Plastic Compounding Market Size, Share & Trends Report

Plastic Compounding Market Size, Share & Trends Analysis Report By Product (PP, PET, TPV, TPO, PVC, PBT, ABS), By Application (Automotive, Electrical & Electronics, Construction), And Segment Forecasts, 2019 - 2026

  • Published Date: May, 2019
  • Base Year for Estimate: 2018
  • Report ID: 978-1-68038-446-8
  • Format: Electronic (PDF)
  • Historical Data: 2014 - 2017
  • Number of Pages: 208

Industry Insights

The global plastic compounding market size was estimated at USD 56.86 billion in 2018 and is projected to expand at a CAGR of 6.7% from 2019 to 2026. Increasing substitution for glass, metals, wood, natural rubber, and man-made materials, such as concrete, is anticipated to drive the growth. The demand for plastic is rising owing to the various industrial applications due to its versatile benefits, easy molding, and ability to form desired shape.

Plastic compounding involves an elaborate process with various stages such as determining additives ratio, high speed mixing via twin screw extruders, melt mixing, and cooling, before final pellet cutting and packaging. There is a diverse range of products available, depending on the additives and fillers integrated while processing the polymers including antioxidants, processing aids, colorants, wear-resistant, blowing agents, lubricants, fillers and reinforcements, antistatic agents, slip/anti-slip agents, anti-block agents, flame retardants, light stabilizers, impact modifiers, and cross linking agents.

US plastic compounding market

Europe is the third largest market owing to high demand in automotive followed by electrical and electronics and construction sectors. Germany was the leading plastic manufacturer in Europe in 2018. The country is self-sufficient in plastic production with adequate number of plants and production capacity required to fulfill local demand. Moreover, the country supplies PET, PVC and other products to neighboring countries due to high quality and large production base. The country is also recycling a significant amount of waste plastic into various products such as fibers, sheet, and film among others.Germany is setting the international standards as a key plastic industry located in Europe, with the country’s leading edge network of chemical parks, industrial infrastructure, and unique cluster concept, providing industry players for accessing all the parts of plastic industry value chain swiftly.

Future supply and demand changes are also expected to keep prices of plastics very volatile in all global markets. Most raw materials are produced through downstream processes of petrochemicals. Volatility in crude oil prices is due to political instability, supply and demand imbalances, and seasonal variations.Additionally, the market is highly integrated from raw material procurement to distribution channels. Major companies have established supply partnerships to reduce overall production costs. Such factors are anticipated to have a large impact on the prices of plastic compounding.

The depleting crude oil reserves and environmental concerns due to the usage of petrochemical polymers have propelled the demand for bio-based products. Government restrictions on consumption of polymers derived from petrochemicals in different end use industries is expected to further incentivize bio-based polymers production. Polymers derived through bio-based sources such as Polylactic Acid (PLA), Polybutylene Succinate (PBS), and Polyhydroxyalanote (PHA) show remarkable biodegradability that their petrochemical-derived counterparts lack. These products are widely being accepted in biomedical and agricultural application.

Product Insights

Polypropylene (PP) held the largest market share in terms of volume in 2018. Its compounds are largely used in automotive applications owing to its high impact resistance and serviceability. Economic growth in Asian and Latin American markets has propelled growth in automotive sector both in terms of vehicle sales and domestic production. Considering ever increasing automotive production along with regulatory trends compelling manufacturers to reduce vehicular weight and improve fuel efficiency; plastics consumption in automotive applications shall rise considerably over the forecast period.It has good fatigue resistance and better chemical and temperature resistance. These factors have made PP a popular material in developed economies and emerging economies alike for multiple applications.

Increasing construction spending in Asia, Middle East, and Latin America is expected to provide growth opportunities for PVC compounds considering relatively lax regulatory intervention regarding the presence of plastics in building materials.Recent trend of developing PVC through bio-based sources have been successful, such as the recently introduced Dow Chemical’s Ecolibrium plasticizer, shall have a positive influence on PVC compounds growth over the forecast period.

