Montréal — What is the word of the year in 2014 for the plastics industry? 'Progression,' according to Guillaume Cariou, director of studies and international strategies for Mercadex International, a market consulting firm.
Cariou gave an overview of global market trends during the Society of Plastics Engineers' workshop at the Expoplast event in Montréal. Citing stats from market research firm The Freedonia Group, the global plastic processing machinery demand is expected to advance to 7% through 2017 to $37.6 billion.
Globally, the Asia-Pacific region will record the strongest plastic processing machinery shipment gains through 2017, led by China, which will account for 59% of total regional output.
Cariou said that an important and growing trend is for companies to locate the production of equipment that is close to the market it serves.
"This way the machines are not being sent far away. Being close to the customer base is a trend that we are seeing," he commented.
In addition, he said while much focus is placed on China and India; don't overlook the growing markets of Indonesia, Thailand and Vietnam. Those are countries looking to produce locally for the local customer base.
Central and South America sales will climb the most rapidly, led by the Brazilian market. An interesting point that Cariou brought up: he said the main challenge for Latin America is to find and retain people to conduct sales locally.
The African demand for equipment is fast growing. The challenge there is for companies to know where to prioritize business and focus on which region to do so.
Cariou briefly highlighted Europe and said it is facing very complex market challenges, something PlasticsToday has reported on throughout the year.
And then the talk ended on a very hot topic in the states - reshoring. He gave examples of three companies that have reshored its manufacturing, which include: Wright Engineered Plastics (Santa Rosa, CA), Precision Extrusion (Glens Falls, NY) and Intertech Plastics (Denver, CO).
Sébastien Lavoie, assistant chief economist, head of economic research at Laurentian Bank Securities, gave a general economic outlook, citing that things are looking quite positive for the U.S.
"Salaries are increasing, the U.S. consumer confidence is back and Americans are spending - these are all items that impact the plastics industry," he said.
He said packaging continues to be a growth area and then turned his attention to automotive.
While Canada current ranks as the no. 1 auto exporter to the U.S., there are estimates that Mexico could take that top spot.
"Canada is competing with Mexico on automotive," he said. "The American automobile industry is doing well, however, Canada is still expensive in aspects such as labor compared to Mexico. That needs to be corrected."