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Market Overview

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The global additive masterbatch market is expected to experience significant growth, with a projected Compound Annual Growth Rate (CAGR) of 6.35% during the review period. In 2021, the market was estimated to be worth USD 2.13 billion, and it is predicted to reach USD 3.79 billion by the end of the forecast period (2022-2030).

Additive masterbatches are granular concentrates used to modify thermoplastics. They are composed of a polymer-specific carrier resin and one or more additives. These additives can include antimicrobial, antioxidant, and flame retardant agents. Plastics degrade mainly due to oxidation and thermal aging, leading to a loss of mechanical properties. Antioxidant masterbatches are developed to prevent thermo-oxidative breakdown during the manufacturing, drying, processing, and final use of plastics, particularly in PP, LDPE, and HDPE. Flame retardant additive masterbatches work by preventing surface oxygen.

The ongoing COVID-19 pandemic has sparked a global focus on personal hygiene and health. This has resulted in a significant increase in demand for a virus-free environment across various industries, including packaging, textiles, industrial, and medical applications.

Concentrated masterbatches, which consist of pigments and/or additives melted into a carrier resin and then granulated, play a crucial role in the plastics manufacturing process. They enable cost-effective coloring of raw polymers. However, recent years have seen severe supply difficulties due to factors such as storms and the COVID-19 epidemic. As a result, many businesses are working on shortening their supply chains, which were highly vulnerable to disruption. Around 90% of healthcare, engineering, construction, and infrastructure firms plan to regionalize their supply chains within the next three years. Shorter, more secure supply chains that involve vertical integration or partnerships with multiple operators across different nodes of the supply chain can help businesses increase profits through proactive risk management and optimization.

Although disruptions to the supply chain are inevitable, past experiences provide reasons for optimism. The COVID-19 pandemic exemplified the risks associated with cost-effective, lean supply chains and underscored the importance of improving supply chain resilience. Companies that were able to effectively monitor and map their suppliers had a clear understanding of how the crisis affected their supply chains, allowing them to prepare for disruptions. Some companies even managed to avoid any negative consequences.

The demand for additive masterbatch is particularly high in the packaging industry. Additive masterbatches enhance the properties of plastics by adding color and other essential features. In the packaging industry, masterbatch is widely used as a cost-effective method of producing packages, thus increasing productivity and reducing production costs. Different types of additive masterbatches, such as calcium carbonate masterbatch and color masterbatch, are combined with transparent or recycled plastic to meet specific requirements. For example, color masterbatch enhances the packaging’s visual appeal, vibrancy, and durability in harsh weather conditions.

Antimicrobial additive masterbatches are also gaining popularity in the plastics industry. These additives provide improved protection against harmful bacteria, biofilm, fungi, staining, malodors, and mold, while maintaining the structural and physical properties of the product and extending its shelf life. The extensive properties offered by additive masterbatches in the packaging industry drive the demand for plastic packaging films, thereby influencing the growth of the additive masterbatch market.

Furthermore, industrial sectors in emerging economies, such as India, Indonesia, Brazil, Mexico, and other developing countries, are experiencing rapid expansion. The growth of these markets can be attributed to recent exponential economic growth and significant expansion in manufacturing industries, including automotive, packaging, chemicals, construction, textiles, consumer goods, and pharmaceuticals. Among these sectors, packaging accounts for the largest market share of the overall additive masterbatch market, with a share of 39.75% in 2021. Initiatives like Make in India, aimed at promoting investment, innovation, skill development, and manufacturing infrastructure, have contributed to the growth of the packaging industry in India. With a 35% annual growth rate in the last three years, Indian companies in the packaging industry have achieved a 12% annual revenue growth, impacting the additive masterbatch market in the country.

Fluctuations in raw material prices also affect the additive masterbatch market. The raw materials used in masterbatch production, such as polymer resin, calcium carbonate, titanium dioxide, and carbon black, are derived from crude oil. Consequently, changes in crude oil prices directly impact the cost of carrier resin for additive masterbatch production, particularly polypropylene. Therefore, price fluctuations in crude oil affect the overall additive masterbatch market.

The increasing demand for anti-UV additive masterbatch is another significant factor driving market growth. These masterbatches, which contain ultraviolet stabilizers, protect plastic products from degradation and discoloration caused by exposure to harmful UV rays. Sunlight, UV rays, heat, and oxygen can reduce the quality and lifespan of plastics. Anti-UV additive masterbatches prevent color changes, cracking, chalking, and UV degradation, while improving elongation, mechanical strength, and processability.

Stringent government regulations pose challenges to the additive masterbatch market. Although plastic and its derivatives are widely used in packaging, concerns about their environmental impact may lead to restrictions on their usage. Additionally, the hazardous nature of flame retardants can prompt governments to impose limitations on the use of these toxic additives, thereby impacting the additive masterbatch market in the forecast period.

