Plastic Compounding Market

The global Plastic Compounding Market was valued at USD 61.5 Billion in 2022 and is projected to reach a value of USD 99.4 Billion by 2030 at a CAGR (Compound Annual Growth Rate) of 7.1% between 2023 and 2030.

Premium Insights

Plastic Compounding is the process of combining two or more types of plastics and adding other materials, such as pigments, stabilizers, or fillers, to create a new polymer material with improved properties. Plastic materials are more suitable for various applications in end-use industries like automotive, construction, packaging, and electronics thanks to the Plastic Compounding process, which enhances plastic materials' strength, durability, and other properties.

Several factors drive the global Plastic Compounding market growth, including increased demand for lightweight materials, increased use of plastic in the automotive industry, and increased demand for sustainable and eco-friendly plastics. Plastic compounds are increasingly used in the automotive industry due to their lightweight, design flexibility, and cost-effectiveness. In many automotive applications, such as interior and exterior components, engine parts, and electrical components, plastic compounds replace traditional materials such as metal and glass. The demand for sustainable and eco-friendly plastics also propels the Plastic Compounding market forward. Companies are investing in research and development to create sustainable plastics to reduce their carbon footprint and meet the increasing demand for environmentally friendly products. The Plastic Compounding market faces challenges, including rising raw material costs and tightening plastic usage regulations. Plastic usage and disposal regulations are expected to constrain market growth. Moreover, the high cost of raw materials such as polymers, additives, and colorants is expected to impede the Plastic Compounding market growth.

The increasing use of plastic compounds in the 3D printing industry and the growing demand for biodegradable plastics present several opportunities for growth in the Plastic Compounding market. The growing use of plastic compounds in 3D printing propels the Plastic Compounding market forward. Due to their design flexibility, durability, and cost-effectiveness, plastic compounds are suitable for various 3D printing applications, including automotive parts, medical implants, and consumer goods. The growing demand for biodegradable plastics also propels the Plastic Compounding market forward. Companies are investing in research and development to create new and innovative bio-based and biodegradable plastic compounds to meet the growing demand for environmentally friendly and sustainable plastics.

‹›

Report Coverage & Deliverables

PDF report & online dashboard will help you understand:

• Real-Time Data Updates:
• Competitor Benchmarking
• Market Trends Heatmap
• Custom Research Queries
• Market Sentiment Analysis
• Demographic and Geographic Insights

Book Demo

Get Access Now

In recent years, the Plastic Compounding market has seen several developments, including mergers and acquisitions, partnerships, and product launches. For example, LyondellBasell acquired A. Schulman Inc, a leading supplier of high-performance plastic compounds, composites, and powders, in 2022. LyondellBasell's position in the Plastic Compounding market is expected to improve due to the acquisition. In 2020, BASF introduced Ultramid Sustainable, a new product line that offers high-performance plastic compounds made from renewable raw materials such as castor oil. The product line is expected to meet the growing demand for environmentally friendly and sustainable plastics.

Economic Insights

The Plastic Compounding market is a global industry that produces and processes plastic compounds using various polymers and additives. Economic factors such as GDP, inflation, and recession significantly impact the market's demand and supply dynamics. As a result of supply chain disruptions and high demand from the packaging industry, raw material prices have risen. During a recession, the market is likely to see a drop in demand, resulting in lower sales and revenue. Furthermore, inflation can affect the cost of production and demand for plastic compounds, affecting market growth overall.

Top Market Trends

1. Increased Demand for Plastic Compounding in Infrastructure Construction: The increasing number of residential and commercial projects in developing countries is boosting infrastructural development as consumer awareness of appealing interiors grows, increasing demand for these materials in interior design. The expanding construction industry is expected to support the Plastic Compounding market. PVC and CPVC, through various products such as pipes, wires and cables, waterproofing membranes, and wood PVC composites, play an important role in the sustainable management of this sector. Most developing countries, including Mexico, India, and others, are expected to benefit from rising construction spending and consumer preferences for sustainable and lightweight building materials over traditional materials such as metals and alloys.

2. Growing Benefits and Superior Physical Properties of Plastic Compounds: Some plastic products benefit from compounding to prevent the growth of germs on their surface. These plastic additives are mostly used in the production of medical products. However, they may also be compounded to add extra protection against UV rays, which frequently cause material degradation. The benefits of compounded plastics have increased their demand from various end-users and industries, boosting their growth in the global Plastic Compounding market.

