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Eight functional classes of specialty plastics additives are described in
this report (commodities such as plasticizers and fillers are excluded, as
are polymerization catalysts and colorants).
Each functional class in turn includes several product types. These products
are produced by a wide spectrum of chemical companies, only a few of which
produce more than two functional classes. Although there are many participants,
two to four companies tend to dominate each functional type within each major
world region. Additive customers include resin manufacturers, specialty compounders
and plastics fabricators. The volumes of individual additive products are often
quite small, and significant volumes of some of these additives are exported
to customers throughout the world. Indeed, there is a growing recognition of
plastics additives as a worldwide business, especially as companies broaden
their participation by adding more functional types to their product lines.
Another reason for a worldwide perspective is that many of the customers (i.e.,
the large resin producers) also operate worldwide.
Global consumption of plastics additives was valued at $12.6 billion in 2005.
Growth in plastics additives on a volume basis was moderate in the United States
and Canada, averaging 2.6% per year over the 2002–2005 period, reflecting
the weak performance of the U.S. economy and of the plastics industry during
this period. Similarly, growth in plastics additives in Western Europe and
Japan was slow during 2002–2005, averaging only 3.7% and 1.1% per year,
respectively. Indeed, Japan’s market for plastics additives has shown
very little growth in the last two years because the Japanese market for plastics
is generally mature. New economies like China, India, Brazil and Russia achieved
high growth rates in 2002–2005. China was in the lead with annual growth
rates over 10%. It is expected that the momentum for further growth will come
from this group as well for the 2005–2010 period.
The following pie chart shows world consumption of plastics additives by type:
The future growth of plastics additives as a class is tied largely to the
growth of the resin industry and the end-use consumer segments it serves (e.g.,
packaging, automotive and construction). In turn, the growth of these consumer
segments is tied strongly to overall economic growth, which is expected to
resume at a modest pace following the downturn that characterized the early
years of the new century. Overall growth for plastics additives in the three
major consuming areas is expected to average about 4% per year over 2005–2010,
but will be fastest (10–12%) in China and slightly negative in Japan.
The negative growth forecast for Japan and small growth rates forecast for
the Republic of Korea and Taiwan will result from a continuing shift of the
production of plastics and finished goods from these countries to China, where
labor and some raw material costs are much lower. Japanese additive producers
hope they can continue to supply some of these customers via exports, but will
face much stronger competition from highly cost-competitive producers in nearby
Asia.
These developments in the East Asian market will continue to create export
opportunities for U.S. and Western European suppliers for specialties. They
will also present opportunities for producers in all three regions to form
joint ventures with companies or government agencies in East Asian countries,
especially China, to produce the required additives in that region. Increasingly,
commodities from China and the Republic of Korea will be exported to all other
regions of the world.
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