(I-BusinessNews.Com, April 17, 2021 ) Plastic Straps Market size is forecast to reach $6.2 billion by 2026, after growing at a CAGR of 18.5% during 2021-2026, owing to the increasing usage of plastic straps such as polyester straps, polypropylene straps, and nylon straps in various end-use industries such as automotive, infrastructure, electronics, paper, and more. The demand for plastic straps is increasing in these end-use industries owing to various properties offered by them such as high flexibility, ease of handling, lightweight, and more. The rapid growth of the electrical & electronics industry has increased the demand for plastic straps; thereby, fueling the market growth. Furthermore, the flourishing paper, automotive, and construction industry is also expected to drive the plastic straps industry substantially during the forecast period.
COVID-19 Impact
The COVID-19 pandemic outbreak is having a huge impact on the automotive and electronics industry. There is a delay in imports and exports of electronic items due to the import-export restriction by the governments in various regions. Besides, the production of automobiles has been disruptively stopped, contributing to a major loss in the total automotive sectors. According to the European Automobile Manufacturers Association, In June 2020, demand for new commercial vehicles across the EU remained weak (-20.3%), although the rate of decline slowed compared to April and May in 2020. Three out of the four largest markets in the region posted double-digit percentage declines last month: Germany (-30.5%), Spain (-24.2%), and Italy (-12.8%), while France recorded a modest increase (+2.2%). With the decrease in automotive production, the demand for automotive packaging has significantly fallen, which is having a major impact on the plastic straps market.
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Plastic Straps Market Segment Analysis – By Type
The polypropylene straps segment held the largest share in the plastic strap market in 2020 up to 28%, owing to the various advantages that it offers such as high tensile strength, increased flexibility, lightweight, easy handling, excellent elongation, chemical resistance, rustproof, and more. In addition, polypropylene increases the Security and aesthetic appearance of the goods. Also, it is suitable for all types of strapping machines both automatic and semi-automatic strapping machines as it is steady against temperature fluctuations from -10 to +50 C. Polypropylene is often recyclable and is, therefore, an environmentally friendly alternative. Thus, all these extensive characteristics of polypropylene straps are the key factors anticipated to boost the demand for polypropylene-based straps in various regions during the forecast period.
Plastic Straps Market Segment Analysis – By End-Use Industry
The paper segment held the largest share in the plastic straps market in 2020 and is growing at a CAGR of 18.7%, owing to the increasing usage of plastic straps such as nylon straps and polyester straps in the paper industry. For convenient handling and shipping of newspapers, plastic straps together with baling wire are used for bundling items. The increasing demand for plastic straps in the paper industry is also likely to drive the growth of the market in the coming years. Due to the increased production & distribution of different magazines and print advertising, newspapers and graphics have been growing in emerging economies. This can be due to an increase in the number of pages of newspapers & rapid urbanization on specific occasions. In the packaging industry, newspapers and magazines are also used, which would therefore increase the uptake of paper straps materials in the newspaper and graphics application section. Thus, the increasing usage of plastic straps in the paper industry is the major factor driving the demand for plastic straps market during the forecast period.
Plastic Straps Market Segment Analysis – By Geography
Asia-Pacific region held the largest share in the plastic straps market in 2020 up to 45%, owing to the increasing demand for plastic straps from the paper, electrical, and electronics industry in the region. A total of 117 daily newspapers were in circulation, and the penetration rate was 0.7 newspapers per household as of October 2018, according to the statistics office and the Japan Ministry of Internal Affairs and Communications. In 2018, advertising spending amounted to 2.7 trillion yen in the four major types of mass media in Japan (newspapers, magazines, radio, and television). This accounted for 41.4 percent of the total spending on advertising, which was Â¥6.5 trillion (US$59.1 billion). According to the Electronic Industries Association of India (ELCINA), the total production of the electronics sector in India was Rs 387,525 crore (US$59.4 billion) in 2017-18, compared to Rs 317,331 crore (US$48.8 billion) in 2016-17, exhibiting a growth of about 22%. The consumer electronics and appliances sector in India is expected to become the fifth-largest in the world by 2025, according to Invest India agency. India could create an $800 billion to $1 trillion digital economy by 2025, and India’s digital economy could fuel 18-23 percent of overall economic activity by 2025. Thus, with the expanding electronics and paper industry, the demand for packaging of products will also subsequently increase, which is anticipated to drive the plastic straps market in the APAC region during the forecast period.
