Coatings World - August 2016

According to the latest research from AMI Consulting, the NAFTA market for thermoplastic concentrates continues to have strong prospects for growth and market penetration. At the same time there are new opportunities to profit from increased customer service needs among major brands. In recent years the market has seen a period of sustained growth not experienced since the 1990s with North America increasingly a key center for innovation and global brand developments, making it an ideal place to develop new colors and property enhancing products.

For many years the concentrate industry in NAFTA tended to outperform the overall polymer industry as plastics processors recognized the technical and business advantages of using concentrate over compound and other systems. Although in the future the delta between polymer growth and concentrate market advance will narrow the prospects are still very good in value added areas such as custom color and additive materials.

The opportunities in the marketplace will have a major impact on company strategy. The NAFTA market is seeing a considerable volume of new investment both from the traditional major players but also new market entrants. This will only emphasize the competitive nature of the market where there have been clear winners and losers in recent years with some players cutting back their activities and closing plants while others have sought wider or new markets to sustain their business. What the research from AMI highlights is the way in which a number of new names in the industry are coming to the fore in the color segment.

The largest market for concentrate in NAFTA is still for additive types ( especially mineral based products) which accounts for 47 percent of demand. The color segment is however the most important in value terms in a market which now exceeds $3 billion in sales.

NAFTA continues to have a strong export surplus in concentrate of well over 50 million lbs. This is further testament to the strength and size of the concentrate industry in NAFTA. The surplus is most significant in additive and color varieties, but all product types show net levels of exports.

AMI concludes that the market in NAFTA will continue to grow albeit at levels much lower than has historically been the case because of much slower growth in the traditional volume markets for concentrate in polyethylene film and blow moulding. Opportunities will arise in more specialty sectors such as grass yarn and high performance packaging and in the growing use of recycled materials that will require additive packages to modify performance.

U.S. Demand for Natural
Polymers to Exceed $5
Billion

U.S. demand for natural polymers is fore-
cast to expand at a 4. 3 percent annual
pace to $5.1 billion in 2020, reaching 1.9
billion pounds. Growth will be driven
by demand for natural ingredients in the
large food and beverage industry, which
will bolster use of cellulose ethers and
starch and fermentation polymers. Most
product types will benefit from strong
demand from the medical market, as
natural polymers are used extensively in
pharmaceuticals, wound care, and ortho-
pedic injections. These and other trends
are presented in Natural Polymers, a new
study from The Freedonia Group.

Cellulose ethers are the largest product type of natural polymer, representing a third of the market. Methyl cellulose will retain its market-leading spot through the forecast period, but demand for hydroxyethyl cellulose (HEC), microcrystalline cellulose (MCC), and car-boxymethyl cellulose (CMC) will also be significant. Methyl cellulose’s largest application is construction, where it used in a variety of capacities, including plastering, flooring, grouting, mortaring, tile adhesion, and stucco.