The plastics industry had many ups and downs in 2020. COVID-19 affected the global economy on every level, creating challenges and opportunities. This year, all signs point towards the plastics industry experiencing a year of growth. The following will discuss the forecast for growth in the plastics industry in 2021.
The pandemic has had an undesirable impact on the plastics industry because it disrupted the import of raw materials, made it harder to transport products, and affected the predictability of supply and demand. In addition, the pandemic created fluctuations in oil prices, which led to instability in prices for petroleum-based plastics. Yet, even as supply chains were challenged, the demand for plastics has continued to grow.
Anticipated Growth in Plastics Market
Back in 2019, the global plastics market had a value of 621.9 billion USD. Between now and 2028, the market has a compound annual growth rate of 3.4%. With this growth rate in mind, the market share of the plastics industry is expected to reach anywhere from 750.1 billion USD to 758.6 billion USD by 2028. The main factor contributing to the growth of the plastics industry is that the number of uses for plastics is steadily growing each year. Additionally, awareness about bioplastics has increased demand within the market.
Areas Fueling Growth
One area fueling growth right now is bioplastics. To combat pollution many governments around the world have instituted policies discouraging the use of traditional plastics. This has led to more significant investment in research and development into bioplastics and recycled plastic. In addition, some governments are actively encouraging manufacturers to use bioplastics through laws and governmental policies. All of this has raised awareness for the industry and helped spur growth in manufacturing. Other areas helping to increase global demand for plastics include the construction industry, the automobile industry, and the medical end-use industry, especially in Asia-Pacific areas. Many materials used in these industries traditionally made with metal are now being made with plastic because plastic is less expensive yet highly durable.
Another important sector is packaging manufacturing. The most significant share of the growing demand for plastics belongs to packaging. Plastic is used for packaging in several areas, including the food industry, pharmaceuticals, and personal and homecare goods. Flexible plastic has become a prevalent packaging solution because the ability to change shapes allows for diverse applications. In 2020, the global market share of flexible plastic packaging peaked at 95,410 million USD and was expected to reach 115,250 million USD by 2027.
Applications for plastics continue to increase each year. The durability, flexibility, and cost-effectiveness of plastic as a material has made it invaluable in many different areas, including the food industry, healthcare, construction, and transportation. Meanwhile, bioplastics have become increasingly important as governments and businesses worldwide look to find environmentally friendly packaging solutions. Together, this is expected to fuel growth in the plastics industry between now and 2028.
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