Application Insights

Automotive is anticipated to lead the application segment over the forecast period. Increasing incorporation of plastics as opposed to metals and alloys in automotive components has been a major factor for the growth of the segment. Over the recent past, there has been a considerable rise in automotive production, which is largely driven by growth of the industry and manufacturing landscape of emerging markets. China, India, and Brazil, are the fastest growing economies and are also the major production hubs for automobiles. This trend is expected to continue over the future, thus driving demand for compounded plastics.

global plastic compounding market

Asian markets have been registering an above average industrial output when compared to their Western counterparts over the recent past. Companies based in the western markets are gradually increasing their presence in Asia to capitalize on growth prospects. Also, a favorable environment in Asia that promotes small scale enterprises to develop and government driven tax incentives for foreign corporations are expected to increase sales of industrial machinery and equipment. Companies manufacturing these machineries tend to channel their businesses locally, i.e., establishing manufacturing units closer to their customer bases. These factors are likely to increase consumption of plastic compounds in industrial machinery over the forecast period.

Regional Insights

Asia Pacific emerged as the largest region in 2018 favored by economic environment and emergence of plastic manufacturers.Growing manufacturing sector shall drive the demand from automotive, industrial machinery, construction, packaging, and electrical and electronics industries in the region.It is the largest producer and consumer of automobiles, consumer goods, and packaging materials that paved a way for the regional market growth. Most of the producers are involved in roughly one of the segments of the plastic industry value chain. APAC is also one of the largest consumer and producer of electrical and electronic products, such as equipment and wires among others, which further fuel the regional demand.

On the other hand, Europe is likely to remain a saturated market with slightly positive aspects in Central and Eastern European countries.Various federal level agencies and others such as ECHA, European Commission have characterized stringent environmental regulations in Europe with regards to production and consumption of the materials. These regulatory policies however challenging might they be for growth, are in a way expected to aid industrial development as they tend to push manufacturers to optimize processes and to develop sustainable technologies and products.

Plastic Compounding Market Share Insights

The global market is highly fragmented in nature with over 60% share occupied by Small and Medium Enterprises (SMEs).Companies are rapidly expanding their production capabilities to consolidate their market position.The industry has witnessed significant capacity expansions in China with the emergence of standalone independent compounders.Unlike major end-use corporations such as automotive manufacturers and OEMs who establish strategic agreements with compounders or extend their capabilities towards compounding, Chinese compounders cater to a large pool of medium enterprises.

Some of the key market participants are BASF SE, LyondellBasell Industries, N.V., and The Dow Chemical Company. The other manufacturers are SABIC, Asahi Kasei Plastics and Covestro (Bayer Material Science).

Report Scope

Attribute

Details

Base year for estimation

2018

Actual estimates/Historical data

2014 - 2017

Forecast period

2019 - 2026

Market representation

Volume in kilotons, Revenue in USD Million & CAGR from 2019 to 2026

Regional scope

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

Report coverage

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

Country Scope

U.S., Canada, U.K., Germany, France, Italy, China, India, Japan, South Korea, Brazil

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Segments Covered in the Report

This report forecasts revenue growth at global, regional, and country level and provides an analysis of the latest 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 report on the basis of product, application, and region:

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

    • Polyethylene

    • Polypropylene (PP)

    • Thermoplastic Vulcanizates (TPV)

    • Thermoplastic Polyolefins (TPO)

    • Poly Vinyl Chloride (PVC)

    • Polystyrene

    • Polyethylene (PET)

    • Polybutylene Terephthalate (PBT)

    • Polyamide

    • Polycarbonate

    • Acrylonitrile Butadiene Styrene (ABS)

    • Others

  • Application Type Outlook (Volume, Kilotons; Revenue, USD Million, 2014 - 2026)

    • Automotive

    • Construction

    • Electrical & Electronics

    • Packaging

    • Consumer Goods

    • Industrial Machinery

    • Medical Devices

    • Optical Media

    • Others

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

    • North America

      • U.S.

      • Canada

      • Mexico

      •  Europe

    • Germany

      • UK

      • France

      • Italy

      • Netherlands

    • Asia Pacific

      • China

      • India

      • Japan

      • South Korea

    • Latin America

      • Brazil

      • Argentina

    • Middle East & Africa

      • Saudi Arabia

      • South Africa

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