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2020 round-up: The year of opportunities and challenges
Source:Adsale Plastics Network     Editor:VC    Date:31.Dec.2020

The COVID-19 pandemic has changed our lives and our way of working. It also changed the developments of the plastics industry in certain ways.

 

Meanwhile, the changing market outlook has been putting forward higher requirements for enterprises’ capabilities in crisis management, business development and independent innovation.

 

2020 has been a challenging year. Looking to 2021, let’s embrace the opportunities and challenges, and shape a better future together.

 

Opportunities

 

Growing demand for medical equipment and materials

 

The COVID-19 pandemic has boosted the demands for protective gears, medical equipment, and testing and vaccination devices, such as face masks and gloves, protective clothing, infusion devices, syringes, etc.

 

According to the New York Times Coronavirus Vaccine Tracker, over 165 vaccines against the COVID-19 are now being developed around the world. Meanwhile, worldwide governments are preparing for the implementation of vaccination programs.

 

The pandemic has also aroused public attention to healthcare issues, stimulating the demand for personal healthcare products and home medical equipment.


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The COVID-19 pandemic has stimulated the demand for personal protective equipment (PPE).


 

New potential for packaging sector

 

As public health care concerns gain wider attention, the demand for fast-moving consumer goods, such as cleaning and disinfection products, would also further increase. The demand for packaging would also be increased due to the increased sales of these goods.

 

Meanwhile, online shopping and food ordering have been growing as consumers eschew physical stores and crowded restaurants, driving e-commerce and non-contact delivery packaging designs and formats.

 

China is already seeing an uptick in demand for these offerings, popular delivery platform Meituan has seen an increase in large orders and surging demand for online grocery.


 

5G technology to develop faster

 

During the COVID-19 pandemic, people working from home drive the demand for PC laplops and tablets. Meanwhile, the growing demand for remote interactions has potentially accelerated the development and adoption of the 5G technology.

 

The global market for video conferencing is expected to be further boosted, according to latest reports of market research institutes. In addition, there are many benefits to remote diagnose by leveraging 5G technology, it keeps people who might be infected out of waiting rooms, and lets experts see patients in a wider geographic area.


 

Recycling industry to grow solidly

 

Like other industries, the plastics recycling industry has been facing problems tied to the COVID-19 pandemic. Nevertheless, according to several market reports, the global recycled plastics market is expected to grow, with packaging as the key driver due to growing demand for rPET.

 

With most of the polyethylene terephthalate (PET) moving across the industrial supply chain, the consumer brands with polypropylene (PP) bottles have also been opening up towards packaged bottles with recycled content, enabling a higher contribution from bottles.


Continuous technological developments will improve recycling quality and increase cost effectiveness.


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The recycled plastics market is expected to grow with packaging as the driving force.


 

Challenges

 

Most exhibitions rescheduled

 

In the wake of high degree of uncertainty in COVID-19 pandemic globally and following the preventive suggestions by the State Council of China, many scheduled exhibitions in China and overseas were postponed or cancelled.

 

The iconic 34th CHINAPLAS, the International Exhibition on Plastics and Rubber Industries, has been rescheduled to take place from April 13-16, 2021 in Shenzhen, China. Meanwhile, the 27th Fakuma international trade fair for plastics processing has been postponed to October 12- 16, 2021 and will be held in Friedrichshafen, Germany.

 

Other affected major exhibitions include ArabPlast 2021 and PLASTINDIA 2021. The former has been postponed to November 15-18, 2021, and the latter will be held in February 17-21, 2022.


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CHINAPLAS has been rescheduled to be held from April 13-16, 2021 in Shenzhen, China.

 

Uncertainties plagued the automotive industry

 

As one of the most important application sectors of plastics, the performance of automotive industry directly affects the primary and secondary plastics-related product suppliers in the supply chain, and in turn affects the upstream suppliers of raw materials and production equipment.

 

In January and February, the production and sales of automobiles were decreased remarkably by more than 40% year-on-year in China, the largest automotive manufacturing country and automotive market. Thanks to the effective pandemic prevention and control measures, the Chinese automotive industry and market has been gradually recovering.

 

Nevertheless, in the context of declining consumption growth, some experts expect the Chinese automotive industry to remain uncertain in 2021.



Supply chain crisis

 

In the meantime, the epidemic brought big challenges to the global supply chain of the manufacturing industries. Production halts, logistics disruptions and global travel restrictions were among the challenges confronting the industry.

 

For China, intermediate products and core parts are still highly dependent on import in many manufacturing industries, such as automotive, petrochemicals, E&E, machinery and equipment, etc. In the global fight against the epidemic, China has taken the lead in resuming business and production, injecting momentum into the global supply chain.


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China adopted different measures to resume operation and production during the COVID-19 outbreak.

 

Rising raw material prices

 

Many chemical companies recorded varying degrees of profit decline in 2019. The outbreak of COVID-19 brought more challenges against the chemical industry. In the US, the total chemical production volume excluding pharmaceuticals fell by 3.6% in 2020, according to the latest report of American Chemistry Council (ACC).

 

The COVID-19 epidemic caused some chemical plants to suspend production and adjust inventory plans. With the increasing demands for PPE, PC laptops and tablets, small home appliances, the market supply and demand structure has changed, accelerating the price increase of chemical raw materials.



To help plastics enterprises prepare for 2021 and shed lights on the further developments of the plastics industry in a new normal, Adsale Plastics Network will launch an industry survey in early January, 2021. Stay tuned!  


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