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Plastic Straps Market Drivers
Increasing Automotive Production
Automotive components such as wheels, components, car body parts, instruments, and spare parts need to be protected and packed on the highest possible and reliable level to avoid any damage or production delay. And therefore plastic straps provide the service to avoid any damage in the car components during handling, shipping, and storage. According to Organisation Internationale des Constructeurs d’Automobiles (OICA), the production of passenger cars has increased by 2.6 % in Malaysia in 2019. China is the world’s largest vehicle market, according to the International Trade Administration (ITA), and the Chinese government expects the production of automobiles to reach 35 million by 2025. According to Organisation Internationale des Constructeurs d’Automobiles (OICA), the production of passenger cars in Africa was 776,967 in 2018, which then increased to 787,287 in 2019, a total increase of 1.3%. Thus, increasing automation production will require more plastic straps for packaging car components, which will act as a driver for the plastic straps market during the forecast period.
Expanding Building and Construction Sector
Plastic Straps such as polyester straps are preferred over paper straps for building materials packaging as these straps are known for their greater elasticity and weather resistance capabilities and they perform well under shock loading. Thus, they are used for packing construction materials such as clay building bricks, roofing tiles, plasterboards, timber, chipboard, and plywood. In February 2020, total construction was at a seasonally adjusted annual rate of 1,366,697, which is 6.0 percent higher than the rate of 1,288,951 in February 2019, according to the US Census Bureau. The Chinese construction industry is forecast to grow at an annual average of 5% in real terms between 2019 and 2023, according to the International Trade Administration (ITA). In addition, the objective of the European Construction 2020 Action Plan was to stimulate favorable investment conditions. Due to various government initiatives, such as Foreign Direct Investments (FDI), construction and building activities are also increasing. Such investments by the governments are driving the construction sector in various regions. Thus, the expanding building and construction sector acts as a driver for market growth during the forecast period.
Plastic Straps Market Challenges
Fluctuating Raw Material Prices
The raw materials often used for the production of plastic straps are the downstream products of crude oil such as polyester and polypropylene. So, the price fluctuation of crude oils also hinders the price of plastic straps fiber raw materials. According to the BP Statistical Review of World Energy, the price volatility of crude oil has increased in the last year, as the price of crude oil increased from $43.73 in 2016 to $71.31 in 2018. And because of this uncertainty in crude oil prices, the price of polyester and polypropylene also increases. The volatility in crude oil prices leads to fluctuation of raw materials prices, which is expected to be a significant challenge for the plastic straps market manufacturers. Thus, the fluctuating raw material prices hinder the plastic straps market growth during the forecast period.
Plastic Straps Market Landscape
Technology launches, acquisitions, and R&D activities are key strategies adopted by players in the plastic straps market. Major players in the plastic straps market are Crown Holdings, The Sterling Group, Teufelberger, FROMM Packaging, Messersi Packaging, Dubose Strapping, Auto Strap, PAC Strapping Polychem Corporation, and Scientex Berhad.
Acquisitions/Technology Launches
In August 2020, Crown Holdings Inc. announced an initiative called Twentyby30, which it calls “a robust program that outlines 20 measurable environmental, social and governance (ESG) goals to be completed by 2030 or sooner.” The company vows to boost metal can recycling rates and use recycled content in plastic strapping.
In March 2019, The Sterling Group acquired Polychem Corporation. The company manufactures polyester (“PET”) and polypropylene strapping consumables, securement equipment and related products, serving the food and beverage, consumer packaged goods, and industrial industries.
Key Takeaways
Asia-Pacific dominates the plastic straps market, owing to the increasing electrical & electronics industry in the region. According to Invest India, India’s share in global electronics manufacturing has grown from 1.3% in 2012 to 3% in 2018.
Plastic straps have an advantage over metal, and paper straps in terms of weight and cost. Plastic straps are available and reusable at a cost-friendly rate, and their lightweight can reduce the overall weight of the packaged product, which can be of considerable benefit to logistics. These properties of plastic straps are projected to increase the market growth.
Due to the Covid-19 pandemic, most of the countries have gone under lockdown, due to which the projects and operations of various industries such as construction, paper, and automotive are disruptively stopped, which is hampering the plastic strap market growth.
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