Polycarbonate

Global Market Outlook on Polycarbonate

• The global demand is expected to grow at 3.4 percent CAGR through 2022–2025

• Blends of PC with other polymers, particularly ABS, polyester, and thermoformed PC films are expected to be the demand drivers during the period

Demand Market Outlook

• Even though the global PC market is currently oversupplied, the absence of required additions inline with the expected improvement in demand may lead to higher operating rates within the suppliers during the forecast period.

Industry Best Practice : Polycarbonate

Engagement Models

• Direct buying is the preferred engagement model in the industry

• CPG companies outsource its packaging requirements to the converters, as it helps to focus on its core business

• Consortium buying is not a common practice for the CPG suppliers in the resin market

Contract Models

• Market Price Contract: The supplier supplies the commodity at a market price or benchmark price

• Fixed Contract: The margin of a supplier is fixed throughout the contract period or fixed price is locked for the contract period

• Contract Revisions: Quarterly contracts are generally preferred in this industry

Pricing Formula

• Based on Monomer Contract Prices

P (PC) = Monthly contract prices for feedstock + Fixed component + Premium

• Based on Index Prices

P (PC) = Resin prices quoted in the index for the month [CMAI/CDI/Platts] +/- margin%

Producer margins are observed to be the highest in North America (20–25 percent) followed by Europe (15–18 percent) and Asia (12–15 percent)

P (PC) = Resin index prices for the month + Conversion cost + Margins

Global Market Size: PC

• The global PC market is forecasted to grow at a CAGR of 3.1 percent over 2022 to 2025 to reach $17.6 billion by 2025

• Major drivers, such as applications in automobile, electrical and electronics segment, etc., help in the development

• Growth in consumer goods applications is anticipated to remain modest during the period

• The COVID-19 pandemic had an impact on the global polycarbonate market in 2020, as the lockdown measures and supply chain disruptions caused a decline in demand. However, the market is expected to recover in 2021 and beyond as the global economy recovers from the pandemic. In 2021, the demand for polycarbonate increased due to the growing demand for lightweight and durable materials in various end-use industries, especially in the automotive and electronics sectors.

Polycarbonate Global Capacity–Demand Analysis

PC demand during the forecast period is projected to witness a CAGR of 3.4 percent, owing to growth in electronics, packaging, and medical applications

Market Outlook

• The global PC market had a total capacity of 6.58 MMT as of 2021.

• There has been a high-capacity rationalization of PC in the US and Europe in the past, which had created some deficit in production, especially in Europe

• Recently, China witnessed PC capacity addition of 0.10 MMT.

• Capacity additions planned in Asia during FY 2020 are pushed to FY 2021. Capacities of about 0.93MMT is expected to have come online during 2021

Engagement Outlook

• European and Asian buyers are recommended to engage in contractual buying.

• For imported materials, the buyers may look for imports from the US, South Korea, and Saudi Arabia, as these regions are likely to remain as a net exporter during the forecast period

Cost Structure Analysis : Polycarbonate

• Feedstock phenol is the major cost driver in the prices of PC. Any price change in Phenol will have a major impact on the prices of PC.

• North America continues to have cost advantage on raw material front

• Utility cost includes electricity, steam, water, and fuel/gas. Among these, electricity is the main utility that accounts for most of the cost incurred

• Utilities and labor costs were observed to be low across all the geographies

Why You Should Buy This Report

The polycarbonate market research report gives the cost structure breakdown, polycarbonate price trends and forecast analysis. It gives the regional capacity share by suppliers and does a SWOT analysis of major players like Covestro, Sabic IP, Trinseo, etc. It details the polycarbonate industry drivers, constraints and technological innovations.