The global plastic compounding market was valued at around US$ 60,000.0 Mn in 2018 and is anticipated to expand at a CAGR of more than 5.0% from 2019 to 2027, according to a new research report published by Transparency Market Research (TMR) titled ‘Plastic Compounding Market – Global Industry Analysis, Size, Share, Growth, Trends, and Forecast, 2019–2027.’ Rise in demand for plastic compounds in automotive and electrical & electronics industries is driving the global plastic compounding market. Asia Pacific accounted for dominant share of the global plastic compounding market in 2018. In terms of demand, China held major share of the market in the region in 2018. The plastic compounding market in Asia Pacific is expected to expand at a CAGR of around 6.0% during the forecast period.
Increase in Demand for Low Emission Products in Automotive Applications and Rise in Demand for Lightweight Vehicles
International legislations and automotive OEMs have identified the need to reduce odor, fogging, and Volatile Organic Compounds (VOCs) in order to improve air quality and safety of vehicle interiors. Of late, plastic compounders have been focusing on meeting the rising demand for low emission products in automotive interiors. These low emission products blended in plastic compounds conform to Original Equipment Manufacturer (OEM) mandates to reduce the VOC levels. Implementation of stringent regulations against the usage of VOCs in automotive applications is anticipated to boost the plastic compounding market during the forecast period. Furthermore, plastic compounds possess light-weighing properties that result in weight reduction of vehicles. This ultimately lowers fuel consumption. Thus, weight reduction in automotive vehicles enhances fuel efficiency and performance. Increase in production of such lightweight vehicles is estimated to augment the global plastic compounding market during the forecast period.
Rise in Demand for Plastic Compounds in Electrical & Electronic Component Manufacturing
Plastic compounds play a vital role in manufacture and assembly of electrical and electronic devices. They offer reliability to applications that require protection from electrostatic discharge, dissipation of static charges, and effective thermal management. Products manufactured from plastic compounds are lightweight, recyclable, and corrosion-resistant parts that protect against damage to dissipation of static charge in electronic applications. Plastic compound material and its processing is contributing to lower costs and performance enhancement of consumer and industrial electronics manufacturing technologies. Increase in usage of plastic compounds in the electrical & electronics industry due to their exceptional attributes is projected to drive the global plastic compounding market during the forecast period.
Asia Pacific Dominates Global Plastic Compounding Market
Based on region, the global plastic compounding market has been divided into North America, Europe, Asia Pacific, Latin America, and Middle East & Africa. In terms of value, Asia Pacific led the global plastic compounding market in 2018. China is the major manufacturing hub for automotive and electronics industries. The country constituted prominent share of the market in the region in 2018 owing to the high rate of adoption of plastic compounds in automotive and electrical & electronics applications. Major manufacturing companies producing automotive components and electronic devices are relocating from the U.S. and countries in Europe to East Asia. Key players are focusing on expanding their production facilities in Asia Pacific to cater to the rising demand for plastic compounds in several end-use industries in the region. These players are also introducing new production plants in India, Indonesia, and Vietnam. The plastic compounding market in North America and Europe is likely to expand at a moderate pace during the forecast period. Advancement in research & development activities among universities and compound manufacturers in North America and Europe is expected to propel the plastic compounding market in these regions.
Prominent players operating in the global plastic compounding market are BASF SE, RTP Company, Ravago Group, SABIC, LyondellBasell Industries Holdings B.V., DowDuPont Inc., Mexichem Specialty Compounds Inc. (Mexichem S.A.B. de C.V.), Coperion GmbH, Adell Plastics, Inc, Sojitz Corporation, Polyvisions Inc, Celanese Corporation, Covestro AG, Teknor Apex, Trinseo LLC, Asahi Kasei Corporation, Mitsui Chemicals, Inc., KRATON CORPORATION, Kuraray America, Inc., and KRAIBURG. The plastic compounding market is moderately fragmented and highly competitive. Companies operating in the market focus on growth strategies, such as merger & acquisition activities, in order to strengthen their product portfolio and enhance market share. Ongoing research & development activities among these players intending to upgrade the behavioral properties of plastic compounds are anticipated to drive the market in the near future.