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India, China to drive growth of global plastic additives projected to grow at CAGR of 3.8% till end of decade

India, China to drive growth of global plastic additives projected to grow at CAGR of 3.8% till end of decade

30-Mar-15

The global plastic additives market is forecasted to reach US$50 bln by 2020 and is projected to grow at a CAGR of 3.8% during the forecast period. India and China are the lucrative markets due to presence of low-cost labour and raw materials, as per Futuremarketinsights.com. Plasticizers is the largest revenue generating segment of the plastic additives market valued at US$21.4 bln, followed by flame retardants with a CAGR of 5.4% projected for 2013-2020. The anti-microbial segment will also grow at a moderate rate due to increase in demand from the healthcare industry. The plastic additive industry is energy- and capital-intensive, wherein gas and oil are the major raw materials. It is easy to use and has numerous applications that make it an adaptable industry. Asia Pacific is the leader globally in terms of value and volume and production and consumption, and the key drivers being the surge in its automobile and infrastructure industry. Additionally, the Chinese and Indian automobile industries are expected to grow at 8% to 14% respectively during the forecast period 2014 to 2020. Plastic additives can be classified as reinforcing fibres, coupling agents, stabilizers, colorants, fillers, processing aids, flame retardants, peroxides and antistatic agents. Plastic additives enable safe handling of the plastic during the manufacture of finished products. The stabilizing plastic additives are halogen stabilizers, ultraviolet absorbers, antioxidants and biological preservatives. Also, there are processing aids such as lubricants and flow controls.
The end-uses of plastic additives are in the plastic industry and its products. For example, fire retardation plastic additives are added to polymers to break them down. This ensures reduced viscosity, which is essential for moulding the plastics into various finished products. Another example is that of ultraviolet absorbers, which are added in plastic pots used in plantations, to enable resistance to ultraviolet rays. Anti-microbial plastic additives are also used in this product as well as other products, as microorganisms can decompose plastics into monomers. Lubricants minimizes both internal and external friction, helps mould release and enhance mould flow. Fillers are used to increase the volume of the plastic available and to make it cost-effective. Also, temperature resistance of plastics is enhanced by plastic additives. Additives facilitate the use of plastic in space craft due to the ability to sustain at high temperatures. Plastic additives have a large number of applications in defence, aerospace, aviation, automotive, consumer appliances, commodities, paints and coatings, FMCG and packaging industries. Plastic additive producers are currently focusing on developing economies such as Asia Pacific. The region accounted for around 40% revenue of the plastic additives market as of 2013, which is projected to increase to 60% by 2020. Increasing awareness regarding conservation of depleting natural resources is expediting growth of the plastic additives market in Asia Pacific. Growth prospects in the plastic additives market are vast and numerous players in the market are constantly investing and focusing on innovations in this industry through the use of plastic additives. BASF, Chemtura Corporation, Exxon Mobil Corporation, Clariant Ltd., Bayer AGand Kaneka are some major players in the plastic additives market. The overall chemical industry has grown at around 2 to 5%, which is positive sign for the evolving plastic additives market.

The global plastic additives market in this report is estimate in terms of revenue and volume. As per Reportlinker, the global plastic additives market was valued at US$41.4 bln in 2013 and is expected to generate revenue of US$57.8 bln by 2020 at a CAGR of 4.9% during 2013-2020. The global plastic additives market in terms of volume was estimated at 12,619.8 kilotons in 2013 and is expected to reach 17,071.7 kilotons by 2020 growing at a CAGR of 4.4% during 2013-2020. Increase in environmental awareness and intervention by government to promote non-toxic plastic additives is promoting the growth in plastic additives market. However, increase in health concerns due to consumption of Phthalates based plasticizers is forcing the government to harness the regulations for controlling commercialization of such additives. In the United States, the application of phthalates in the manufacturing of toys and other children's product is banned under the guidance of Consumer Products Safety Improvement Act (CPSIA).  Impacting drivers of plastic additives market such as increase in environmental awareness and intervention by government to promote non-toxic plastic additives is promoting the growth in plastic additives market. However, increase in health concerns due to consumption of Phthalates based plasticizers is forcing the government to harness the regulations for controlling commercialization of such additives. In the US, the application of phthalates in the manufacturing of toys and other children's product is banned under the guidance of Consumer Products Safety Improvement Act (CPSIA).

As per MarketsandMarkets, the plastic additives market is projected to register a CAGR of 5% between 2014 and 2019 to reach US$45.5 bln by 2019. Asia-Pacific dominated the plastic additives market in 2013 and accounted for over 40% of the market share, by volume. Country-wise, China is projected to be the top consumer of plastic additives globally by 2019, and is estimated to register a high CAGR between 2014 and 2019 for plastic additives market. USA is currently the largest plastic additives consumer in the world but is anticipated to be outcaste by China in the near future. The demand for the plastic additives is driven by the diverse applications ranging from packaging, construction, consumer goods, and automotive among others. Growing GDP, rapid pace of industrialization, increased consumption of plastic materials, consumer goods, and packaging products remain key growth driving forces for this market. Future growth in the market hinges heavily onto developing economies in Asia Pacific, South America, and Eastern Europe. Packaging segment lead the plastic additives market in 2013 and is projected to continue to be the largest market registering a CAGR of 4.7% between 2014 and 2019 in terms of volume. Packaging is the fastest growing application followed by automotive segment. The increasing plastic consumption in the automotive application is expected to benefit plastic additives market over the next five years. Food and beverage manufacturers continue to enhance their focus on attractive and sophisticated product packaging, in order to gain consumer attention. Further, with the advent of new packaging technologies such as antioxidant, UV resistant, heat resistant, antimicrobial, and anti-fog packaging, the usage of plastic additives has surged significantly over the last few years.
Plasticizers segment of plastic additives had the largest market share in 2013 and is projected to dominate the global market by 2019 mainly due to the growth in demand of DOP. The demand for DOP is showing upwards trends owing to its low cost and suitable plasticizing properties that are further employed in various end-use applications. Flame retardants segment is projected to have the highest growth rate between 2014 and 2019. Increasing demand by the consumer goods and construction application especially from Asia-Pacific region will continue to drive the growth of this segment.

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