European polymer demand | markets feature
AMI’s new European Plastics Industry Report fi nds that polymer demand is slowly returning to growth, but supply issues may threaten the recovery. Carole Kluth reports
Europe’s plastics industry turns the corner
The European plastics industry in 2015 fi nds itself in another period of upheaval and change as it struggles to pull out of the stagnation caused fi rst by the Great Recession in 2008-2009 and the subsequent eurozone crisis in 2012-2013. In the two years since AMI last published its
European Plastics Industry Report, demand has barely shifted from just over 36 million tonnes and the volume of polymers consumed in 2014 was still some 10% below that used in 2007 before the Great Recession hit. For 2015, there are signs that polymer demand is
slowly returning to growth, after nearly three years of fairly fl at market conditions, but markets are potentially being harmed by shortages of raw material. AMI is forecasting that European polymer markets will grow by 1.3% this year, building on a recovery of less than 1% for 2014. However, even this modest gain is under risk from the region’s tight supply for many materials and rapidly rising prices. The cyclical nature of the chemical industry means that in many regards the industry has been in similar circumstances before. The fi rst edition of AMI’s Euro- pean Plastics Industry Report was published 21 years ago in 1994 when the key issues facing the industry were identifi ed as being overcapacity, globalization, environ-
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mental issues, weak economic growth, and erratic and volatile pricing. All of these issues still resonate today and continue to challenge the global competitiveness of the plastics processing industry in Europe. Post-1994, the continent went on to enjoy a period of
strong economic growth of between 2 and 4% per annum for the next 13 years, driven by the expansion of the EU, the creation of the eurozone and the global growth driven by China. However, in the current environment of slower long-term global growth, rising energy and material costs and declining populations within Europe, future European polymer demand growth is unlikely to be substantially beyond current modest GDP targets of around 1-2% per annum.
It’s not all bad news Whilst at a top line level the trend in the market looks pretty static, patterns of demand have been variable by polymer, by application and by country. AMI’s report shows who have been the winners and losers over the past fi ve years. While demand for LDPE/LLDPE has shown no overall
growth through a combination of material shortages, reformulations and packaging downgauging, HDPE saw more solid growth in 2014 of nearly 2%. This was driven
August 2015 | COMPOUNDING WORLD 15
Europe’s plastics
markets come under close scrutiny in AMI’s new report
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