AMI Consulting
The impact of the move towards a circular economy is presenting a new era for the polymer supply industry, finds a new report.
According to the latest findings from AMI Consulting’s review of the polyethylene markets in Europe, the change to a more sustainable and circular economy is reshaping the polymer supply industry, with resin suppliers engaging in downstream integration with recycling technologies.
Where EU policy has recently promoted the use of increased volumes of recycled material in products where possible and has targeted packaging applications as a focal point for enhanced recyclability, this has driven a rapid rise in consumption of reclaimed/reprocessed polyethylene, innovations in product design and end-of-life treatment options.
In terms of markets, recycled polyethylene is the standout material within blow moulding, with this market expected to champion the uptake of reprocessed polyethylene in the midterm to 2022.
Film extrusion, which has long seen the largest consumption of polyethylene in Europe, accounted for over 50 per cent of demand in 2017. There are big differences, even amongst the LLDPE varieties which, on the whole, have been and will continue to advance rapidly.
AMI says the fortunes of metallocene resins will be “especially bright”, while more well-established varieties such as C8 will experience more limited growth.
Coextrusion technology will continue to drive the use of sophisticated resins while locality and commercial relations are also key in resin selection and can result in processors engineering surprisingly different formulations to meet product specifications.
Further developments in material selection are occurring in blow moulding applications, where bimodal HDPE resins that offer enhanced properties are seeing increased use in containers in the small to mid-size bracket.
Packaging markets are anticipated to become increasingly scrutinised which, combined with ongoing downgauging, is projected to constrain the overall volume growth of polyethylene. The most optimistic segment of the polyethylene industry is that which serves the construction sector.
AMI says pipe, cable and wire extrusion will prosper in the wake of improved construction output (both residential and infrastructure orientated) with HDPE and EVA to enjoy the most notable in these segments thanks to the replacement of PVC, copper and iron pipes and the increasing requirement for fire retardant compounds.
The lack of capacity expansion in Europe is not likely to have an impact on resin availability, due to the tsunami of additional supply on the horizon in North America.
Metallocene resins from Japan and Korea are expanding their share of the market and polyethylene derived from renewable feedstocks are being pioneered from Brazil.