Lb with Esther D’Amico

The global plastics additives market is expected to grow 4.5%/year through 2010, driven by strong growth in emerging regions, especially China, according to a report from Townsend Polymer Services & Information (Houston). These drivers as well as globalization and regulatory pressure are reshaping the $32-billion market, Townsend says.

Asia remains the fastest-growing plastics additives market. However, China now surpasses all other reporting regions, accounting for 28% of worldwide additives volume, Townsend says. Major players in the plastics additives industry include BASF and ExxonMobil. Excluding plasticizers, Chemtura, Albemarle, Rohm and Haas, and Baerlocher remain the top producers.

Flame retardants are one of the fastest-growing plastics additives worldwide, accounting for 14% of volume. Plasticizers remain the largest category of plastics additives, accounting for 54% of total volume, Townsend says. The global plasticizer market is an $11 billion industry, with 90% of production consumed in vinyl-based formulations (CW, Sept. 29, p. 36). The market also includes masterbatches, lubricants, and mold-release agents.

However, the market faces several challenges including a recent drop in production of polyolefins, the main resins for plastics additives, Townsend says.

Other concerns include regulatory issues such as the recent U.S. ban on six phthalates used in plasticizers for products intended for children under the ages of 12 (CW, Sept. 22, p. 37). The ban, which stems from phthalates being linked to health conditions including birth defects, reproductive problems, and certain cancers, starts next year and is part of a recent law overhauling the federal Consumer Products Safety Commission (Washington).

The impending U.S. phthalate ban is also affecting the plastics additives industry. "Phthalates comprise 87% of all plasticizers, so they are under attack," Townsend says. "Companies are finding replacements for these and finding chemicals that can do the job but that do not have phthalates in them," Townsend says.

The European Union’s Registration, Evaluation, and Authorisation of Chemicals (Reach) law is another concern. "When Reach extends itself through Europe, what will North American and the U.S. do? This initiative is having the largest single impact on the industry,"

Townsend says.

Meanwhile, production is on the rise for bio-based plasticizers used in polymer formulations. Archer Daniels Midland and PolyOne have announced plans to collaborate on developing polymers made from corn and oilseeds.

The bio-based plasticizers will be alternatives to materials traditionally derived from petroleum-based feedstock.

Overall, the plastics additives industry has been consolidating. There were 21 individual transactions in plasticizers and 17 in flame retardants in the last four years, Townsend says. These include Israel Chemicals’ (ICL; Tel Aviv) purchase of flame retardant producer Supresta (Ardsley, NY) for $352 million last year. The deal expands ICL’s geographic reach and its customer base into the polyurethane foam and engineering plastics markets, ICL says. Albemarle says it plans to make acquisitions across all of its business units. Ciba Specialty Chemicals recently agreed to form a joint venture with masterbatch producer Astra Polymers (Al-Khobar, Saudi Arabia) to sell customer-specific antioxidant blends to resin makers in the Mideast. Ciba-Astra Additives Co., the jv, is set to begin to deliver products by the end of 2009.

Major investments in the sector include Albemarle’s plans to double polymer antioxidant capacity at Shanghai Jinhai Albemarle Fine Chemicals (Shanghai), a jv in which Albemarle holds a 75% stake. Albemarle also boosted its stake in another Chinese jv, Ningbo Jinhai Albemarle Chemical & Industry (Ningbo), a producer of specialty polymer stabilizers, and it has a new bisphenol A diphosphate flame retardant plant at Nanjing, China (CW, Dec. 19/26, 2007, p. 24).

NOTICE: In accordance with Title 17 U.S.C. Section 107, this
material is distributed without profit to those who have expressed a
prior interest in receiving this information for research and
educational purposes.