As we move into the second half of 2025, the Propylene Glycol (PG) market is entering a period of change, and many customers are asking what’s ahead.
While PG pricing is typically shaped by factors like crude oil, corn, and soybean markets, the big story this year is Dow Chemical’s decision to shut down its Freeport, Texas facility by the end of 2025. The announcement caught many distributors and downstream users off guard, and its impact could be felt well into 2026.
So what does this mean for the market? And what should customers expect?
Let’s break it down.
A Shift in Domestic Supply
Dow Chemical’s Freeport, TX facility has long been a major U.S. producer of propylene oxide, the primary building block of Propylene Glycol. Its shutdown could lead to a reduction in domestic PG capacity, and although Dow has global assets that they may use to backfill volume, the transition raises important supply chain questions.
Other producers have already started investing in additional capacity in anticipation of the shift. But even with increased production from other sources, it’s unclear whether the market will adjust without disruption.
Timing Matters
The Freeport shutdown coincides with seasonal demand for deicing fluids, and longer lead times are already being seen in the market. Dow has quoted some large-volume PG orders with lead times of up to five months.
In a tightly balanced market, even small shifts in supply can cause ripple effects. And when a major player exits the space – especially without broad communication – distributors and end users may feel the strain.
Market Factors at Play
Pricing trends in PG don’t follow just one rule. They’re shaped by a few key inputs:
- Crude Oil – Price swings in refinery-grade propylene, often linked to global oil and currency markets, can affect PG pricing downstream.
- Bio-Based Sources – Soy and corn prices influence the cost structure for bio-based PG producers.
- Trade Conditions – Recent tariffs and global trade dynamics have added more uncertainty to global markets and to the chemical markets overall.
Despite these pressures, the core challenge ahead isn’t just supply – it’s timing and communication. While no one can predict the future, every business needs a trusted partner to help navigate change.
What Customers Should Expect
At CORECHEM, our view is simple: plan early and stay informed.
As Dow winds down operations at Freeport, customers should expect:
- Potential for longer lead times, especially for high-volume needs
- Increased reliance on overseas sourcing for Dow-based supply chains
- Possible pricing fluctuations tied to availability and raw material trends
Where CORECHEM Stands
Although we’ve sourced Dow material in the past, CORECHEM primarily partners with non-Dow producers, including renewable and bio-based sources. Our goal has always been to maintain strong supply chain continuity, regardless of market shifts.
If you’re concerned about how this change may affect your operations, we’re here to help. Whether you need bulk PG or finished products, our team is ready to support your planning and procurement efforts with clear communication and reliable options.
“We can’t predict the market – but we’ll always keep you informed. That’s our promise.”
Questions about PG availability or planning for 2026?
Contact us today to talk with a member of our team.
