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Increasing environmental awareness, government intervention promote growth in plastic additives market

Increasing environmental awareness, government intervention promote growth in plastic additives market

29-Jul-15

The global plastic additives market will grow at a CAGR of 5.2% between 2013 and 2019, and will reach a market value of US$15.9 bln by 2019, as per Transparency Market Research. According to the report, flourishing industries such as construction, consumer appliances, and automotive drive this market. Surging demand for plastics and rising energy concerns are the other significant factors stimulating demand for plastic additives. Extensive application of plastic additives in a range of end-use products can be attributed to the capacity of plastic additives to provide versatility to the products. The expanding plastic additives market has a positive impact on the oil and gas industry, since the former depends exclusively on the latter for the supply of raw materials. The surge in the demand for plastic, to be utilized in a number of end-use products, is likely to trigger the growth of the global plastic additives market. On the other hand, the high cost associated with the raw materials of plastic additives is a major concern for the players in the global plastic additives market. However, the return on investment in the industry is very high, which in turn is likely to assist market participants in overcoming this issue and thus drive the global market for plastic additives. Additionally, rules and regulations pertaining to the environmental effect of the use of plastics affects the market adversely to a significant extent. Plastic additive producers are always under pressure to produce eco-friendly chemicals that are safer than the existing ones. A wide range of plastic additives has been banned in recent years, impacting the market remarkably.
Product-wise, this market is segmented into UV stabilizers, antimicrobials, antioxidants, impact modifiers, flame retardants, and plasticizers. Property modifiers mostly include impact modifiers, biodegradable plasticizers, antioxidants, blowing agents, antimicrobials, and flame retardants. The market for plasticizers is reporting the fastest growth among all property modifiers. With a market share exceeding 50%, the segment of plasticizers dominates the global plastic additives market in terms of volume. The global plastic additives market is spread across North America, Europe, Asia Pacific and the Rest of the World. Fuelled by the growth of the construction industry and the automobile industry, Asia Pacific dominates the market in terms of both consumption and production. The automobile industry in India and China is expected to expand robustly in the forthcoming years, which in turn will increase the demand for plastic additives. Furthermore, the market is anticipated to witness high demand from Europe and the USA because of the steady economic recovery taking place in these regions. Of the key companies operating in this market, BASF continues to be the largest manufacturer of plastic additives in the global market. Kaneka, Chemtura Corporation, Bayer AG, and Exxon Mobil Corporation are the other prominent companies in the global plastic additives market. Brazil, Korea, Saudi Arabia, Russia, India, China and Iran are some of the lucrative regions in the global plastic additives market that will prosper significantly during the forecast period.

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. 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. The US is currently the largest plastic additives consumer in the world but is anticipated to be outdone 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 will continue to drive the growth of this segment.

Plastics additives are substances that are added in a polymer during reaction in the final stage or in the process of polymer/plastic production. These additives help in improving the characteristics of polymers such as strength, shine, durability and heat sensitivity. The global plastic additives market is expected to generate revenue of US$57.8 bln by 2020 at a CAGR of 4.9% during 2013-2020, as per Allied Analysts LLp. In terms of volume, it is expected to reach 17,071.7 Kilo Tons by 2020 growing at a CAGR of 4.4% during 2013-2020. Impacting drivers of plastic additives market such as increase in environmental awareness and intervention by government to promote non-toxic plastic additives is promoting growth. However, increase in health concerns due to consumption of Phthalate 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).
Decreasing mineral ore sources have increased the cost of metal equipment, which has triggered the application of plastics to replace the metal equipment. The low cost of plastic equipment and properties that match metal equipment is also pushing the higher adoption of plastics in a number of applications. Thus the demand for additive which enhances the properties of plastics is also on rise. The companies involved in manufacturing of additives are majorly concentrating on specialty chemicals that are used in construction and automobile equipment. The global plastic additives market growth is dampened by strict government regulations as some plastics additives such as chlorinated flame retardant are banned in countries, namely Canada, US and the European Union. The pending legal suits are also hindering the growth of plastic additive market. Companies are facing problems with lawsuits such as patent imitation suit, commercial application of banned product etc.

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