Sponsored By

Global annual average demand-growth for bi-oriented polypropylene film is set to drop by about 2% in the next few years. Capacity, however, is set to expand by 33%, which could make for an interesting fight for market share.

PlasticsToday Staff

September 29, 2009

3 Min Read
After rapid years of growth, a trough for BOPP film demand

Global annual average demand-growth for bi-oriented polypropylene film is set to drop by about 2% in the next few years. Capacity, however, is set to expand by 33%, which could make for an interesting fight for market share.

The numbers come from a new study, World BOPP Film Market Trends 2008, by PCI Films Consulting (Guilsborough, England). The study examines the BOPP film market from 2003-2008 and predicts where it is headed for the period 2008-2013. The chart shows demand-growth for that first period, and also PCI’s prediction that demand will fall in every region, though that fall will be most pronounced as a percent of total demand in Western Europe, the only region where demand fell in 2008.
 

NF_0930_BOPP_web2.jpg

Elsewhere, the $15 billion BOPP film industry experienced more positive buyer behavior. Growth in demand was seen in Eastern Europe, thanks to investment in retailing, food processing, and new converting equipment. In South East Asia, especially India, growth was stimulated by increased availability of film, according to PCI. North America experienced a 3% growth in demand in 2008, whereas demand in Central and South America remained relatively stable.

During the year, supply and demand in China’s 1.8-million-tonne market became more balanced, which made for some capital investment recently. Film orientation-equipment designer Brückner (Siegsdorf, Germany) still sees continued high demand for its equipment in China, according to Uwe Thönniss, managing director of the company’s Servtec division, who spoke with MPW last week during the course of a technical forum at optical-quality-control equipment supplier OCS (Witten, also Germany).

Thönniss said that since 2001, 50% of all of Brückner’s sales have been to processors in China. Brückner controls about 55% of the market for bi-orientation film equipment, with the rest mostly split between three other companies (DMT-16%; Dornier-14%; JSW-MHI – 4%). Of all bi-orientation equipment, about 66% is used for processing of PP, he said, followed by 25% for PET, 5% for polyamide, and the remainder for an assortment of niche products.  
 
For buyers of BOPP film, PCI’s report also confirms that the Middle Eastern BOPP film industry is expected to emerge as a significant regional production center in the future, doubling its size in the next three years. One of the major factors driving this growth is the support given by regional governments to downstream industries, which are capable of adding value to oil assets. PP resin production, film extrusion, flexible packaging, and food processing are all industries targeted for expansion in the region. Limited regional demand, however, means processors there will be pressed to find customers in export markets.

In the next five years, according to PCI, an additional 2.3 million tonnes of new BOPP film capacity is expected to be commissioned, expanding the industry by a third, which will likely will cause a shakeup not only in the market’s leadership but also in its pricing structure. —[email protected]

Sign up for the PlasticsToday NewsFeed newsletter.

You May Also Like