Analysis on the current situation and development trend of modified plastics industry, high-end demand will increase

May 07, 2022

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Modified plastics refer to plastic products that are processed and modified by filling, blending and strengthening methods on the basis of general plastics and engineering plastics, and improve the properties of flame retardancy, strength, impact resistance and toughness. At present, modified plastics are widely used in home appliances, automobiles, communications, medical treatment, electronics and electrical, rail transit, precision instruments, home building materials, security, aerospace, military and other fields.

Current situation of modified plastics industry

From 2010 to 2021, China’s modified plastics increased rapidly, from 7.8 million tons in 2010 to 22.5 million tons in 2021, with a compound annual growth rate of 12.5%. With the expansion of the application field of modified plastics, there is still a large development space for modified plastics in China in the future.

At present, the demand market for modified plastics is mainly distributed in the United States, Germany, Japan and South Korea. The United States, Germany, Japan and other developed countries have advanced modified plastics technology and early application of modified plastics. The demand for modified plastics in these areas is far ahead. In recent years, with the progress of modified plastics technology and the promotion of modified plastics application in China, the scale of modified plastics market in China is also increasing.

In 2021, the demand of the global modified plastics industry changed greatly, about 11 million tons. After the end of the COVID-19, with the recovery of production and consumption, the market demand for modified plastics will increase significantly. In the future, the market demand growth of the global modified plastics industry will be about 3%. It is expected that the market demand of the global modified plastics industry will reach 130million tons by 2026.

After China’s reform and opening up, the application of plastic modification technology is also gradually rising. However, due to the late start time, the domestic plastic modification processing industry has the problems of weak technology and small scale, and the varieties of high-end products mainly rely on imports. According to the data, the output of modified plastics of Industrial Enterprises above Designated Size in China reached 19.55 million tons in 2019, and it is expected that the output of modified plastics of Industrial Enterprises above Designated Size in China will reach more than 22.81 million tons in 2022.

Development trend of modified plastics industry

With the development of 3D printing, Internet of things, 5g communication, artificial intelligence and other technologies, the application scenarios in the downstream fields of modified plastics are constantly enriched and the scope of application is expanding, which brings development opportunities to modified plastics and puts forward higher requirements for modified materials.

In the future, the development of China’s modified plastics industry will show the following trends:

(1) The upgrading and progress of downstream areas will promote the upgrading of modified plastics industry

With the rapid development of 5g communication, Internet of things, artificial intelligence, 3D printing and other technologies, the rise of smart home and new energy vehicles, the market’s requirements for material properties are constantly improving, and the innovation and development of modified plastics industry will continue to increase. At present, the external dependence of China’s high-end modified plastics is still relatively high, and the localization of high-end modified plastics is imperative. Plastic products with low density, high rigidity, high toughness, high temperature resistance and low volatile organic compounds will be more and more widely used.

With the new market demand of new energy vehicles and smart homes, more high-quality modified plastics will be required, and differentiated high-end modified plastics will usher in the spring of development.

(2) The progress of modification technology promotes the upgrading of modified plastic materials

With the promotion of application demand, the modified plastics industry is also actively developing new modified technologies and material formulas, which has promoted the rapid development of modified technologies. In addition to the continuous development of traditional reinforcement, flame retardant and other technologies, composite modified technologies, special functionalization and alloy collaborative application technologies will also increase. The modified plastics industry shows the trend of diversification of modified technologies, engineering of general plastics and high performance of engineering plastics.

Engineering of general-purpose plastics means that general-purpose plastics gradually have the characteristics of some engineering plastics through modification, so that they can replace some engineering plastics, which will gradually seize the application market of some traditional engineering plastics. High performance engineering plastics can reach or even exceed some properties of metals through the improvement of modification technology. In recent years, with the vigorous development of China’s information communication and new energy vehicle industry, the demand for high-performance modified engineering plastics has increased significantly. High performance modified engineering plastics with ultra-high strength and ultra-high heat resistance that can adapt to harsh working environment will be well applied.

In addition, under the guidance of social environmental protection awareness and national policies, the market demand for environment-friendly, low-carbon, energy-saving, recyclable and degradable modified plastics is also increasing, and the market demand for high-performance environmental modified plastics is increasing, especially the technical requirements such as low odor, low VOC and spray free may cover the upstream and downstream of the whole industrial chain.

(3) The market competition intensifies and the industry concentration will be further improved

At present, China has a large number of modified plastics production enterprises and fierce industrial competition. Compared with large international enterprises, there is still a certain gap in the overall technical capacity of China’s modified plastics industry. Influenced by many factors, such as the Sino US trade war and the COVID-19, China’s manufacturing industry has paid more attention to the construction of supply chain, requiring that the supply chain be stable, reliable and self controllable, which has also created new opportunities for China’s modified plastics industry. With the market opportunities and the support of national industries, China’s modified plastics industry will go to a new level, and there will be a number of excellent enterprises that can compete with large international enterprises.

At the same time, enterprises with homogeneous technology, lack of independent R & D capability and poor product quality will also face the situation of being phased out by the market, and the further improvement of industrial concentration will become the overall development trend.