The Changing Plastics Compounding Business

Report Highlights

• In viewing the entire thermoplastic market, the resin producers account for the majority of the compounding activity (producing around 44.585 billion pounds in 2006), followed by plastic processors (12.964 billion pounds) and independent compounders (8.173 billion pounds). Independent compounders, though, will show the highest average annual growth rate (AAGR) at 5.3%.
• When viewing this market by the individual thermoplastics covered in this report, these ratios can be vastly different. For example, the major polyethylene variants, HDPE, LDPE and LLDPE along with polystyrene are compounded mostly by resin producers, while PVC is compounded mostly by processors.
• There are several key trends within the plastic compounding business which will take some time to become significant. They are: forward integration of resin producers into compounding; increased backward integration of large plastic processors into compounding; increased specialization of independent compounders; continued movement of compounding production.

INTRODUCTION

Plastic compounding of raw resins is an essential and critical step in the commercial production and acceptance of plastic products because uncompounded resins are basically useless. Plastic compounding is the process of incorporating a wide array of additives via physical mixing and/or blending, which are processed into forms suitable for finished products. These additives include colorants, stabilizers, flame retardants, impact modifiers, plasticizers, and dozens of others, including fillers/reinforcements. Plastic compounding is accomplished by three groups of companies, namely resin producers, plastic processors (e.g., injection/blow molders and extruders), and independent compounders.

SCOPE OF STUDY

This report contains:

• The major thermoplastic resins and thermoplastic elastomers (TPEs).
• The plastic compounding market that segments the volumes of each resin and elastomer into the three plastic compounding groups for 2005, 2006 and 2011; along with the reasons for these estimates and forecasts.
• The major resin producers, key plastic processors and independent compounders, their activities, product lines and estimated sales.
• Detailed information on activities of major European compounders and Asian activities of North American compounders.
• Other features including a review of key plastic additives used in plastic compounding and important information on major fillers/reinforcements.

METHODOLOGY

Extensive searches were made of the literature, including the leading trade journals, technical papers, company literature, pertinent trade associations, etc.

In addition, interviews were conducted with resin producers and plastics compounders to try and verify consumption, company products, key applications, market trends, etc.

Definitions for many of the key acronyms used in this report can be found in the Appendix.

ABOUT THE AUTHOR

Research analyst Mel Schlechter has over 40 years in the chemical industry, and specializes in plastics market research. He has been with BCC Research for over 10 years and holds a B.S in chemistry, M.S. in organic chemistry and a M.B.A. in marketing