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Market Segmentation

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The market is segmented based on various factors, including carrier resin, type, application, and region.

Segmentation by Carrier Resin
Polyethylene (PE)
Polypropylene (PP)
Polystyrene (PS)
Polyvinyl Chloride (PVC)
Polyethylene Terephthalate (PET)
Other

Segmentation by Type
Antimicrobial
Antioxidant
Flame Retardants
Others

Segmentation by Application
Packaging
Building & Construction
Automotive
Agriculture
Consumer Goods
Others

Segmentation by Region
North America
Europe
Asia-Pacific
South America
Middle East
Africa

The market for additive masterbatch is segmented by carrier resin into polyethylene (PE), polypropylene (PP), polystyrene (PS), polyvinyl chloride (PVC), polyethylene terephthalate (PET), and others. The leading and fastest-growing segment is polyethylene (PE), which generated a value of USD 692 million in 2021 and achieved a CAGR of 32.53% during the review period. This segment’s popularity is due to its durability, strength, and toughness. In 2021, polyethylene held a market share of 32.53% and is projected to register a CAGR of 7.10% during the forecast period. Polyethylene additive masterbatch comprises a unique blend of base polyethylene, elastomeric olefins, and active additives. This composition acts as an adhesion promoter in the production of stretch wrap films from LLDPE or LDPE, both of which have a high molecular weight. The presence of polyisobutylene, polyethylene, and matrix results in excellent adhesion in dry, free-flowing granules, eliminating odors from household packaging, post-agricultural films, decayed waxes, elastomers, and plasticizers. The re-granulating process also reduces odor.

Based on type, the market is further divided into antimicrobial, antioxidant, flame retardants, and others. The antimicrobial segment is anticipated to exhibit the highest CAGR of 37.52% and reach a value of USD 798 million by the end of 2030. Antimicrobial additives are utilized to protect products from harmful bacteria, biofilm, fungi, staining, malodors, and mold without compromising the structural and physical properties of the product.

In terms of application, the market is categorized into packaging, automotive, consumer goods, building and construction, agriculture, and others. The packaging segment accounted for 39.75% of the overall market, with a value of USD 846 million in 2021. Polypropylene additive masterbatches find widespread use in the chemical and agriculture sectors, such as packaging food, animal feed, chemicals, seeds, and fertilizers. It offers properties like toughness, resistance to stretching, good printability, waterproofness, and non-greasiness.

The global additive masterbatch market spans across five regions: North America, Europe, Asia-Pacific, Latin America, and the Middle East & Africa. Among these regions, North America held a 22.5% market share in 2021 and is projected to exhibit the highest CAGR of 5.90% during the review period. This growth can be attributed to rapid industrial expansion and improving economic conditions of consumers in the region.

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Competitive Landscape

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The global additive masterbatch market exhibits a noteworthy presence of numerous regional and local vendors, resulting in intense competition as each player strives to capture a significant market share. The primary driver of market growth is the escalating demand for additive masterbatch in industries such as packaging, building, and construction. Vendors engage in competition based on factors such as cost, product quality, and geographical availability. To remain competitive, vendors must offer cost-effective and high-quality additive masterbatch solutions. The market landscape is fragmented, encompassing tier-1, tier-2, and tier-3 companies, with tier-1 and tier-2 companies accounting for more than 60% of the global market share.

The growth of market players relies on factors such as market and economic conditions, government regulations, and industrial developments. Therefore, players should prioritize expanding their production capacity to meet increasing demand and enhance their services. Key companies operating in the market include LyondellBasell Industries Holdings B.V., Avient Corporation, Plastika Kritis S.A., Plastiblends India Limited, and Dow. These companies compete in terms of product quality, pricing, and availability, with a strong focus on additive masterbatch development. While international players predominantly dominate the market, regional and local players with smaller market shares also maintain a moderate presence. International players, with their global footprint and established manufacturing units or sales offices, have bolstered their presence across major regions such as North America, Europe, Asia-Pacific, Latin America, and the Middle East & Africa.

Key companies profiled in this report include LyondellBasell Industries Holdings B.V., Avient Corporation, Plastika Kritis S.A., Plastiblends India Limited, Dow.

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Key Questions Answered

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What is the projected growth rate for the global additive masterbatch market in the future?

The global additive masterbatch market is projected to achieve a growth rate of 6.35% in the future.

Which industry is expected to play a pivotal role in driving the advancement of the additive masterbatch market?

The packaging industry is expected to play a crucial role in propelling the growth of the additive masterbatch market.

What is the primary restraining factor for the global additive masterbatch market?

The primary restraining factor for the global additive masterbatch market is the fluctuation in raw material prices.