High-Density Polyethylene Market size is forecast to reach $96.10 billion by 2025 after growing at a CAGR of 5% during 2020-2025. High-density polyethylene is a class of polymers produced mainly from petrochemical feedstock. High-density polyethylene possess excellent properties such as tensile strength, moisture resistance, chemical resistance, and low cost which makes them suitable for various end-user industries. The growth of the market of high-density polyethylene is expected to be driven by the high demand from the automotive industry.
High-Density Polyethylene Market Segment Analysis – By Technology
Blow molding held the largest share in the high-density polyethylene market in 2019 in terms of technology. The growing demand for blow molded high-density polyethylene bottles in dairy, water and other beverage packaging is anticipated to further augment the growth of the segment. Blow-molded high-density polyethylene offers excellent properties such as tensile strength and temperature resistance which makes them highly desirable in these applications. The blow molding process begins with melting down the plastic and forming it into a parison or in the case of injection and injection stretch blow molding (ISB) a preform. The parison is a tube-like piece of plastic with a hole in one end through which compressed air can pass. The parison is then clamped into a mold and air is blown into it. The air pressure then pushes the plastic out to match the mold. Once the plastic has cooled and hardened the mold opens up and the part is ejected. The cost of blow molded parts is higher than that of injection – molded parts but lower than rotational molded parts. This factor will drive the growth of market in the forecast period.
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High-Density Polyethylene Market Segment Analysis – By Application
Sheet and films held the largest share in the high-density polyethylene market in 2019 in terms of application. The high-density polyethylene sheets and films exhibits excellent UV and thermal weathering resistance, very low permeability, and chemical resistance among others. These sheets requires few natural resources to produce, generates minimal waste products, and is widely recycled. High-density polyethylene possess good electrical properties, and exhibit extreme resistance and durability in response to chemical solvents and varying temperatures, making them ideal for an abundance of industrial applications. Additionally, it proves environmentally friendly during its production and use by a consumer with no leaking of toxic chemicals. Its thermoplastic characteristic makes high-density polyethylene sheets and films easily recyclable as it can be melted down into liquid form and it is much more commonly recycled. These factor will drive the growth of market of sheet and films in the forecast period.
High-Density Polyethylene Market Segment Analysis – By End Use
Building and construction sector held the largest share in the high-density polyethylene market in 2019 growing at a CAGR of 6%. The increasing use of high-density polyethylene in various construction material such as sheets and films for windows, flooring, roofing, cover building materials and seal off rooms is expected to surge the demand for high-density polyethylene from the building and construction sector. The growth of high-density polyethylene can be taken as directly proportional to the growth of construction industry. By 2020, construction output is estimated to grow by 70% to $12.7 trillion and will account for 14.6% of the world output with some of the larger emerging markets such as China, India, Russia, Brazil and Poland driving growth, along with U.S. Global GDP growth of 3.5% and 3.6% is expected in 2017 and 2018 respectively however the meteoric growth that outpaces global GDP will be concentrated in countries like China, India and U.S. India will overtake Japan as the third-largest construction market with annual growth averaging 7.4% annually in construction. These factors will drive the growth of market in the forecast period.
High-Density Polyethylene Market Segment Analysis – By Geography
APAC dominates the high-density polyethylene market with a share of 40% followed by North America and Europe. The economy of APAC is mainly influenced by the economic dynamics of countries such as China and India, but with growing foreign direct investment for economic development of South East Asia, the current scenario is changing. Countries in South East Asia are witnessing high growth in the automotive sector. In automotive sector, high-density polyethylene are used in insulation. The growth of the high-density polyethylene can be attributed to the rise in production of automobiles. It is expected that the amount of high-density polyethylene used in the production of automobiles will double in the next 15 years. According to International Organization of Motor Vehicle Manufacturers the total production of automobile (commercial as well as Personal) globally in the year 2019 was 91,786,861 units compare to 96,869,020 units in 2018. This will drive the market of high-density polyethylene in the forecast period.
