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The global high-density polyethylene (HDPE) resins market size was USD 52,389 million in 2019 and it is projected to reach USD 68,297 million by 2027, exhibiting a CAGR of 4.96% during the forecast period.
The HDPE resin industry is getting affected by the frequent fluctuations in crude oil prices. This price collapse ultimately reduces the plastic prices. Moreover, the rising tension between the trade war with China had a significant impact on the prices and thus has also lowered the demand for recycled high-density polyethylene resins. According to KW Plastics, slump in the automotive industry had a huge impact on the market and has further led to the overproduction of the material.
Manufacturers are Facing Supply Chain Challenges amid COVID-19 Pandemic
The outbreak of the COVID-19 pandemic has disrupted the entire supply chain of the majority of the industries in the world. High-density polyethylene resin industry is no exception. There is a huge shortage of manpower. Also, the dipped oil prices are leading to the flight of the industries. The governments around the world are trying hard to curtail the harsh impact of the COVID-19 outbreak and stop the collapse of the national economy, as well as the health care system around the globe.
The governments are implementing emergency norms so as to smoothen the logistics supply and minimize the disruptions in the supply chain. This pandemic is being regarded as one of the worst humanitarian and financial crises till date since World War 2. The imposition of lockdown has resulted in the closure of thousands of manufacturing facilities and many are fearing about the permanent closure of some of these facilities. But the governments are playing their role in the best possible way by providing stimulus packages and other measures to support the affected industries.
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Strong Construction Industry Especially in China and the U.S. to Boost Demand for HDPE Pipes
HDPE is significantly being used in films to secure the goods in the warehouse and logistics. The thin-film applications of HDPE resin are expected to proliferate in the upcoming years considering the increasing usage of packaging films by the ever-rising population. Food packaging will be having a higher demand due to the good quality and multilayer barrier needed to extend the shelf life of the product, along with the reduction of food waste. The flourishing construction industry, especially in China and the U.S. is expected to boost the demand for high-density polyethylene pipes. Concrete, copper, and steel pipes are deliberately getting replaced by plastic pipes due to their performance, cost, and installation advantages. As per Global Construction Perspectives and Oxford Economics, the global construction volume is estimated to increase by 85% by 2030 of which China, the US, and India are estimated to contribute around 57% of the overall growth. Moreover, the US construction industry is expected to grow at a faster pace as compared to China.
Soaring Demand for PE Resins for Packaging Purposes to Drive Growth
High-density polyethylene resins have been extensively used in rigid, as well as flexible packaging. The probable ban on single-use plastics is likely to benefit the manufacturers as the ecosystem for HDPE recycling was being constantly built up. This is further expected to ramp up as restrictions take over.
High-density polyethylene sheets & films are particularly used in carrier bags, wrappings, refuse sacks, and industrial liners. Besides, a substantial amount of rigid packaging solutions manufactured by using HDPE resin which includes, crates, packaging containers, tanks, and others. The rising penetration of online shopping, internet, and food delivery services especially in the emerging nations has resulted in an exponential rise in the demand for packaging raw materials, high-density polyethylene being one of the prominent.
Strong Presence of Substitutes such as PET to Restrain Growth
Polyethylene terephthalate (PET) is one of the strongest substitutes to high-density polyethylene resin. PET is primarily used for water bottles, soda bottles, food containers, and others. Recycled PET bottles are considered to possess a very well established market. They are also one of the most used recycled plastic. One of the main factors that would lead to the growth of bottle recycling is the development of technologies that would further increase product purities and reduce operational costs.
Film & Sheet Segment to Generate Highest Revenue Owing to Usage in Packaging Applications
Film & sheets are often used for various packaging applications. HDPE resins possess excellent thermal stability, superior energy resistance to cracking tension, durability, and thickness. These are also well-equipped for a variety of extrusion film applications such as food, deep-freeze bags, grocery, and garbage bags.
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Packaging Segment Holds Significant Share Backed by Rising Production of Lumber & Bottles
The packaging segment holds the highest high-density polyethylene resins market share as these resins have low temperature, compressive strength, and outstanding chemical resistance with a high strength-to-density ratio. In the packaging industry, it is majorly used in the manufacturing of plastic bottles, plastic lumber, and corrosion-resistant tubing. High-density polyethylene packaging is widely used in many ways, including sacks, containers, and bottles.
North America HDPE Resins Market Size, 2019 (USD Million)
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Asia Pacific is the fastest growing region in the market in terms of consumption, as well as production due to the high population and the developing building & construction, packaging, and other industries in this region. Majority of the HDPE resin producers and capacities are concentrated in the Asia Pacific region.
In terms of revenue, North America holds the share of 16.90% in the global market. The sales and supply of high-density polyethylene resins depend on the key consumer industries present in the region, as well as those located all over the world. Moreover, packaging is the largest market in the region due to an increasing demand from sectors such as healthcare, food and beverages, and chemicals.
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The HDPE resins market in Europe is stable and saturated from years and thus the manufacturers and the plastic converters show the slowest growth of 1% - 2% annually in this region. Europe is a small exporter of high-density polyethylene resins because of the growing competition and shifting of the market to Asia Pacific especially to China, Japan, Thailand, and India.
Market Players are Expected to Strengthen their Position by Offering Various HDPE Resins Solutions
The major producers of high-density polyethylene resins are located in Europe. But, the demand is high from Asia Pacific leading to a fragmented market. The producers in North America and Europe are continuously engaging in mergers & acquisitions in order to strengthen their market positions and to drive the business growth. As a result, key players in the market have developed strong regional presence, distribution channels, and product offerings.
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The report covers an elaborative analysis of the high-density polyethylene resins market dynamics and competitive landscape. Various key insights presented in the research report include price trend analysis, recent industry developments in this market, the regulatory scenario in crucial countries, macro, and microeconomic factors, SWOT analysis, key industry future trends, competitive landscape, and company profiles.
A growing trend is observed in the penetration of the global high-density polyethylene resins market across the industries. The report provides qualitative and quantitative insights into the market and a detailed analysis of the market size & growth rate for all possible market segments that exist in the market. The market report is segmented by application, end-use industry and geography. Based on application, it is classified into film & sheet, injection molding, blow molding, pipe & profile, wire & cables and others. By the end-use industry, it is divided into packaging, agriculture, building & construction, automotive, and others. Geographically, the market has been analyzed across five major regions, namely, North America, Europe, Asia Pacific, Latin America, and Middle East & Africa. These regions are further categorized into countries.
Value (USD Million) and Volume (Kilotons)
Application, End-use and Geography
By End-use Industry
Fortune Business Insights says that the global HDPE resins market stood at USD 52,389 million in 2019 and is projected to reach USD 68,297 million by 2027.
The market will exhibit steady growth at a CAGR of 4.96% in the forecast period (2020-2027).
The packaging segment is expected to be the leading segment in the market.
Increasing demand from the food packaging industry is driving market growth.
Asia Pacific is expected to hold the highest share in the market.
The rising demand for hygienic packaging is the key market trend.
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