ABS
Market, Supplier, Risk and
Competitive Intelligence

Industry Outlook & Drivers

Global ABS Market Outlook 

• Acrylonitrile Butadiene Styrene (ABS) is an engineering thermoplastic, which finds huge usage in various structured applications, owing to its excellent physical and mechanical properties. While the butadiene in ABS enhances strength and toughness, acrylonitrile improves chemical and thermal stability.
• ABS engineering thermoplastics are used in various applications, especially in automobiles. Around 12.5% of all automotive parts made of plastic including, steering wheel covers, and dashboards are derived from ABS resins. Also, ABS is used in pipe fitting and in making plastic sheets thanks to its mechanical properties. The thermoplastic is a core component in several consumer appliances such as control panels in appliances, refrigerator liners, and housing panels of vacuum cleaners and food processors. Further, it is used as a toy raw material as well as in the chemical industries.
• The global ABS market size is expected to expand at approx. 2-3% CAGR during 2019-2024.
• Automobile electronics, electronics, and smart consumer, and home appliances are major consumers of ABS.
• 3D printing technology is offering huge potential for ABS manufacturers
• The rising disposable income of the middle-class population in Asia is expected to further drive ABS consumption in the appliance, electronic, and auto electronics industries.

Demand Market Outlook

The automobile and appliances markets are expected to drive the demand for ABS in NA and Europe, while in Asia, the electronics segment would be the key driver, followed by the appliances and automobile segments. 

Usage of lightweight automobiles is surging across the world owing to the rising need to control carbon footprint for better energy efficiency. ABS is extensively used to manufacture various vehicle components such as interiors, seating, bumpers, and center consoles, given its high strength, chemical resistance, and lightweight aspects. 

The use of polymers in the automobile industry is increasing. Automobile companies are finding it easier to design cars thanks to the use of plastics like ABS. Also, regulatory demands to reduce automobile weight to bring down emissions is another positive factor that would help in the growth of the ABS industry. It is also an economic solution that meets their needs. The automobile sector is itself likely to witness increased growth, particularly in China, Taiwan, US, Indonesia, and Germany. This growth will have a positive impact on the demand for ABS resins.

Industry Best Practice

• Fixed margin-based pricing is generally preferred by buyers who procure lesser volume. The manufacturer tries to maintain its desired profit margin, within a range of 15–20 percent. When the prices of the raw materials change, the manufacturer looks at the overall input cost incurred in manufacturing the ABS resin, and applies their margin, subject to the market condition.
• Index-based pricing: Some of the suppliers peg the price of their ABS resin to the raw material styrene prices, as it accounts for 50 percent of the cost-contribution. Any change in the styrene prices is subsequently incorporated in the ABS resin prices during the review period.

Global ABS Market Size

• The global ABS market is anticipated to reach approx. $23 billion by 2023, primarily driven by automobile, appliance, and electronic sectors.
• The global ABS market is expected to grow at a CAGR of 9% from 2017 to 2023, with Asia as the center of demand growth.
• China is expected to remain the key driver for the ABS market, in terms of consumption and production.
• The trend of lightweight vehicles is expected to boost the demand in China, With the new regulations banning the import of scrap plastics, the growth of consumer electronics is a potential pedestal for ABS growth.

Global Capacity–Demand Analysis

• Asia, being the largest demand center, is expected to drive the ABS market from the appliance and electronic downstream sectors.
• The innovative fields of the auto electronic market growing at approx. 12–14 percent could be the potential platform for ABS application.

Market Outlook

• ABS capacity in North America remained at 0.94 MMT occupying around 8% of the global capacity share.
• Demand is expected to grow at 2.8% until 2023, supported by the projected growth in automobile and appliance markets.
• ABS is also a preferred resin in electric vehicles in line with stringent environmental regulations, especially in Europe.
• Automobile sector: 5% growth, driven by replacement of painted heavy parts by light-weight ABS resins in dashboards, and wheel casings.
• Home appliance market growth: Domestic, kitchen, and home comfort appliances at 6-7% and smart consumer appliances at approx. 7%.
• The electronic components market, which includes wiring boards and enclosures, is expected to grow by around 8-9%.
• Capacity additions are expected to come up more in Asia (from Trinseo and CNOOC & LG Petrochemical). Versalis is expected to increase its capacity in Italy by 75,000 tonnes.

Engagement Outlook

• Emerging Asian regions could be considered as favorable destinations of sourcing owing to upcoming capacity additions and a strong supply base. However, the US-China trade conflicts hit the demand for China-made electronics during 2018-2019.

