Polyolefin Elastomers Market Size, Share & Trends Analysis Report By Type (Polypropylene (PP), Polyethylene (PE), Others), By Manufacturing Technique (Injection Grade, Extrusion Grade, General Grade), By Application (Films, Adhesives, Others), By End-Use Industry (Automotive, Packaging, Adhesives, Electronics and Electrical, Consumer Goods, Others (Footwear, Foams, Medical)) and By Region(North America, Europe, APAC, Middle East and Africa, LATAM) Forecasts, 2024 -2032

Market Overview

The global polyolefin elastomers market size was valued at USD 1,542.8 million in 2022 and is projected to reach a value of USD 2,982.8 million by 2031, registering a CAGR of 7.6% during the forecast period (2023-2031). The polyolefin elastomers market growth is anticipated by rising automotive industry demand.

Polyolefin is one of the polymers derived from olefins, wherein propylene and ethylene are widely used monomers to produce essential polymers such as polypropylene and polyethylene. Polyolefin elastomers are a new class of polymers with technological developments in the metallocene polymerization catalyst. Metallocene is an effective metal catalyst comprising tiny particles of positively charged metal ions sandwiched between cyclopentadienyl anions with formula (C5H5)2M where 'M' indicates the metal ion. Polyolefin elastomers possess excellent characteristics ranging from low to high molecular weight, amorphous to crystalline nature, enhanced elasticity, superior thermal stability, sturdy and increased durability, UV resistance, and low-temperature flexibility. 

Rising applications of polyolefin elastomers in footwear, adhesives, foams, pipes, molded rubber goods, packaging, and wire and cables are driving the market growth. The packaging industry plays a pivotal role, imparting value to several manufacturing sectors such as agriculture, pharmaceutical, medical, retail, and FMCG. The application of polyolefin elastomers in the packaging industry has expanded over the last few years and ranges across food packaging, wrapping film, and shrink film, along with advanced packaging of various consumer goods, wire and cables, medical fluid bags, and bottles, medical devices, and others. The market has been on an upward trajectory due to high demand from the end-use consumer and industries such as food and pharmaceutical.

Highlights

• Polyethylene (PE) commands the maximum share of the market by type.
• Injection grade influences market growth through manufacturing techniques.
• Adhesives are the most common application in the market.
• Automotive generates the most revenue by end-use industry.
• Asia-Pacific dominates the global market.

Market Dynamics

Market Drivers:

Expanding Packaging Industry

The packaging industry is a significant driver of the global market because of the unique properties of POEs, such as flexibility, scalability, and impact resistance. As consumer preferences and industry requirements change, there is a greater need for innovative and efficient packaging solutions, and polyolefin elastomers are well-suited to meet these requirements. India's packaging industry is diverse, serving various products and industries. Companies have established manufacturing facilities and used these domestic facilities as a base to export to other countries because of the government's positive promotion of the Make in India policy. The government has implemented a plan to lower tax rates for new manufacturing businesses to transform India into a global manufacturing hub. Furthermore, the government plans to level the playing field in the industry by launching several initiatives to support the growth of packaging and technological advancements and the need for domestic businesses to compete with multinational corporations. Similarly, China's packaging industry is a global leader in manufacturing and consuming packaging materials such as paper, plastic, and metal. 

Furthermore, the demand for packaging films with excellent sealability and puncture resistance is a driving factor. Polyolefin elastomers improve film sealing integrity, protecting perishable goods and preventing contamination. Shrink films are widely used in the e-commerce sector for wrapping food packaging products due to their benefits, such as optimal shelf life and higher oxygen transmission rates. With the rapidly growing food industry's demand for shrink film, manufacturers are focusing on expanding their capacity to meet this significant demand. For example, in January 2022, IPG expanded its North American shrink film production by purchasing a new film plant in Everetts, NC, allowing the company to increase production capacity and product types. The expanding packaging industry and the demand for flexible, durable, and sustainable solutions drive the polyolefin elastomers market trend.

Market Restraints:

Fluctuating Price of Raw Material

The prices of critical raw materials, particularly ethylene and propylene, significantly impact the polyolefin elastomers (POE) market. Ethylene and propylene are essential feedstocks in the production of polyolefin elastomers, and price fluctuations can affect overall production costs for POEs, posing challenges for manufacturers and influencing pricing strategies. For example, prices for ethylene and propylene can experience significant volatility during periods of high demand or supply chain disruptions. Changes in global energy prices, feedstock availability, and geopolitical events all impact volatility. Natural disasters or geopolitical tensions, for example, can cause disruptions in the supply of ethylene or propylene, resulting in price spikes. The price of ethylene in North America in 2023 was USD 0.6/KG, USD 1.18/KG in Europe, USD 1.05/KG in Northeast Asia, and USD 1.12/KG in Southeast Asia.

