"Regulatory intervention regarding conventional plastics led to bio-PET development"
The global polyethylene terephthalate (PET) compounding market size was USD 3.95 billion in 2015. Increasing consumption across end-use industries such as packaging, automotive, electrical & electronics and construction is expected to drive growth.
Increasing demand for water bottles is expected to remain a key driver for the market growth. PET bottles are easier to handle, light weight, non-breakable and can be resealed. The compound can be recycled into many products such as winter coats, door panels, industrial strapping, sheet, fibers, and car bumpers.
PET compounds are increasingly used as an alternative to glass & acrylic materials owing to their superior impact resistance. The recent trend of substituting the above stated conventional materials in transportation applications such as windshields & windows is touted to provide lucrative opportunities.
Regulatory intervention regarding usage of conventional plastics in medical devices and food packaging applications have led key manufacturers to develop bio-based alternatives with better biocompatibility. The trend has been a key factor in the development of bio-PET and related compounds.
Global crude oil prices have been witnessing severe fluctuations over the recent past. Social unrest in major crude oil producing regions such as Nigeria, Venezuela, Iraq, Iran, and Libya have adversely affected crude oil supply, thus creating inelasticity in demand and supply balance.
Raw materials used in PET compounding include polymers, plastic additives, lubricants, and solvents. Majority raw materials utilized are produced through downstream processes of petrochemicals and are likely to impact overall production cost. Aforementioned factors are anticipated to hinder growth and challenge industry participants over the forecast period.
Opportunities for recycled plastics in packaging are positioned in the form of traditional applications, such as bottling and non-food product wrapping. Improving logistics networks such as better waste collection and post-recycling supply is expected to positively influence industry growth.
U.S. polyethylene terephthalate (PET) compounding market revenue by application, 2014 - 2024 (USD Million)
"Packaging was the leading application segment for PET compounds in 2015"
Packaging emerged as the dominant application segment where PET compounds are utilized in large quantities for the production of bottles, particularly carbonated beverages and nutritional drinks.
Advancements in packaging technologies and subsequent development in specifications for plastics in packaging applications is expected to emerge as a crucial determinant for shaping market dynamics over the forecast period. Packaging segment was leading application segment in 2014 and is expected to grow at an estimated CAGR of over 7% from 2016 to 2024.
It is extensively used in the electrical & electronics industry owing to superior characteristics such as flexibility, easy processing, and transparency along with barrier properties. Electrical & electronic housing, sockets, wiring components, enclosures, and switches are few of the products generating significant demand for PET compounds.
Industrial machinery components such as processing equipment, heavy duty machinery, and the related tools mostly contain plastic which is used in conjunction with metals. The favorable environment in Asia Pacific in terms of tax incentives for foreign companies is expected to result in an increasing number of manufacturing utilities in the region, thereby prompting the need for industrial machinery.
"Asia Pacific was the leading PET compound market followed by Europe in 2015"
Asia Pacific market accounted for over 35% of the global volume share in 2015. Growing consumer interest in recyclable and sustainable products coupled with the growth of key end-use industries including packaging, automotive and electrical & electronics is anticipated to drive regional market growth.
Expanding food & beverage processing industry, along with an increasing consumer preference toward processed and convenience food is anticipated to boost Latin America market. Developing countries such as Mexico and Brazil are witnessing strong industrial growth along with the surge in demand for polymers. Huge investments in construction and automotive sectors in aforementioned countries are anticipated to augment growth.
North America and Europe market are highly regulated by numerous legislations from environmental agencies such as REACH (Registration, Evaluation, Authorization and Restriction) and EPA (Environment Protection Agency) have compelled manufacturers to shift focus toward bio-based polymers.
Recovery of automotive and construction industries in Europe is another recent development expected to fuel demand in the region. Technological advancements have paved the way for innovative packaging options in processed foods across various categories, thus driving growth in the region.
"The PET compounding market is fragmented in nature"
The polyethylene terephthalate compounding market is highly fragmented with the presence of huge number of small and large scale companies. Major industry participants include Dow Chemical Company, RTP Company, SABIC, LyondellBasell, BASF SE, DuPont, SRP Plastics. Other prominent players operating in the global market include A. Schulman, Polyvisions, Washington Penn Plastics, Covestro and PET Processors LLC.
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