US Propane Market Size
| Study Period | 2019 - 2029 |
| Base Year For Estimation | 2023 |
| Forecast Data Period | 2024 - 2029 |
| Historical Data Period | 2019 - 2022 |
| CAGR | 5.00 % |
| Market Concentration | Low |
Major Players
*Disclaimer: Major Players sorted in no particular order |
US Propane Market Analysis
During the time frame of the forecast, the US propane market is expected to grow at a CAGR of more than 5%.
During the COVID-19 pandemic, the U.S. propane market had challenges with supply chains; there was more demand for home heating, and demand for commercial and industrial use went down. But as soon as the pandemic was over and the economy reopened, the market started to improve and is estimated to reach a pre-pandemic level in 2023.
- The increasing demand from the residential and transportation sectors has driven market growth.
- But the harmful effects of propane at higher concentrations are likely to keep the studied market from growing.
- Propane usage in power generation will likely provide opportunities for the US propane market over the next five years.
- Residential is the most dominant end-user segment of the market studied.
US Propane Market Trends
This section covers the major market trends shaping the US Propane Market according to our research experts:
The Residential Segment to Dominate the Market
In the residential sector, propane is used for air conditioning, heating water, cooking, refrigerating foods, drying clothes, lighting, and fueling fireplaces.
- Propane is used mostly in homes in rural areas that do not have natural gas service, as well as in mobile homes. Millions of homes use propane to meet some of their energy requirements. In the United States, about five million households use propane as their main heating source, and around one-fifth of mobile homes use propane for heating.
- The average residential propane tank holds between 500 and 1,000 gallons of liquid fuel. Millions of backyard cooks use propane-powered gas grills for cooking. Moreover, recreational vehicles usually have propane-fueled appliances, giving them a portable source of energy for cooking, hot water, and refrigeration.
- Over the past few years, there has been a consistent rise in the number of residentially occupied housing units that heat their homes using utility gas. The number of homes in the United States that use gas as their main source of heat is expected to reach 59,246,257 in 2021. This is equivalent to 46.7% of all homes.
- The increasing new residential construction, combined with continuing fuel oil conversions, is expected to offset residential space heating losses to electricity and natural gas, which is leading to a slow growth in the number of residential space heating customers through 2025.
- But because propane use is becoming more efficient, the future demand for propane may stay the same in terms of volume.
- The above-mentioned factors are anticipated to enable the residential segment to dominate the market.
Growing Commercial Sector
- Propane is utilized in the same manner as natural gas is in the business sector. Propane is used for a wide variety of purposes in a large number of commercial establishments, including but not limited to restaurants, hotels, dry cleaners, automobile mechanics, auto body repair shops, wineries, offices, and warehouses.
- Fuel for energy-efficient space heating, cooking, fireplaces, water heating, clothes drying, and various other needs can be obtained from propane. This is especially helpful in big buildings like hospitals, resorts, and warehouses that use propane gas as a fuel for a lot of different things, like heating, cooling, soldering, and brazing.
- Propane is a common energy source in restaurants around the United States, where it is used for cooking and heating. Propane is a popular choice for food service operations that take place in outdoor settings or that utilize mobile kitchens since it is a versatile fuel that delivers a high heat output and is simple to transport. According to information from the US Census Bureau, food retail sales in the US reached USD 7.441 trillion in 2021, which was a 19% increase from the previous year.
- Propane is also the best option for backup generators that are used in commercial facilities because it can be stored for an infinite amount of time, does not degrade with time like gasoline does, and does not become more viscous in cold temperatures like diesel does.
- Propane provides commercial buildings and facilities with all of the benefits that gas provides at a price that is highly competitive when compared to the cost of other alternative forms of energy. Because it is less expensive and better for the environment, selecting it for business applications is likely to yield the best results.
- Because of the things we've talked about, it's expected that the commercial sector will be able to take the lead in the market.
US Propane Industry Overview
The US propane market is partially fragmented in nature. Some of the major companies (in no particular order) are AmeriGas Propane, Ferrellgas Partners LP, Suburban Propane Partners LP, Growmark Inc., and CHS Inc., among others.
US Propane Market Leaders
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AmeriGas Propane
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Ferrellgas Partners LP
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Suburban Propane Partners LP
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Growmark Inc.
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CHS Inc.
*Disclaimer: Major Players sorted in no particular order
US Propane Market News
- December 2022: Suburban Propane Partners, L.P. acquires assets for the production of renewable natural gas ("RNG") from Equilibrium Capital Group. The collaboration was developed to serve as a long-term growth platform for the identification, development, and management of further RNG projects, resulting in the acquisition of two biogas facilities that were already in operation.
