An Overview: Plastic & Polymer Industry
Plastic is the term used to define a wide range of synthetic and semi-synthetic organic products. Plastic products find its application in the household as well as industry. This can be attributed to its low cost, ease of production and non-reactivity to water. It is generally derived from petrochemicals and hence Oil Marketing Companies (OMC) are the major suppliers of plastic & polymer raw materials.
Plastic industry is significantly contributing to the growth of Indian economy finding its usage in key industrial sectors — automotive, textile, furniture, construction, electronics, healthcare, packaging, irrigation, agriculture, etc. Domestic consumption of plastic is on rise and is growing annually at more than 10% CAGR. However, compared to the developed nation India still lag behind average plastic consumption.
Source: PlastIndia, Business Press, Research by Tata Strategic
Growing industrialization, increased per capita income and living standard offers a huge opportunity for the sustained growth of plastic industry in India.
Categorization
A wide variety of plastic raw materials is produced to meet the needs of different sectors of the economy. Polymer raw materials are categorized into a commodity, engineering and speciality plastic.
Commodity polymers are the major derivatives of petrochemicals. Major commodity polymers are Polyethylene (PE), Polypropylene (PP) and PolyVinlyChloride (PVC). Engineering and speciality polymers show enhanced mechanical and thermal properties compared to commodity polymers and are used for specific purposes. Types of engineering polymers are — Acrylonitrile Butadiene Styrene (ABS), Polyethylene terephthalate (PET), Polytetrafluoroethylene(PTFE), Nylon and Polystyrene derivatives.
PE is further categorized in Low-density Polyethylene (LDPE), High-density Polyethylene (HDPE) and Linear Low-density Polyethylene (LLDPE).
Domestic plastic consumption & output
Annual consumption by types.
Polymer Type Growth Rate (per annum) Output in FY13 (MT) Polyethylene (PE) 8% 3.6 Polypropylene (PP) 2% 2.1 Polyvinyl Chloride (PVC) 10% 2.1 Poly- Styrene (PS) 3% 0.25 Acrylonitrile Butadiene Styrene (ABS) 7% 0.15
Plastic consumption by application
Consumption by region
Western India has traditionally been the largest consumer of plastics accounting for almost 47% of the total consumption.
Processing Techniques
Polymer raw materials undergo processing in order to form finished products. Major processing techniques utilized in polymer industry are extrusion, injection moulding, blow moulding and roto moulding. Product outcome of various processing techniques is as below
Processing Technique Finished Products Extursion Films and Sheets, Fibre and Filaments Pipes, Conduits and profiles, Miscellaneous applications Injection Moulding Industrial Injection Moulding, Household Injection Moulding, and Thermoware / Moulded luggage Blow Moulding Bottles, containers, Toys and Housewares Roto Moulding Large circular tanks such as water tanks
Major Producers
Major plastic raw materials are the petrochemical extraction and marketing firms. Reliance Industries is the largest private producer of plastic raw materials. Whereas IOCL, Haldia, GAIL and BPCL are key public players.
Production capacity of plastics by major players, Fy13
Producer PE PP PVC Others RIL 11,65,000 27,00,000 6,50,000 IOCL 6,50,000 6,00,000 GAIL 5,05,000 HPL 7,10,000 3,90,000 Chemplast Sanmar 2,50,000 Finolex 2,70,000 Supreme 2,72,000 Ineos ABS 60,000
Opportunities & Challenges
Factors like low per-capita consumption, manufacturing focus, end use industry growth, availability of feedstock, increasing urbanization, changing lifestyle, demographic dividend etc. are promoting the growth of plastic across India. While Indian plastic industry is booming and is one of the fastest growing markets in the world, its further advance is marred by the skilled workforce and power supply.
Skilled Workforce is the major challenge area for the plastic industry which has led to the investment in automation and conveyor belt system. Currently, the plastic industry faces power deficit of 12–13%. This offer excellent opportunities for firms from developed nation offering energy saving solutions, power saving machines, and ancillary equipment.
Conclusion
Plastic offers a great substitute for many traditional materials such as wood, paper, metal, glass and ceramic. India still lags behind developed nations in agriculture plastic application. While challenges in the form of skilled labour, power deficit remains overall outlook of Indian plastic industry looks bright with growing per capita income and more acceptability of plastic in day to day use.
Originally published at www.ofbusiness.com.