The market for plastic compounds is dominated by a number of key drivers. The building & construction and packaging industries are experiencing increasing demand for plastic compounds for various applications. The energy-efficient construction trend has also boosted demand for plastic compounds for the building construction industry. The United Nations Environment Programme’s Global Status Report for Buildings and Construction report of 2023 reports that in 2022, there was worldwide investment of US$ 285 billion in the energy efficiency of buildings, up by 14% from 2021 .
The Plastic Compounds market is estimated at USD 70.81 billion in 2024 and is projected to reach USD 97.27 billion by 2029, at a CAGR of 6.6% from 2024 to 2029.
There is a growing demand for environmentally friendly and sustainable materials from consumers and businesses. Recyclable plastic compounds are being sought as alternatives to conventional plastic compounds. In 2023, LyondellBasell launched eight new product compounds within their CirculenRecover portfolio, which are designed to assist customers in achieving circularity with their plastic packaging. The CirculenRecover brand offers products containing up to 100% Post-Consumer Resin (PCR) that meet the performance standards for various common applications. These compounds are particularly suitable for industrial and food packaging uses, including rigid and flexible consumer packaging like caps, closures, bottles, and films.
Polyamide is projected to be the fastest growing type of plastic compounds, in terms of value, during the forecast period.
Polyamides, or nylons, are also referred to as high-performance plastics due to their excellent temperature and electrical resistances and suitability in automotive, transportation, consumer goods, textiles, and electrical & electronics applications. Toughness, strength, chemical and heat resistance, flexibility, abrasion and corrosion resistance, thermal insulation, and adhesion are the key properties of polyamide contributing to usage. Increasing usage of polyamide in vehicles to achieve weight reduction will result in increasing polyamide demand in the future. Polyamide enables weight saving in a vehicle without reducing the structural strength and safety. Light vehicles help with improved fuel efficiency and reduced carbon emissions.
Bio-based is anticipated to be the fastest growing, by source, in terms of value, during the forecast period.
Bio-based plastic compounds are produced using renewable biomass feedstocks and present a cleaner alternative to the traditional fossil-based plastics. They are produced from vegetable oil and fat renewable natural raw materials, corn starch, straw, woodchips, sawdust, and food wastes from the food processing industry. Bio-plastics are less dependent on finite and geographically unequally distributed fossil fuel resources, which have environmental and geopolitics costs. Life cycle assessment has shown some bioplastics to be more carbon-efficient than fossil-based plastics, especially when biomass is used both as raw material and as an energy source.
Players operating in the bio-based plastic compounds market are adopting various growth strategies in order to strengthen their market position. For instance, in May 2024, EcoCortec (subsidiary of Cortec Corporation), started its new compounding line for bio-resins at its plant in Beli Manastir (Croatia). The company can now produce a variety of concentrated masterbatch products.
Automotive is anticipated to be the third largest segment, by end-use industry, during the forecast period.
Most of the interior, as well as the exterior parts of a modern vehicle, are made with plastic compounds such as PS, PP, PE, and PET. These plastic compounds are used in dashboards, steering wheels, loudspeaker grills, carpets, and door linings, as well as seats, seat belts, and airbags. The use of plastic compounds in various automotive applications helps reduce vehicle weight and fuel consumption. The increasing replacement of conventional materials such as metals and glass by plastic compounds is driving the market for plastic compounds in this segment. Major players in the plastic compounds sector have greatly expanded their production and introduced new materials to supply to the automotive sector. For instance, in 2023, German thermoplastics compounder Mocom launched light diffusing and light guiding mechanically recycled compounds to its Alcom product line, which it says is the world’s first. Alcom LD (light diffusing) and LG (light guiding) Eco product lines contain up to 100% post-consumer and post-industrial polymer recyclates. Designed specifically for translucent, light-diffusing automotive applications, the products are offered in a range of polymers including PC, MABS, MBS, copolyester, or PMMA. In Mocom’s opinion, the application of mechanically recycled polycarbonate has the potential to decrease Global Warming Potential by up to 80% compared to the use of virgin material.
Middle East & Africa is expected to be the third fastest-growing region in the global plastic compounds market, by region, during the forecast period.
The plastic compounds market has been studied in North America, Europe, Asia Pacific, Latin America, and Middle East & Africa.
The Middle East & Africa is one of the emerging markets globally and provides significant opportunities for plastic compounds manufacturers. This region includes the GCC Countries (Saudi Arabia, the UAE, and Rest of GCC), South Africa, and the Rest of Middle East & Africa. A number of factors, such as growing disposable incomes, expanding industrialization, and swelling population, are likely to propel the plastic compounds market in the region.
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The area experiences volatile industrial growth due to geopolitical reasons and volatile crude oil prices. There is, however, expected growth in emerging GCC economies and the Middle East and North Africa (MENA) that invest heavily in industrial and infrastructural developments. The growing participation of the private sector is also playing an important role in development of various end-use industries. Private companies are being incentivized through public-private partnership (PPP) programs to invest and manage operations in the sector. According to the Gulf Petrochemicals & Chemicals Association (GCPA), Saudi Arabia was the largest polymer resin producer in the region in 2022. The country holds abundant crude oil reservoirs, which ensures a consistent supply of raw materials for the manufacturing of plastic compounds.
Prominent companies include BASF SE (Germany), The Dow Chemical Company (US), LyondellBasell Industries Holdings B.V. (Netherlands), SABIC (Saudi Arabia), Asahi Kasei Corporation (Japan), Covestro AG (Germany), Arkema (France), RTP Company (US), and Westlake Corporation (US).