ABS Global Demand by Application

On a global scale, automotive, appliance, and electronic are the major demand drivers.

Demand is expected to grow at 2.8% until 2023, primarily supported by automobile, printed wire board, and smart consumer appliances. 

The COVID-19 pandemic has pushed the demand for ABS in medical and consumer goods industries in applications such as the manufacturing of medical devices and musical instruments, and household appliances.

Low melting point of ABS makes it ideal for 3D printing and injection molding. Emerging use cases of ABS in 3D printing in tandem with increasing demand for desktop 3D printers will contribute to the overall bottom line of manufacturers or ABS suppliers. 

Furthermore, ABS is a great alternative to PVC in construction applications such as flooring, tubes, and pipes.

ABS Market Overview 

• As Q4 2019 settled, stable and sufficient supply levels, softer demand sentiments, and lower feedstock prices supported a decline in ABS prices.  However, buying momentum is likely to remain cautious and volatile.

• The presence of ample supplies, both domestically and from imports, high inventories, and poor demand drive, along with lower feedstock styrene prices, may support a decrease in ABS financing prices. Concerns of supply issues from ACN may curb a strong decrease.

• Increasing trade tensions between the US and China and the possibility of a trade demand between the two nations could continue the cautiousness in buying asset-backed securities volume.

ABS Industry Drivers 

• Metal replacement in automotive, and electrical and electronics industries is a key application area of ABS resins. The need for lightweight and high-performance materials is driving the demand for ABS in these sectors citing the intensifying need for fuel efficiency.
• Demand for home appliances and electrical/electronic goods made of ABS is increasing in emerging nations such as China and India owing to the rising middle-class population.
• With the rapid development of China's Information Communications Technology (ICT) sector, the country has become the global leading manufacturing center for electronic products, including televisions, computers, handsets and DVD players. This development is further pushing the demand for ABS in the electronic segment.

ABS Industry Constraints

• ABS suppliers and manufacturers are seeing threats of various substitutes in the market such as styrene-butadiene rubber (SBR). SBR exhibits the properties of rubber including umpteen abrasion resistance, which are crucial for manufacturing tires and other automobile components. 
• The UN Environment Program (UNEP) states that 79% of the plastic waste is disposed of in the surroundings, resulting in plastic pollution. Stringent government norms regarding environmental protection and reduced usage of non-renewables are negatively impacting the growth of the global ABS industry.
• The slowdown in major economies: A slowdown in China’s manufacturing activities and contraction of the Brazilian economy could have a negative impact on the global demand for engineered resins.
• The impact of the COVID-19 pandemic on the economies of several countries, especially developing countries, is likely to hinder the adoption of ABS.

ABS Innovations

Innovations in the global ABS market are fueled majorly by light-weighting, cost reduction, performance, and sustainability needs.

Natural fiber-reinforced ABS

Sustainability through Natural Fiber Reinforced ABS

• In Nov 2015, Elix Polymers introduced Elix ECO ABS-NF, a natural fibre reinforced ABS composite material for injection moulding applications and specific extrusion process.
• The product can be processed without the need to modify machines. The key features are high stiffness, heat resistance, low molding shrinkage ratios, low emissions, and lower weight compared to glass fibre reinforced ABS.
• Elix has received EEA and Norway Grants, the first time, a European ABS market producer is given a grant to investigate new sustainable ABS materials and composites.

Laser-weldable high-heat ABS

• In May 2016, INEOS Styrolution and Japan’s Ichikoh (a manufacturer of lamps and mirrors for automobiles) jointly developed a laser weldable high heat ABS for rear lamp. 
• The new rear lamp housings development has enhanced optimal aesthetics, better performance, and lower costs as a result of processing innovations (a new laser welding technique developed by Ichikoh and a unique styrenic polymer solution from INEOS Styrolution).

ABS Challenges And Opportunities

Challenges: Substitution in 3D printing from PLA resins, increasing the demand for silicone elastomers as insulation materials. 

Opportunities: Shift in manufacturing base to demand center (Asia)

Why You Should Buy This Report

Find information about the ABS market outlook, ABS market data, demand analysis, ABS trend, trade dynamics, import, export, etc. of regional and global markets. Porter’s five forces analysis of North America, Europe, and Asia. Industry drivers and constraints, major events and innovations, ABS market news, ABS market share. Asset-backed securities market cost structure, price forecast. Supplier analysis with SWOT analysis of major players like LG Chem, CNPC, Formosa Chemicals, etc. Best abs finance industry practices and contract structures.