3. Rising Preference Shift towards Using Lightweight Materials in Manufacturing Automobile Parts: Regulatory intervention by various governments worldwide to reduce gross vehicle weight and improve fuel efficiency, thereby lowering carbon emissions, has prompted automotive OEMs and spare parts manufacturers to use plastics as a substitute for metals such as steel and aluminum to fabricate automotive components. Plastic Compounding is expected to gain prominence as the demand for thermoplastics and thermosets in automotive component fabrication grows, owing to increasing quality and material specification requirements from automotive OEMs.

4. Multiple and Wide Range Applications Scope of Plastic Compounding: Aside from these applications, various compounded plastics, such as PVC, are commonly used to insulate electrical wiring. In contrast, thermosets withstand high temperatures and heat in switches, light fittings, and handles. Plastics are ideal for housing items such as hairdryers, electric razors, and food mixers, as they protect the user from electric shock. As a result, the global Plastic Compounding market is expected to grow due to its increasing use and broad application scope in industries such as electronics and appliances, packaging, and construction.

Market Segmentation

The global Plastic Compounding market can be categorized as Product, Application, and Region. Based on Product, the market can be categorized into Polyethylene (PE), Polypropylene (PP), Thermoplastic Vulcanizates (TPV), Thermoplastic Polyolefins (TPO), Polyvinyl Chloride (PVC), Polystyrene (PS), Polyethylene Terephthalate (PET), Polybutylene Terephthalate (PBT), Polyamide, Polycarbonate, Acrylonitrile Butadiene Styrene (ABS), and Other Products. Moreover, based on the Application, the market can be divided into Automotive, Building & Construction, Electrical & Electronics, Packaging, Consumer Goods, Industrial Machinery, Medical Devices, Optical Media, and Other Applications. Likewise, based on Region, the market is segmented into North America, Europe, Asia Pacific, Latin America, and Middle East & Africa.

Based on Product

Polypropylene (PP) Leads with the Largest Market Share attributed to its Higher Demands from Automotive Sector

The polypropylene (PP) segment accounted for the largest Plastic Compounding market revenue share in 2022 due to its high demand from the automotive industry. Polypropylene is a lightweight material that is used to make injection molded parts. Its properties include high chemical resistance to organic solvents and corrosive environments, tensile strength, superior working temperature, and low density. These properties improve vehicle fuel economy and lower overall raw material costs. As a result, the growing demand for low-emission and lightweight vehicles in the automotive industry will drive up demand for polypropylene. Polyethylene is a polyolefin resin with flexible, durable, and tear-resistance properties, making it popular in the packaging industry. Several manufacturers use polyethylene for product packaging as it is durable and a barrier between moisture and the product. As a widely used thermoplastic polymer produced by ethylene polymerization, polyethylene (PE) will have the highest CAGR during the forecast period. As a result of its exceptional qualities, including toughness, flexibility, chemical resistance, and electrical insulation, it is a versatile material that can be used in various applications. The PE product segment in the Plastic Compounding market refers to the various types of PE resins compounded with additives and other polymers to produce customized plastic compounds with specific properties for various applications.

Based on the Application

Automotive Sector to Accounts for the Largest Market Share due to the Rising Product Penetration in the Automobiles

During the forecast period, the automotive application segment will dominate the global Plastic Compounding market due to the growing adoption of the product in vehicles. The increasing use of plastics in automotive components as opposed to metals and alloys has been a major factor driving segment growth. In recent years, automotive production has significantly increased, largely driven by the industry's growth and the manufacturing landscape of emerging markets. China, India, and Brazil are the fastest-growing economies and major automobile production hubs. This trend is expected to continue, driving the demand for plastic compounds. The electrical & electronics segment will grow with the fastest-growing CAGR during the forecast period. The expansion of the Asia Pacific electrical and electronics industry resulted from the emergence of small-scale electrical component manufacturers, electronic goods producers, and a versatile manufacturing landscape. Furthermore, government support, the availability of raw materials, and cheap labor are expected to boost the segment's growth.

