Plastic Compounding Market Report

Plastic Compounding Market Analysis By Product (Polyethylene, Polypropylene, TPV, TPO, PVC, Polystyrene, PET, PBT, Polyamide, Polycarbonate, ABS), By Application, And Segment Forecasts, 2014 - 2026

Published: July 2017  |  225 Pages  |  Format: PDF  |  Report ID: 978-1-68038-446-8

Industry Insights

The global plastic compounding market size was estimated at 26.73 million tons in 2016. Growing substitution of metals & alloys with lightweight plastic counterparts is a key factor influencing consumption patterns in the industry.

The industry relies heavily on advanced technologies since critical requirements from developing end-use industries has led to high demand for material versatility, which may overshadow consumption dynamics. Other factors such as feedstock availability, production process, and socio-political events have also had a significant impact on the production landscape in recent years.

U.S. plastic compounding market revenue by product, 2014 - 2026 (USD Million)

U.S. plastic compounding market

Automotive, packaging, consumer goods, and industrial machinery are prime growth application segments. On the automotive front, regulations regarding vehicular weight reduction and fuel efficiency have been instrumental in driving plastics compounds demand.

Emerging economies in Asia Pacific such as China and India have witnessed exponential growth in manufacturing activities & industrial output owing to the considerable rise in consumerism. This is largely driven by economic growth, favorable credit landscape, and rising disposable income among other factors.

Key raw materials such as polypropylene (PP) and polyethylene (PE) are witnessing tremendous growth on account of increasing consumption in the automotive, packaging & construction industries. Feedstock prices have risen considerably primarily on account of fluctuating petrochemical prices, and high substitution potential from its bio-based counterparts. The high price increase is expected to from polyvinyl chloride (PVC) which is being utilized for diverse industrial applications.

Technological innovations are expected to facilitate faster & more efficient production over the near future, as the industry shifts away from conventional batch mixers towards more modern options such as tumbler, convective and fluidization blenders. Intense rivalry in production lines now necessitates durable equipment capable of flexibility, rapid blend times, reduced power consumption, ease of maintenance and a plethora of customized features.

Additionally, modern mixers and compounding equipment are now designed to combine multiple process steps into single equipment, including heat transfer, drying, granulation and coating among others. These factors are expected to remain key factors shaping industry dynamics over the forecast period.

However, challenges in the form of stringent regulations compelling manufacturers to shift away from hazardous chemicals and non-biodegradable materials are expected to hamper growth. The advent of bio-based plastics may present lucrative prospects for those manufacturers that remain proactive & capitalize on these opportunities.

Product Insights

PP was the leading product with volume share estimated at over 32% in 2016. These compounds are widely used across the automotive, electrical & electronics industries for various applications ranging from fascia & side moldings to modular switches.

PP compounds were followed by polyethylene (PE) segment which accounted for 22.4% of the overall volume in 2016. PE compounds are commonly used in construction, packaging and electrical & electronics industries. Major construction applications of PE compounds include steel pipe coating, pipe fittings, tank & reservoir substances, geo-textiles and roof tiles.

In 2010, plastics and metals accounted for 16% and 61% of vehicular weight respectively. Numerous OEMs are incorporating lightweight products such as PVC, into automobiles to increase fuel efficiency & curb carbon emissions. Polyethylene terephthalate (PET) is also anticipated to remain a large segment on account of their high consumption in packaging, especially for bottles & containers.

Other products such as thermoplastic vulcanizates (TPV), thermoplastic olefins (TPO), polybutylene terephthalate (PBT) and polycarbonate among others occupy smaller shares in the industry, yet form an important component for innovation in end-use industries.

Application Insights

Automotive emerged as the leading application with over 24% of the overall volume in 2016. Various plastics are used in the manufacturing of automotive components that range from windshields to drive systems. Regulations in Western markets that include EU and the U.S. which are aimed at vehicular weight reduction have been the primary driving force for rising consumption.

Electrical & electronics application held 18.15% of the market volume share in 2016. Plastics are used in a wide array of electrical applications such as semiconductors, housings, enclosures, sockets, and switches. Increasing requirement for flame retardancy, heat resistance and improved serviceability in manufacturing materials is likely to drive their demand in the sector.

Global plastic compounding market volume by application, 2016 (%)

Global plastic compounding market

Conventionally, the construction sector has been a major consumer with their applications ranging from pipe fittings & insulation to masonry materials & equipment. Plastic compounds are modified in accordance with their requirements, such as the incorporation of flame retardant additives to PVC compounds, and form a very crucial aspect of building materials. The segment is thus likely to remain a dominant application over the near future.

Packaging also forms an important application, since products such as PVC, polycarbonate, polyamide and even polystyrene are widely utilized in the sector for films, laminates, and other goods including boxes, containers, and bottles. Innovation in the form of rapid manufacturing techniques is also driving plastics demand as they foster quicker speed at a low cost.

Other applications such as industrial machinery, medical devices and even consumer goods that occupy a smaller share of the market, are anticipated to witness lucrative growth as a result of innovation & intensive R&D to introduce new products with enhanced performance characteristics.

Regional Insights

Asia Pacific emerged as the largest consumer, occupying nearly half of the volume share in 2016. Favorable economic environment and emergence of several SMEs have aided in the region’s development over the past. China, a major manufacturing hub, has been witnessing tremendous growth of end-use industries that consume plastic compounds.

