According to Precedence Research, the global plastic compounding market size is expected to garner around US$ 104.1 billion by 2027, growing at a CAGR of 6.71%
OTTAWA, June 29, 2021 (GLOBE NEWSWIRE) -- The global plastic compounding market size surpassed at US$ 61 billion in 2020. Plastic compounding is a process wherein various materials (polymers and additives) are mixed and melted together, generally in an extruder, which is later pelletized. The material derived through pelleting is later processed into final products (finished or semi-finished).
Plastic compounding involves blending of plastics with additives in the molten phase. In this process of compounding characteristics and properties are altered to match the specification of particular application. The end product produced with this process is known as compound or composite. Polyethylene Terephthalate is the plastic utilized for producing bottle containers employed for carbonated beverages and packaged water. As a raw material, Polyethylene Terephthalate (PET) is knows as a robust, lightweight flexible, safe, non-toxic material which is 100% recyclable. Due to these properties it has attained extensive acceptance. All this advantages in turn are projected to spur the plastic compounding market growth during coming years.
Growing demand of design, more durable, necessity for lightweight and low emission materials are some of the factors that are pushing plastics and polymer sector to cultivate novel and inventive materials. Polymer compound and material improvement occurs in each stage of polymer research and development process to manufacture materials with diver’s equalities, to the base material or to create material with anticipated properties with the help of multiple additives.
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The growth of plastic compounding market is driven by rise in the demand for plastics in construction, automotive, and electrical & electronics sectors. Synthetic polymers such as PVC, PE, PC, PP, and PU have been traditionally used in various applications such as packaging, electronic components, automotive components, toys, furniture, and construction materials. The increase in acceptance of electronic devices is providing opportunities for the use of recycled plastics for producing casings, circuit boards, and other components. These are extensively used in the manufacture of electronic devices for households and vehicles.
Plastic is extensively used in numerous activities of infrastructure sector. Plastic compounding is regularly being utilized to widen the utility and life of outdated building materials, and helps them to function more economically and reliably. Augmented use in the infrastructure area is one of the prominent influencing factors for the growth of plastic compounding market globally. Infrastructure sector is showing tremendous growth on account of rising development of new highways/expressways, airports, modern seaports, multi-modal logistics parks and metro-rail. Government organizations further support the various development activities in the infrastructure sector across the world. There are numerous regulations and rules on the development of roads, airports, highways, and railways to enhance specific country’s economy.
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Major Drivers and Restraints
Stringent regulatory norms, such as EU directives to reduce gross vehicular weight and carbon emissions, have been instrumental in driving the demand for thermosets in automotive components. This is propelling the global plastic compounding market. Three basic ingredients or raw materials, namely polymers, additives, and fillers, are utilized in compounding. Polymers consist of polyamide (PA) compound, polycarbonate (PC) compound, polymethyl methacrylate (PMMA) compound, etc. Prices of plastic compounds have been rising gradually, primarily due to fluctuating petrochemical prices and high substitution potential from their bio-based counterparts. Oscillating petrochemical prices, a source of extraction of plastic, can hamper the plastic compounding market. Fluctuation in prices of crude oil is also adversely affecting the prices of plastic compounds.
In 2020, Asia Pacific surpassed majority of the revenue share of the global plastic compounding market which was around 43%. This growth is on account of augmented applications in numerous sectors including consumer goods, automobiles, electronics, packaging, and construction among others. This region attracted several manufacturers due to low cost labor, economical manufacturing units set up, and cheap raw resources. Certain noticeable players in Asia Pacific have introduced innovative products and broadened their business units. Europe has also appeared as rapidly growing market for plastic compounding. Germany, France, Russia and UK, are the some of the key revenue generating markets in this region. Different federal level agencies including European Commission and European Chemicals Agency (ECHA) have pigeonholed rigorous environmental guidelines related to the consumption and production of the materials. These regulations are pushing players to improve processes and to advance ecological products and technologies.
Key Players & Strategies
Some of the major key players operating in the plastic compounding market are BASF SE, Kingfa Sci. and Tech. Co., Ltd., Asahi Kasei Corporation, Covestro AG, LyondellBasell Industries Holdings B.V., Celanese Corporation, Polyone Corporation, DowDuPont Inc., SABIC, and Solvay SA.
Global plastic compounding market is extremely fragmented with more than 60% share captured by SMEs. Players are speedily intensifying their fabrication competences to amalgamate their market status. This industry has observed noteworthy capacity developments in China due to advent of standalone independent compounders. Backward integration is one of the foremost industry-wide drifts in the compounding business that is also happening in other facets of the plastics sector.
Strategic acquisitions and new production facilities are also identified as major factors that will drive market growth. Continuously rising requirement for resins, polymers, and plastic compounds from multiple end-user sectors including construction, automotive, healthcare, and packaging, consumer and electronics industries among others are further pushing the market growth. Such rising demand for plastic compounds has fortified market participants to develop their market presence with the help of strategic mergers and acquisitions and starting new fabrication facilities. For example, LyondellBasell acquired A. Schulman Inc. in order to upsurge their resin and plastic compounds production. Likewise, RTP Company started new-fangled production facilities in the Poland and US and are scheduling to surge their manufacturing capability of its current facility in Wisconsin, U.S..
By Regional Outlook
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