Based on Region

Asia Pacific to Lead Global Market Revenue Owing to the Growing Regional Product Demands from Multiple End-Use Industries

The global Plastic Compounding market is expected to be dominated by the region of Asia Pacific in terms of growth and revenue. In Asia Pacific, demand for plastic compounds is increasing in end-use industries such as automotive, construction, packaging, and electronics. These industries' expansion drives demand for plastic compounds, which provide design flexibility, durability, and cost-effectiveness. Asia Pacific is also a major consumer and producer of electrical and electronic products such as equipment and wires, which fuels regional Plastic Compounding market demand. Asia Pacific companies heavily invest in R&D to create new and innovative plastic compounds with superior mechanical, thermal, and chemical properties. The region's market is expanding due to a greater emphasis on product innovation. The economic environment and the emergence of plastic manufacturers both favor growth. The region's growing manufacturing sector will drive the region's automotive, industrial machinery, construction, packaging, and electrical & electronics industries. Most regional producers are involved in one or more plastics industry value chain segments.

North America is one of the world's second-largest markets for plastic compounds. Several factors drive this regional market, including the rising demand for plastic compounds from various end-use industries such as automotive, packaging, construction, and electronics. The region has a strong manufacturing base supported by advanced technology and infrastructure, making it an appealing destination for manufacturers of plastic compounds. The automotive industry is a major North American Plastic Compounding market driver. Plastic compounds are increasingly used in the automotive industry due to their lightweight, design flexibility, and cost-effectiveness. In many automotive applications, such as interior and exterior components, engine parts, and electrical components, plastic compounds replace traditional materials such as metal and glass. Furthermore, the North American government is implementing various initiatives and regulations to promote sustainable plastics. For example, the region's ban on single-use plastics is spurring the development of new and innovative bio-based and biodegradable plastic compounds.

Competitive Landscape

The key players in the global Plastic Compounding market include - BASF SE (Germany), LyondellBasell Industries Holdings B.V. (U.S.), DuPont de Nemours Inc. (U.S.), Dow Inc (U.S.), SABIC (Saudi Arabia), Asahi Kasei Corporation (Japan), Covestro A (Germany), Kratom Polymers Inc. (U.S.), RTP Company Inc. (U.S.), S&E Specialty Polymers LLC (U.S.), Dynein GmbH & Co KG (Germany), Washington Penn Plastics (WPP) Co. Inc. (U.S.), Eurostar Engineering Plastic (France), Kuraray Plastics Co. Ltd. (Japan), A. Schulman Inc. (U.S.), Teijin Limited (Japan), LANXESS AG (Germany), Solvay S.A. (Brussels), Heritage Plastics Inc. (U.S.), MRC Polymers Inc. (U.S.), Flex Technologies Inc. (U.S.), Guangdong Silver Age Sci. & Tech. Co. Ltd. (China), China General Plastics Corporation (Taiwan) among others.

Recent Market Developments

• In October 2021, Dow announced investment programs to advance the use of circular plastics. These developments will help reduce plastic waste and greenhouse gas emissions and provide recycled plastics with properties similar to virgin plastics. These advancements will enable the company to supply circular plastics in early 2022.
• In March 2021, LyondellBasell and Sasol disclosed the completion of their joint venture, Louisiana Integrated Polyethylene (LIP), which will use Sasol's technology to produce low-density and linear low-density polyethylene (PP).
• In February 2021, Clariant, a specialty chemicals company, announced the acquisition of Masterbatches do Brazil, a Brazilian pigment and masterbatches producer, to strengthen its position in the South American Plastic Compounding market.
• In January 2021, Celanese Corporation announced plans to acquire Next Polymers Ltd, an Indian engineering thermoplastics compounder, to broaden its Plastic Compounding product offerings and customer base in Asia-Pacific.
• In January 2021, a key player named Celanese Corporation, a worldwide chemical and specialty materials firm, declared a rise in price in the whole plastics engineering category, citing increases in energy, transportation, and raw material prices as well as surged demand for its goods. The company's polyamides and PET costs are expected to climb per kg.
• In May 2019, the capacity of the plastic compounding plant in Altamira was increased by BASF. The company also provided an engineering plastics product line in which the production capacity was increased by 15 KT per annum, including Ultradry and Ultramar. This expansion increased the demand for engineering plastics in Mexico.

Segmentation of the Global Plastic Compounding Market