Europe is characterized by numerous restraining factors such as sovereign debt crisis, sluggish industrial output in EU-27, the eminent post-Brexit crisis, and ageing demographics. Automotive manufacturing in the region which was previously dominant across Germany, Italy, France, Spain and UK is currently shifting towards eastern European markets such as Slovakia, Romania and Czech Republic.

North America is characterized by technologically advanced manufacturing bases, high consumer awareness, and a versatile end-user landscape. The region remains a small yet prominent segment in the global industry. The U.S. is a major consumer with growth to be driven primarily by a rebounding automotive and construction (residential housing) sector.

Competitive Insights

The industry is extremely fragmented with only a portion of the market share allocated to key multinationals including such as BASF, SABIC, The Dow Chemical Company, LyondellBassell Industries, DuPont, A. Schulman and others. A majority of the share is occupied by smaller and medium sized players that have are extending their operations towards emerging Asian economies with lower feedstock prices and larger consumer bases.

The competition between companies attempting to gain traction in the fast-developing plastics sector is waging across multiple arenas. Numerous participants are thus focusing on the introduction of inexpensive compounds and techniques for processing the same in line with growing consumer price-sensitivity and awareness.

Report Scope

Attribute

Details

Base year for estimation

2016

Actual estimates/Historical data

2014 - 2016

Forecast period

2017 - 2026

Market representation

Volume in kilo tons, revenue in USD Million and CAGR from 2017 to 2026

Regional scope

North America, Europe, Latin America, Asia Pacific, Middle East & Africa

Country scope

U.S., Canada, Germany, Russia, Mexico, Brazil, China, India, Japan, Saudi Arabia

Report coverage

Revenue forecast, company share, competitive landscape, growth factors and trends

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Segments covered in the report

This report forecasts revenue growth at global, regional & country levels and provides an analysis on the industry trends in each of the sub-segments from 2014 to 2026. For the purpose of this study, Grand View Research has segmented the global plastic compounding market on the basis of product, application and region:

  • Product Outlook (Volume, Kilo Tons; Revenue, USD Million, 2014 - 2026)

    • Polyethylene

      • Automotive

      • Construction

      • Electrical & Electronics

      • Packaging

      • Others

    • Polypropylene

      • Automotive

      • Electrical & Electronics

      • Consumer Goods

      • Industrial Machinery

      • Others

    • TPV

      • Automotive

      • Industrial Machinery (Fluid Handling)

      • Consumer Goods

      • Medical Devices

      • Others

    • TPO

      • Automotive

      • Industrial Machinery

      • Construction

      • Others

    • PVC

      • Construction

      • Consumer Goods

      • Packaging

      • Electrical & Electronics

      • Automotive

      • Others

    • Polystyrene

      • Packaging

      • Electrical & Electronics

      • Construction

      • Medical Devices

      • Others

    • PET

      • Packaging

      • Electrical & Electronics

      • Industrial Machinery

      • Others

    • PBT

      • Automotive

      • Electrical & Electronics

      • Consumer Goods

      • Others

    • Polyamide

      • Automotive

      • Electrical & Electronics

      • Industrial Machinery

      • Consumer Goods

      • Others

    • Polycarbonate

      • Automotive

      • Electrical & Electronics

      • Construction

      • Packaging

      • Consumer Goods

      • Optical Media

      • Others

    • ABS

      • Automotive

      • Electrical & Electronics

      • Consumer Goods

      • Others

    • Others

      • Automotive

      • Construction

      • Electrical & Electronics

      • Packaging

      • Consumer Goods

      • Industrial Machinery

      • Others

  • Application Outlook (Volume, Kilo Tons; Revenue, USD Million, 2014 - 2026)

    • Automotive

      • Polyethylene

      • Polypropylene

      • TPV

      • TPO

      • PVC

      • PBT

      • Polyamide

      • Polycarbonate

      • ABS

      • Others

    • Construction

      • Polyethylene

      • TPO

      • PVC

      • Polystyrene

      • Polycarbonate

      • Others

    • Electrical & Electronics

      • Polyethylene

      • Polypropylene

      • PVC

      • Polystyrene

      • PET

      • PBT

      • Polyamide

      • Polycarbonate

      • ABS

      • Others

    • Packaging

      • Polyethylene

      • PVC

      • Polystyrene

      • PET

      • Polycarbonate

      • Others

    • Consumer Goods

      • Polypropylene

      • TPV

      • PVC

      • PBT

      • Polyamide

      • Polycarbonate

      • ABS

      • Others

    • Industrial Machinery

      • Polypropylene

      • TPV

      • TPO

      • PET

      • Polyamide

      • Others

    • Medical Devices

      • TPV

      • Polystyrene

    • Optical Media

      • Polycarbonate

    • Others

      • Polyethylene

      • Polypropylene

      • TPV

      • TPO

      • PVC

      • Polystyrene

      • PET

      • PBT

      • Polyamide

      • Polycarbonate

      • ABS

      • Others

  • Regional Outlook (Volume, Kilo Tons; Revenue, USD Million, 2014 - 2026)

    • North America

      • U.S.

      • Canada

    • Europe

      • Germany

      • Russia

    • Asia Pacific

      • China

      • India

      • Japan

    • Central & South America

      • Mexico

      • Brazil

    • Middle East & Africa

      • Saudi Arabia 

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