have been investing heavily on capacity expansions and application development. Some key players in the market include BASF, Eastman Chemical Company, Dow, Perstorp and Biomin Holdings GmbH.

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