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Driven by greenhouse, mulch applications, global agricultural films market estimated over US$7 bln by 2017

Driven by greenhouse, mulch applications, global agricultural films market estimated over US$7 bln by 2017

28-Mar-14

Agricultural films are protective films that are placed over soil, wrapped around fodder or covered over greenhouses. Agricultural films offer several advantages such as reducing soil compaction and erosion, increasing soil temperature, providing nutrients, suppressing the growth of weeds, supporting seed germination, and protecting against UV rays. Agricultural films can be classified based on their applications as: greenhouse film, mulch film and silage film. They are generally manufactured using polyethylene (PE), polyvinyl chloride (PVC) and ethylene vinyl alcohol polymer (EVOH) among other materials. Linear low density polyethylene (LLDPE) and low density polyethylene (LDPE) dominate the overall agricultural films market.
As per Markets and Markets, the global agricultural film market is estimated to be worth US$7.1 bln by 2017. Agricultural films are gaining importance with the advent of high technologies in agriculture and emphasis on higher productivity per hectare. High growth in global population is one of the biggest challenges for the agriculture industry, which has led to increased focus on agricultural productivity. The major purpose of using agricultural films is high sustainable production on limited arable land. The use of agricultural films for controlled agriculture has helped in increasing the yields on the limited arable land with limited irrigation water. The three major applications of agricultural films are greenhouse, mulch, and silage. The arable land is decreasing gradually with drastic increase in urbanization. Controlled agriculture becomes important in order to utilize significant resources like water for irrigation in an optimum manner. This is consequently increasing the importance of controlled agriculture in greenhouse, high tunnel and mulching.

According to a study by Research and Markets, the global market for agricultural films is estimated to touch US$4.14 bln by 2019. Agricultural films mainly used in greenhouse, mulching and silage applications, are expected to witness strong demand on the back of increasing demand for vegetables and fruits such as tomatoes, cucumbers, strawberries, etc, that is expected to drive the market for greenhouse films especially in Asia Pacific. Consumption of agricultural film in North America was nearly 196,000 tons in 2012. The European market is highly saturated due to decreasing arable land and shift towards organic farming, with demand expected to reach 826,000 tons by 2019. China is expected to be fastest growing market growing at an estimated CAGR of 6% from 2013 to 2019. Linear Low Density Polyethylene (LLDPE) is expected to be the fastest growing film type at a CAGR of 5.9% from 2013 to 2019. LLDPE and LDPE together accounted for more than 78% of the total demand in 2012. LDPE film is expected to reach nearly US$2059 mln by 2019. Reclaimed films are widely used in developed countries due to environmental regulations regarding use of plastics. The consumption of reclaimed film is expected to reach nearly 315,000 tons by 2019. The other film types such as PVC, EVOH, etc. are expected to grow at a CAGR of 5.5% between 2013 and 2019. HDPE films find limited applications as they are known for their rigid characteristics, and accounted for more than 7% of the total market in 2012. Agricultural films are predominantly used in greenhouse and mulching applications- that together accounted for more than 85% of the overall market in 2012. Greenhouse application is expected to reach more than 2768,000 tons by 2019. Mulching and silage application is expected to grow at a CAGR of 5.7% and 5.4% respectively, from 2013 to 2019. It is expected to be fastest growing application during the forecast period, expected to reach US$4145 mln by 2019. In terms of revenue, silage films are expected to grow at an estimated CAGR of 7.9% between 2013 and 2019. 

As per Transparency Market Research, the global agricultural film market was valued at US$5.87 bln in 2012 and is expected to reach US$9.66 bln by 2019, growing at a CAGR of 7.6% from 2013 to 2019. In terms of volume, the global demand was 4,410.3 kilo tons in 2012 and is expected to grow at a CAGR of 5.7% from 2013 to 2019. Depleting arable land coupled with increasing food demand has led to increasing preference towards agricultural films as they help in increasing the agricultural productivity. In addition, rising global farming standards backed by technological advancement is further expected to boost the market growth. However, adverse impact of agricultural films due to its raw material and high cost of disposal are expected to inhibit market growth during the forecast period. Biodegradable films are expected to have immense opportunity in the coming future. Linear Low Density Polyethylene (LLDPE) was the largest consumed product and accounted for over 55% of the total market in 2012 with global consumption expected to reach 1,470.8 kilo tons by 2019. The shift in production capacities of polyethylene in Middle East and Asia is expected to drive the agricultural film market. China has been the largest producer of agricultural films with large numbers of small manufacturers in this region. The consumption of reclaimed film has been dominant in developed countries owing to stringent environmental regulations regarding use of plastics. The major applications of agricultural film include greenhouse, mulching and silage among others. Mulching application accounted for over 40% of the overall market in 2012. Greenhouse application is expected to be fastest growing application expected to grow at a CAGR of 5.8% from 2013 to 2019. The consumption of silage film has been high in pasture areas and is further expected to increase due to growing demand for dairy products. Agricultural films consumption for silage application was 582.5 kilo tons in 2012. China emerged as the leading consumer of agricultural films and accounted for more than 61% of the total demand in 2012. Growing food demand globally coupled with advanced farming techniques is expected to mushroom the market growth. In addition, it is expected to be the fastest growing market at an estimated CAGR of 6% from 2013 to 2019. The consumption of greenhouse films has been predominant in Asia Pacific due to rising demand for ornamental crops. Europe is expected to grow at a sluggish rate as the shrinkage in arable land and pastures. In 2012, Italy and Spain were the largest consumers of agricultural films in Europe. The demand for agricultural films from Middle East and Africa is expected grow at a CAGR of 5.3% between 2013 and 2019. The harsh climatic conditions and growing horticulture and floriculture market is expected to boost market growth during the forecast period. The global agricultural film market was highly fragmented as top three players accounted for nearly 16% of the market share in 2012. British Polyethylene Industries, Exxon Mobil, Trioplast, Armando Alvarez, Ab Rani Plast Oy, Group Barbier, Novamont, BASF, Britton Group, AEP Industries, Dow Chemical, Berry Plastics and Kuraray among others are the major industry participants in the agricultural film market.
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