The plastic additives market is set for substantial growth driven by the increasing urban population, which fuels demand in the automotive and transportation industries. According to a United Nations (UN) report, urban areas currently house approximately 55% of the global population, a figure expected to rise to 68% by 2050. This urban shift has escalated lifestyle changes and globalisation, boosting the packaging industry and subsequently the plastic additives market. The popularity of convenience foods has spiked demand for food-grade plastic used in packaging, further driving market growth. The e-commerce boom worldwide is another significant factor propelling the packaging sector, which in turn supports the plastic additives market.
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Strategic Acquisitions Bolster Market Position
In March 2021, REPI, a provider of high-performance liquid, colour, and additive solutions, acquired Novosystems GmbH, a European player in liquid colours and additives. This acquisition strengthens REPI’s position in the polyurethanes and plastics markets, expanding the Group's geographical footprint in Northern and Central Europe. The renewable sector's expansion is also supporting the growth of the plastic additives market. Growing awareness and concern about pollution and the accumulation of plastic in soils and water bodies have spurred market expansion. Government regulations aimed at reducing non-biodegradable plastic usage have significantly influenced the market dynamics.
Innovations in Recycling and Biodegradability
Evonik, in December 2019, shifted its focus to developing solutions for plastic and rubber recycling. Vestoplast, one of Evonik's additives, is set to become a primary product for recycling, involving breaking down into its component monomers. Similarly, Biotec Environmental has developed EcoPure, an organic additive that enhances the biodegradability of traditional polymer products. These innovations signify a growing trend towards sustainability in the plastic additives market.
Increased Demand for Plastic Additives in Packaging Industry
Rapid urbanisation, changing consumer lifestyles, economic trends, rising health awareness, and advancements in packaging material and technology are major factors fuelling the packaging industry's growth. Plastics' properties, such as durability, low cost, resistance to corrosion, water, and chemicals, and low thermal conductivity, make them suitable for a wide range of applications. The increased use of plastics in heavy and light packaging drives the demand for plastic additives like plasticisers, flame retardants, and stabilisers.
Asia Pacific: A Hub for Market Growth
Asia Pacific is expected to hold a significant market share due to the presence of numerous manufacturers in the region. The expanding construction industry, the growing need for electrical and electronic items, and the rising demand for e-buses are key contributors to the region's plastic additives market growth. The region is also witnessing a surge in the packaging sector, driven by the rapid rise of e-commerce. Increased disposable incomes are leading consumers to spend more on home décor, ornamental products, and furniture, boosting the furniture sector in China and India. Governmental initiatives, such as India's 'Housing for All' initiative, aim to build over 20 million affordable homes for the urban poor by 2022, further propelling the market.
North America’s Substantial Market Share
North America holds a substantial part of the global market due to the growing use of plastics and polymers in various industries, including packaging, construction, aerospace and defence, food and beverage, general manufacturing, and automotive. The US, in particular, continues to dominate the market due to significant demand from the automotive and packaging industries. Increased urbanisation and rising consumer spending power are primary drivers of market growth. In February 2021, Lanxess boosted its growth trajectory by acquiring 100% of Emerald Kalama Chemical, a US-based firm and global leader in specialty chemicals. This acquisition underscores the strategic importance of specialty chemicals in the market.
Competitive Landscape
In March 2021, SABO signed a distribution agreement with the RNM Group, a leading chemical company in Portugal. RNM Group will distribute SABO Polymer Additives products under the brand names SABOSTAB, SABOSTAT, and SABOFOG throughout Portugal. Additionally, in January 2021, Songwon Industrial Co. Ltd and Mumbai-based Makwell Plastisizers Pvt. Ltd signed an exclusive distribution agreement for PVC additives in India.
Key Players in the Market
Key players in the plastic additives market include BASF SE (Germany), Clariant AG (Switzerland), LANXESS AG (Germany), Evonik Industries AG (Germany), Kaneka Corporation (Japan), Albemarle Corporation (U.S.), Songwon Industrial Co., Ltd. (South Korea), Nouryon (Netherlands), and The Dow Chemical Company (U.S.). These companies continue to drive innovation and expansion, maintaining their competitive edge in the global market.