- August 2022: AmeriGas has just acquired a forklift cylinder exchange in the state of Florida. This purchase will allow the company to increase its presence and reach in the rapidly expanding Florida market. AmeriGas will be able to continue its expansion in South Florida because of the outstanding opportunity presented by this acquisition.
US Propane Market Report - Table of Contents
1. INTRODUCTION
- 1.1 Study Assumptions
- 1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET DYNAMICS
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4.1 Drivers
- 4.1.1 Increase in Demand from Residential and Transportation Sectors
- 4.1.2 Demand in the Petrochemical Industry
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4.2 Restraints
- 4.2.1 Harmful Effects of Propane at Higher Concentrations
- 4.3 Industry Value Chain Analysis
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4.4 Porter's Five Forces Analysis
- 4.4.1 Threat of New Entrants
- 4.4.2 Bargaining Power of Buyers
- 4.4.3 Bargaining Power of Suppliers
- 4.4.4 Threat of Substitute Products
- 4.4.5 Degree of Competition
5. MARKET SEGMENTATION
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5.1 End-user Industry
- 5.1.1 Residential
- 5.1.2 Commercial
- 5.1.3 Transportation
- 5.1.4 Industrial
- 5.1.5 Other End-user Industries
6. COMPETITIVE LANDSCAPE
- 6.1 Mergers and Acquisitions, Joint Ventures, Collaborations, and Agreements
- 6.2 Market Share(%)**/Ranking Analysis
- 6.3 Strategies Adopted by Leading Players
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6.4 Company Profiles
- 6.4.1 AmeriGas Propane Inc.
- 6.4.2 Chevron Corporation
- 6.4.3 CHS Inc.
- 6.4.4 ConocoPhillips Company
- 6.4.5 Exxon Mobil Corporation
- 6.4.6 Ferrellgas
- 6.4.7 GROWMARK Inc.
- 6.4.8 Phillips 66 Company
- 6.4.9 Royal Dutch Shell PLC
- 6.4.10 Suburban Propane
- 6.4.11 Superior Plus Energy Services Inc.
- 6.4.12 ThompsonGas
- *List Not Exhaustive
7. MARKET OPPORTUNITIES AND FUTURE TRENDS
- 7.1 Usage of Propane in Power Generation
- 7.2 Other Opportunities
US Propane Industry Segmentation
Propane is a three-carbon alkane gas (C3H8). It is stored under pressure inside a tank as a colorless, odorless liquid. The United States propane market report includes segmentation by end-user industry, which includes residential, commercial, transportation, industrial, and other end-user industries. For each segment, market sizing and forecasts have been done on the basis of volume (kilotons).
| End-user Industry | Residential |
| Commercial | |
| Transportation | |
| Industrial | |
| Other End-user Industries |
US Propane Market Research FAQs
What is the current United States Propane Market size?
The United States Propane Market is projected to register a CAGR of greater than 5% during the forecast period (2024-2029)
Who are the key players in United States Propane Market?
AmeriGas Propane, Ferrellgas Partners LP, Suburban Propane Partners LP, Growmark Inc. and CHS Inc. are the major companies operating in the United States Propane Market.
What years does this United States Propane Market cover?
The report covers the United States Propane Market historical market size for years: 2019, 2020, 2021, 2022 and 2023. The report also forecasts the United States Propane Market size for years: 2024, 2025, 2026, 2027, 2028 and 2029.
What are the segments of the US Propane Market?
The segments of the US Propane Market include a) End-user industry: residential, commercial, transportation, industrial b) Grade: HD-5 and HD-10 c) Form: Liquid and Gas
US Propane Industry Report
The U.S. propane market is on a trajectory of significant growth, fueled by its broad applications across residential, commercial, industrial, and transportation sectors. Highlighted by grades such as HD-5, HD-10, and commercial propane, the market is expanding to meet the needs of a diverse range of end-users. Particularly dominant in the residential sector, propane is celebrated for its efficiency, versatility, and environmental benefits, making it a top choice for heating, cooking, and other home uses. The commercial sector is also experiencing a surge in propane demand, notably in restaurants and hotels for heating and culinary purposes. This growth is propelled by the rising demand for cleaner-burning fuels, the necessity for energy solutions in remote areas, and efforts to reduce carbon footprints and greenhouse gas emissions. However, the market faces challenges like high installation and maintenance costs. Despite these hurdles, the future of the U.S. propane market looks bright, driven by technological innovations in extraction, distribution, and storage, alongside investments to improve propane accessibility. Propane manufacturers are leading this growth wave, innovating and broadening their product range to cater to the escalating demand. For detailed insights, Mordor Intelligence™ Industry Reports offer a comprehensive analysis, including market share, size, revenue growth rates, and a forecast outlook, available as a free report PDF download for a snapshot of this dynamic industry.
