Technical Papers Plastics
Bio-based polymers to augment global plastic compounding market growth at CAGR of 5.9% uptil 2022

Bio-based polymers to augment global plastic compounding market growth at CAGR of 5.9% uptil 2022

29-Jul-15

Plastic compounding market is expected to grow to US$661.65 bln by 2022 from US$419.14 bln in 2014, growing at a CAGR of 5.9% from 2015 to 2022, as per a report By Grand View Research, Inc. Development of Bio-based polymers is expected to augment market growth, while increasing plastics demand across automotive, construction and electrical & electronics industries is expected to drive the market over the next seven years. Regulatory intervention to reduce gross vehicle weight in order to improve fuel efficiency and ultimately reduce carbon emissions has driven automotive OEMs to adopt plastics as substitute to metals such as steel and aluminum for fabricating automotive components. With growing plastics demand in automotive component fabrication, plastic compounding is expected to gain prominence due to increasing quality and material specification requirements from automotive OEMs. Increasing construction spending in emerging markets coupled with rapid growth in construction industry in Africa is expected to further complement global plastic compounding market growth over the next seven years. Shift in trend towards substituting glass and metal with plastics across various end-use industries is also expected to have a positive influence on the market growth. Rapid industrialization and urbanization in emerging markets of Asia Pacific and Latin America are expected to fuel construction activities. This in turn is expected to provide growth opportunities to market participants.

There are three basic ingredients or raw materials, namely polymers, additives, and fillers, utilized in the production of plastic compounds. Polymers generally consist of PP (polypropylene) which may be categorized into homopolymers or block copolymers. PE (polyethylene) is also used in production of plastic compounds, along with certain elastomers. Prices of plastics have been rising gradually primarily due to fluctuating petrochemical prices, and high substitution potential from its bio-based counterparts. Global plastic compounding market is regulated by environmental agencies and plastics association that constantly update and develop recycling norms, application scope & utilization quantity, and environmental policies. Carcinogenic nature and non-biodegradability of certain plastics have been under constant scrutiny from regulatory bodies. This factor is expected to challenge plastic compounding market growth over the next seven years.

Olefins is a major plastic product consumed in compounding and accounted for over 50% of the overall plastic compounding market volume in 2013. High demand for polyethylene, particularly LDPE, in packaging and transportation is has been a major factor contributing towards olefins demand. High demand for polypropylene in automotive components, electrical components and consumer goods has further strengthened olefins demand over the recent past. Positive outlook towards oil drilling and extraction activities is expected to drive olefins compounding demand over the forecast period. Increasing R&D initiatives to develop bio-based olefins is also expected to provide key opportunities for market growth. PET is expected to register high demand growth over the forecast period owing to its increasing its growing incorporation in glass particles and fibers that find usage in construction, consumer goods and automotive industries.

Global plastic compounding market volume by product, 2012 – 2022, (Million Tons)
plastic-compounding-market

Plastic compounding market has been segmented into North America, Europe, Latin America, Asia Pacific and Middle East & Africa. Asia Pacific was the leading regional market and accounted for over 45% of the total market volume in 2014. Rapid industrialization and growing population have contributed to economic growth in China and India. With increasing workforce and subsequent industrial infrastructure development in the region, major industries such as automotive, construction, electrical & electronics and consumer appliances have witnessed rapid growth. On account of the above stated, plastics consumption in these industries have risen drastically over the recent past. These trends have been instrumental in driving the regional plastic compounding market. Latin America is expected to witness highest growth rate over the forecast period due to increasing construction spending in Mexico and Brazil to meet industrial as well as public infrastructure needs. Rapidly evolving transportation sector and rising automotive production in the region is expected to further complement plastic compounding market over the forecast period.
Global plastic compounding market is highly concentrated with top four companies accounting for over 75% of the total market share in 2014. Major companies have established supply partnerships in order to reduce overall production costs. Other chemical companies such as DuPont and Ferro Corp. have integrated to produce polymers, additives, and other materials required for compounding. Local compounders in the market operate through contract manufacturing i.e., they procure plastics and related materials to compound plastics for end-users. Key market participants in the global market include BASF, LyondellBasell, Kingfa, DuPont, RTP Company, A. Schulman, Bayer MaterialScience, Lanxess, Kraton Polymers, Dow Chemical Company and Solvay Plastics.
Further key findings from the study suggest:

  • Global plastic compounding market demand was 230.22 mln tons in 2014 and is expected to reach 332.08 mln tons by 2022, growing at a CAGR of 4.7% from 2015 to 2022.
  • Automotive emerged as the leading application segment and accounted for 33.7% of total market volume in 2014. Plastic composites have 85% less specific gravity compared to metals and can make up to 80% weight savings and 30-50% cost savings in individual components. Plastics are extensively being preferred over metals in automotive applications owing to superior impact strength, easy moldability, improved aesthetics, scratch resistance, cabin insulation, recyclability and being lightweight. Currently, an average car consists of around 10-15% plastics of total curb weight and increasing regulatory intervention is expected to drive plastics composition to approximately 18% by 2020. This trend is expected to drive plastic compounding market growth in automotive industry.
  • Construction is expected to register highest plastic compounding demand growth over the forecast period. Increasing plastics demand in high performance safety windows, floorings, storage tanks, insulation materials, roofing, domes/sky lights, pipes, doors and cables is expected to complement plastic compounding market growth in construction industry.
  • Global plastic compounding market is fairly concentrated in nature with top four companies accounting for over three quarters of the overall market share. However, large number of small compounders particularly in Asia Pacific poses threats to these multinational corporations in terms of their price and service offered. Major companies operating in the global market include LyondellBasell, Kingfa, DuPont, A. Schulman, Bayer, Kraton Polymers, BASF and Dow Chemical Co.
  Back to Articles
{{comment.Name}} made a post.
{{comment.DateTimeStampDisplay}}

{{comment.Comments}}

COMMENTS

0

There are no comments to display. Be the first one to comment!

*

Name Required.

*

Email Id Required.

Email Id Not Valid.

*

Mobile Required.

Email ID and Mobile Number are kept private and will not be shown publicly.
*

Message Required.

Click to Change image  Refresh Captcha

pmmai

telluswhatyouwant

used-plastics-Machinery-required

Direct fill ball pen plant

Direct fill ball pen plant