The coronavirus pandemic has had far-reaching consequences beyond the spread of the disease and efforts to quarantine it. South Korea, Italy and Japan are the most affected among the major industrialized economies. Consequently, 80 percent of automotive and related companies report that Coronavirus will have a direct impact on their 2020 revenues. 78 percent of companies do not have enough staff to run a full production line. More than 80 percent of the world’s auto supply chain is connected to China. In January 2020 China’s car sales plunged by 18 percent. The China Passenger Car Association (CPCA) considers that the first two-month sales could decline by 40 percent or more compared to the same period in 2019. Production shortfalls resulting from supply chain disruptions in China will impact global automakers. This factor will hinder the growth of market for the year, but when situation became normal it will grow with a steady rate.
High-Density Polyethylene Market Drivers
Rise in demand of high-density polyethylene from electrical and electronics industry
The use of high-density polyethylene is rising in electrical and electronics industry. High-density polyethylene are highly preferred for electrical insulation and film packaging. The digital economy supported the development of many electronic appliances such as smart phones, watches, TVs, refrigerators, security systems, and environmentally-friendly electric vehicles. The energy consumption in Asia-Pacific is expected to grow by 48% over the next three decades. According to IEA, China alone is expected to contribute to 30% of the world’s energy increase until 2023. Increasing usage of electricity in industries, growing electronics and electrical production are expected to drive the market for high-density polyethylene in the forecast period.
Mass consumption of high-density polyethylene in automotive and construction industries
The increase in global automobile production is a major factor which influence the growth of high-density polyethylene market across the globe. High-density polyethylene ls are available in different densities with the ultra-high molecular weight grade, offering toughness that outlasts steel in some applications. This, in turn, contributes to the growing demand for high-density polyethylene from the automotive industry. According to the World Economic Forum the Middle East and North Africa region is undergoing a transformation of urbanization trend that will see a very large number of people moving to key cities. The construction industry in these region are increasing at the rate of 10%. Thus it will augment the consumption and growth of high-density polyethylene in Middle East and North Africa regions.
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High-Density Polyethylene Market Challenges
High manufacturing cost can restrict the growth of the market in the forecast period
The manufacturing cost of high-density polyethylene is high which yields into high cost of finished goods. Secondly, the raw material which is used in the production of high-density polyethylene is also costly. The production of these materials require high skilled labors because of the high accuracy of temperature adjustment needed in there manufacturing. In present, there is no any substitute to reduce the price in production of high-density polyethylene. These are the major restraint which affect the market of polyethylene insulation materials in near future.
Production and decomposition of high-density polyethylene will degrade the environment
Producing high-density polyethylene takes a large amount of energy and also leads to high emissions of carbon dioxide, a greenhouse gas contributing to global warming and climate change. The high-density polyethylene takes a long time to break down and end up in landfill sites for decades. Any way to dispose of high-density polyethylene is incineration, which can result in harmful gas emissions. These are the major restraint which affect the market of high-density polyethylene in the forecast period.
High-Density Polyethylene Market Landscape
Technology launches, acquisitions and R&D activities are key strategies adopted by players in the high-density polyethylene materials. In 2019 the market of high-density polyethylene has been consolidated by the top five players accounting for xx% of the share. Major players in the high-density polyethylene materials market are Chevron Phillips Co, Formosa Plastics Corp., Honam Petrochemical, The Dow Chemical Co, Borealis AG, and Others.
Acquisitions/Technology Launches /Product launches
In October 2018, LyondellBasell launched high density polyethylene grades that outperform industry standards used in cable applications. Produced using LyondellBasell’s Hostalen ACP technology, the new Petrothene KR52828E grade is a multimodal high density polyethylene (HDPE) used in medium voltage jacketing for outdoor power cables.
Asia-Pacific dominates the high-density polyethylene market owing to increasing demand from building and construction industry.
Increasing use of plastic pipes as substituents and robust demand from the packaging Industry will drive the growth of market.
Oscillating crude oil prices will hinder growth of market in the forecast period.
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