Compounding Need for capacity expansion to meet the growing demand Plastics are dominating virtually every industry vertical and constantly finding their way into new applications as they evolve. In order to keep up with the demand for highperformance materials across different industries, plastic manufacturers worldwide are looking to ramp up the production of compounded plastics. In February 2019, for instance, Aurora Plastics had finished the upgrading and expansion of its Texas-based plastic production and compounding facility. The new 60,000 sq ft facility includes upgrades in automation and control systems, compound blending, and a new research centre with improved product testing capabilities. Last year in June, Mitsui Chemicals Inc. along with its subsidiary Prime Polymers began operations at the Mitsui Prime Advanced Composites Europe B.V. (ACE) located within Netherland’s Chemelot Industrial Park. Mitsui’s first PP compounding facility in the European region, the new plant has a capacity of nearly 30,000 tonnes/year.
business. Another major company based in Houston, Texas, Ascent Performance Materials has been picking up compounding companies based in the European region. In January, the company acquired France-based compounder Eurostar Engineering Plastics, followed by the acquisition of Italian compounding and masterbatch firms Poliblend and Esseti Plast GD from the D’Ottavio Group in February. Meanwhile, many companies are collaborating with other manufacturers to develop high-performance materials for various applications. In May last year, German materials firm Covestro had announced that it is collaborating with plastics compounder Teknor Apex for developing compounded thermoplastic polyurethane, a highly versatile plastic material that finds application in a wide range of industries. Plastic Compounding Market, by Product 2019 & 2026 (USD Milion)
Others Thermoplastic elastomers Thermosetting polymers Thermoplastic polymers
2016
2019 Source: www.gminsights.com
Thermoplastic polymers will dominate the overall industry size Mitsui and its subsidiary Prime Polymer set up a new PP compounding plant in the Netherlands
Over the years, the Mitsui Chemicals Group has managed to boost its global PP compounding capacity to more than 1.12 million tonnes/year. Currently, the company operates production units in eight key markets around the world including the US, Europe, Brazil, Mexico, India, China, Japan, and Thailand. Emerging markets in the Asia Pacific region with rapid population and economic growth are constantly attracting the attention of major automotive and electronics manufacturers in America and Europe. These factors are likely to stimulate the regional demand for high-quality polymers and advanced materials, encouraging local players to boost their production capacity. In February 2018, Japan’s Teijin had invested over US$13 million to set up a new polymer compounding facility in Thailand with a capacity of approximately 10,000 tonnes/year. Recent notable acquisitions and collaborations The plastics compounding market has witnessed several major acquisitions and collaborations over the past few years as manufacturers look to expand their market position. Back in August 2018, LyondellBasell had acquired A. Schulman for US$2.25 billion, allowing the company to nearly double the size of its Houston-based compounding
Citing another instance, in November, US-based Eastman Chemical Company had collaborated with Italy’s Gruppo Maip to develop new sustainable polymer solutions for automotive interior applications. The companies aim to use Eastman’s Advanced Circular Recycling technology to formulate a range of molecular recycled and biobased solutions. Impacts and challenges caused by the pandemic throughout 2020 The outbreak and rapid spread of the novel coronavirus has caused significant disruptions in the entire plastics compounding industry value chain. Small and mediumsize players were among the most adversely affected during 2020. According to a Harbour Results Inc. survey, nearly two-thirds of small and medium-size businesses had been forced to operate at a reduced capacity. Automotive and electronics companies experienced the largest impact among all businesses with lowest operating levels of just 28% and 67% respectively, undoubtedly leading to a weakened demand for plastics. In addition to supply chain disruptions and production concerns, increased use of single-use plastics and the subsequent rise in plastic waste generation has also emerged as a major challenge for the industry. MARCH 2021
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