The plastic additives market is expected to witness a healthy growth, at an estimated CAGR of 5.68% over the forecast period, 2019 to 2024. One of the major factors driving the growth of the market studied is the replacement of conventional materials by plastics in several applications.
- On the flipside, stringent regulations over plastic usage in several countries are restraining the growth of the plastics industry, globally, which is directly affecting the plastic additives demand on the global front.
- The market studied has been segmented on the basis of type, plastic type, application, and geography. By plastic type, polyethylene is likely to be the fastest growing segments among others.
Key Market Trends
Increasing Demand from the Packaging Industry
- The packaging industry mostly relies on polymers for the packaging and decoration of its end-user products. Factors leading to the increased application of polymers in the packaging industry are certain properties of polymers, including lightweight, availability in different colors, low reactivity, chemical, and moisture resistance, etc.
- The usage of suitable plastic additives contributes toward extended lifetime, appearance, thermal protection, clarity, low haze, and improved mechanical properties, which are the most important factors for packaging.
- Major forms of plastics used in the packaging industry are polyethylene terephthalate (PET/PETE), high-density polyethylene (HDPE), polyvinyl chloride (PVC), low-density polyethylene (LDPE), polypropylene, polystyrene, etc.
- One of the main applications of packaging is in the food and beverage industry. With the increase in the awareness toward hygiene and health among the global population, the packaging industry is also growing at a steady pace.
- Packaging of food items is a process that continually responds to the changes in demand and supply, which are the results of adaptations to the varying demands of the consumers, changes in retail practices, technological innovations, and new developments in legislation, especially, with respect to environmental concerns.
- A wide range of additives is available for enhancing the performance and appearance of food packaging, where polymer additives are important areas of innovation for packaging materials.
- All the aforementioned factors, in turn, expected to increase the demand for the PVC during the forecast period.
Asia-Pacific Region to Dominate the Market
- Asia-Pacific region dominated the global market share in 2018. China is one of the lucrative markets for plastic additives, due to the availability of low-cost raw materials and labor. All plastics products are made from essential polymers, mixed with a complex blend of materials, collectively known as plastic additives. China is one of the largest producers of plastic materials in the world, accounting for ~30% of the global plastics production.
- Packaging is the largest end user for the plastics industry, accounting for more than one-quarter of total plastics usage. The rapid development of e-commerce has greatly promoted the development of the packaging industry in the country. With the rise in demand for lighter, cheaper, and more convenient packaging from consumers, the packaging sector in China is set to experience rapid growth, during the forecast period, which, in turn, is expected to boost the plastic additives market.
- For roughly three decades, China's booming economy has offered consumer product companies some of the world's greatest growth opportunities. Attracted by the huge potential of Chinese consumer goods market, many foreign companies have entered China and set up production units. With the growth of consumer goods production, plastic additive consumption may also see increased demand.
- As living conditions continue to improve in China, people are becoming increasingly willing to invest in home decoration. Consumers' increasing purchasing power has majorly boosted the furniture market. Chinese furniture market is increasing, with the emergence of the new middle class population. Plastic additives are used to manufacture plastic furniture.
The market for plastic additives is fragmented in nature, as the top 10 leading players account for only 40% of the market. Major players of the market are BASF SE, ExxonMobil, Evonik Industries, DowDuPont, and Nouryon among others.
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