Polyethylene Terephthalate (PET) Resin Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Polyethylene Terephthalate (PET) Resin Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The polyethylene terephthalate (PET) resin market was estimated at over 80 million ton in 2021, and it is projected to register a CAGR of over 5% during the forecast period (2022-2027).

The COVID-19 pandemic had a negative influence on the market. Several nations went into lockdowns due to the pandemic, causing supply chain problems, labor shortages, and work stoppages. Various end-user sectors, including electrical and electronics, consumer products, food and beverage, and others, were badly hit as a result of this. The demand for polyethylene terephthalate resin suffered as well. Automobile manufacturing climbed by 9.8% in the first nine months of 2021 compared to the previous year, according to the OICA. In 2022, the situation is anticipated to improve, restoring the growth trajectory of the market.

Over the short term, the growing food and beverage industry, increase in PET collection and recycling rates in Europe, and demand for sustainable and recyclable materials are likely to drive the market's growth. The food industry has been witnessing robust growth in the Asia-Pacific and Middle-East and African regions. The rising income levels and the increasing population levels are the primary factors driving the growth of the food industry in these regions. With huge scope for growth in these regions, new investments are being observed in the food and beverage sector, which is intended toward setting up individual confectionery, food processing, and beverage producing facilities.

On the flip side, stringent regulations regarding the usage of PET and increasing usage of substitute products, such as high-density polyethylene, are expected to hinder the growth of the market studied.

The shift toward flexible packaging and the advent of bio-based PET are likely to act as opportunities for the market's growth in the future.

The bottles segment accounted for the largest market share of more than 50%. It is estimated to register a healthy CAGR during the forecast period.

As polyethylene terephthalate (PET) is an excellent water and moisture barrier material, plastic bottles made from PET are widely used for mineral water and soft drinks (low and high carbonated).

Apart from the above-mentioned applications, PET bottles are also used for alcoholic beverages, agro-chemicals, cosmetics and pharmaceuticals, edible oil, etc.

PET bottles are also recycled for various purposes. For example, they are used in solar water disinfection in developing nations, in which empty PET bottles are filled with water and left in the sun to allow disinfection by ultraviolet radiation. PET is useful for this purpose because many other materials (including window glass) that are transparent to visible light are opaque to ultraviolet radiation.

According to IBWA, bottles were the largest beverage category by volume in 2020. Around 23% of the bottles are utilized for water storage purposes in the United States.

PET bottles filled with sand, dirt, fly ash, or any other material such as domestic plastic garbage, when adequately compacted, may be used as a construction material instead of conventional bricks, according to the Indian Journal of Science and Technology.

Owing to the investments from the polyethylene terephthalate manufacturers in Saudi Arabia, the production capacity of PET resin is expected to increase in the coming years. For instance, in January 2019, Pan-Asia PET Resin (Guangzhou) Co., one of China's leading PET bottle suppliers, launched a SAR 3.9 billion-worth manufacturing plant in the country, which produces PET and PTA used in the packaging and fabric industries. Such investments are likely to boost the demand for PET resins in the bottles segment.

All the aforementioned factors are expected to increase the demand in the PET resin market during the forecast period.

The PET market in the Asia-Pacific region is driven by factors such as population growth, the rise in disposable income, urbanization in developing economies, and growing demand for fast-moving consumer goods.

China is a major producer of PET resins, with PetroChina Group and Jiangsu Sangfangxiang being among the largest global manufacturers in terms of volume, with capacities of more than 2 million ton.

The use of engineering plastic products in the packaging sector (PET containers, bottles, etc.) is increasing at a tremendous rate due to their advantages over conventional packaging plastics used. The demand from industries like food and beverage, consumer goods, and others for packing materials is increasing in China, owing to the increasing exports and domestic consumption.

China's food and beverage consumption has evolved dramatically over the past 40 years, and it gradually transformed from an industry-driven to a consumption-driven market.

The Asia-Pacific electronics industry grew rapidly in the recent past due to the high demand from countries like India and China. China is a strong, favorable market for electronics producers due to the country’s low labor cost and flexible policies.

Asian PET bottle markets have remained under pressure from a combination of plentiful supplies and buying resistance amid rising COVID-19 cases. However, the situation has changed since 2021, as flexible packaging is opted by many industries due to hygiene issues.

All the aforementioned factors are expected to increase the demand for PET resin in the region during the forecast period.

The PET resin market is a semi-consolidated market. The major players in the market include Indorama Ventures Public Company Limited, Alpek SAB de CV, Sinopec Group, Far Eastern New Century Corporation, and CR Chemical Materials Technology Inc., among others.

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support