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The last few years have witnessed a strong growth in automotive
and electronics sector in China. Extremely good growth has been
omnipresent in the areas of automobiles and electronic/electric
business machines.
In the past decade, overall economic growth has been more than
8-10%, leading to large scale expansion of manufacturing base. Global
production capacities lead to higher plastics demand, not only for
commodity grades like Polyolefins, Vinyls and Styrenics but also
in the areas of Engineering Thermo Plastics (ETP). Growth in commodity
plastics have slowed down to about 10% in the last few years while
ETPs have started growing at almost 15-20% in the last 5-10 years.
PolyAmides, Polycarbonates, PBT and POM are showing good growth
potential, mainly due to the continuous development of indegenous
moulding capability to meet local requirement.
China has very fragmented and small-sized compounders who are
still to develop technical skills. Inadequate technology to meet
the stringent international requirements of its vendors makes China
dependent on imports of ETP. Until recently, most of the big international
players like Bayer, Dupont, and GE Plastics were concentrating their
manufacturing activities in North America and Western Europe because
of the well developed markets. However, these players are increasingly
investing in developing newer capacities in China to take advantage
of the growing market. It is estimated that almost 75% of imports
of ETP in the beginning of 2000 will drop to about 30% by the end
of this decade. Of course, the total import quantity in absolute
terms will increase due to growth of ETP by an average of 15% every
year.
No wonder that most of the important international players have
established good facilities in China. However, some good Chinese
compounders (almost 25-50) from the total of more than 1000 would
acquire the technology and provide competition to these international
players.
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