Analysis of the Development Status and Future Prospects of China’s Modified Plastics Industry

Apr 23, 2023

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Development prospects

Modified plastics are a typical industry benefiting from technological progress and consumer upgrading. With the transfer of global production capacity in home appliances, automobiles, electronic appliances, electric tools, toys, and other fields to China, China has become a major manufacturing country in these fields, which has driven the development of the domestic modified plastic industry.

The upgrading of consumption has continuously raised people’s requirements for material performance. These two factors have made China the main demand growth engine for global modified plastics, and the modified plastics industry in China has broad development prospects in the future. The specific analysis is as follows:

1. Improvement of plastic steel ratio

Compared with other materials, plastics benefit from advantages such as high production efficiency and low density, with lower costs and lighter weight. Therefore, an important direction for the use of modified plastics is to replace metal materials, and the plastic steel ratio is an important indicator to measure the development level of a country’s plastic industry.

According to the report in the “China Plastics Industry Yearbook (2019)”, the proportion of plastic and steel applications in China is about 30:70, while the proportion of plastic to steel in the United States and Germany reaches 70:30 and 63:37 respectively, with a world average of 50:50. As a major manufacturing country for automobiles, electromechanical products, home appliances, and other products, China’s plastic steel ratio is significantly lower, and there is great room for improvement in the future.

2. Downstream application fields continue to expand

With the continuous improvement of modification technology, the flame retardancy, weather resistance, and alloying level of modified plastics are constantly improving, and the application range is constantly expanding. Hard PVC as a substitute for wood materials can be widely used in fields such as construction, packaging, furniture, etc. New high hardness composite materials developed abroad can be recycled and can replace aluminum alloys. The application of some engineering plastics is no longer limited to aerospace and military applications, but has been popularized in civilian fields, such as electronic products, packaging materials, automobiles, and other fields.

Artificial organ and artificial bones and joints made of modified engineering plastics have also appeared in medical and health scenes. The increasingly strict requirements for energy conservation and environmental protection have stimulated the widespread use of modified plastics in the automotive and transportation industries. With the growth of the application scope and volume of modified plastics, the market demand and market space for modified plastics will continue to grow.

3. High demand for import substitution

The modified plastic industry has a long history of development in many developed countries. Large international chemical enterprises such as BASF, Dow, DuPont, SABIC, etc. have obvious advantages in raw material supply, business scale, and technology accumulation. They are in a leading position in the formulation research and development, processing and manufacturing, brand quality, and other aspects of high-performance specialized modified plastics, and their products are widely used in high-end fields. In contrast, most domestic modified plastic enterprises began to rise after the development of the domestic home appliance and automotive industries.

Although the development speed has been relatively fast in recent years, there is still a certain gap in comprehensive competitiveness compared to international large chemical enterprises. At present, the domestic high-end modified plastic market is still dominated by imports, with a high demand for import substitution.

In recent years, as large-scale domestic enterprises in the industry continue to increase R&D investment, the technology gap with large international enterprises gradually narrows. Some enterprises focus on the research and development of functional and high-performance products, gradually penetrate into the high-end market penetration, and have a large market space to replace expensive foreign products.