Similarly, the average price of propylene in 2022 will be USD 997 per metric ton, up from USD 983 the previous year. The average price of propylene in 2023 was USD 939 per metric ton. In 2020, spot polymer-grade propylene (PGP) prices fell from 31 cents per pound in early January to 29 cents in late January. They then stayed in the 29-30.25 cent range until early March. Furthermore, global economic factors such as economic recessions or recoveries can influence overall demand for energy and petrochemicals, influencing ethylene and propylene prices.

Market Opportunity:

Increasing Demand in Automotive Applications

The automotive industry presents a significant growth opportunity for polyolefin elastomers due to their unique flexibility, impact resistance, and lightweight characteristics. POEs are finding applications in various components as the automotive industry continues prioritizing fuel efficiency, reduced vehicle weight, and improved interior comfort, contributing to the overall advancement of automotive materials. The Economist Intelligence Unit (EIU) predicts that new vehicle sales will increase by 0.9% in 2023, but overall sales will remain unchanged from 2022 due to a 1.3% drop in commercial vehicle sales. Polyolefin elastomers are widely used in the manufacture of automobile interior trim. Door panels, instrument panels, and dashboard elements are examples of trims. POEs help manufacture lightweight, durable, and aesthetically pleasing internal components, meeting the automotive industry's demand for materials that improve functionality and design.

In the first quarter of the 2023-24 fiscal year, India's automobile industry recorded total sales of 54,98,459 units. In 2023, India's auto market will be the third largest in the world and the fourth largest manufacturer of commercial vehicles. It is expected to rise 7 to 10% in the coming fiscal year. Aside from interior trim, polyolefin elastomers are used to make weather seals and gaskets for automotive applications. POEs' elastomeric properties make them ideal for creating seals that provide water resistance and help improve vehicle performance. Furthermore, in the automotive industry, Original Equipment Manufacturers (OEMs) frequently set specifications for materials used in vehicle components. OEMs' use of polyolefin elastomers in specific applications demonstrates the materials' ability to meet industry standards and requirements.

Regional Analysis

Asia-Pacific Dominates the Global Market

The global polyolefin elastomers market analysis is conducted in North America, Europe, Asia-Pacific, the Middle East and Africa, and Latin America.

Asia-Pacific is the most significant global polyolefin elastomers market shareholder and is estimated to grow at a CAGR of 6.7% over the forecast period. The Asia-Pacific polyolefin elastomers market is expanding due to rising consumer demand for molded plastic goods such as toys and other household items and an expanding packaging sector. In addition, Liaoning Dingjide announced plans in December 2022 to construct a polyolefin elastomers (POE) plant in Yingkou City, China. The project will take five years to complete and cost around €1,350 million.

Another reason for the region's high share is the growing automotive industry. The International Organization of Motor Vehicle Manufacturers (OICA) reports that global vehicle production has increased. China produces the most automobiles in the world. According to the OICA, China will produce 26,082,220 automobiles in 2021. Other markets contributing to the growth of the regional Polyolefin Elastomers Market include Japan, India, South Korea, and Thailand.

North America is anticipated to exhibit a CAGR of 6.5% over the forecast period. According to global market insights, North America accounted for a sizable portion of the global polyolefin market. The rising demand for automobiles, particularly in the United States and Canada, is attributed to market growth. The United States is one of the world's most important automotive markets. According to the United States Department of Commerce, the country will export 1.6 million passenger cars and light vehicles in 2021. This represented a 12% increase over the previous year. The US exported 1.4 million new light vehicles and 108,754 medium and heavy trucks in 2020. The automotive industry contributes 3 to 3.5% of US GDP, which aids market growth. Furthermore, rising per capita income, early adoption of cutting-edge technology, and innovation in manufacturing methods are driving regional polyolefin elastomers market growth.

Europe is expected to be a profitable market for polyolefin elastomers due to their increasing use in the packaging and footwear industries. Germany, the United Kingdom, France, and Italy mainly contribute to the regional market's expansion. Polypropylene's widespread use in the automotive industry will drive market growth in Europe, with the United Kingdom and Germany leading the way. In 2022, EU car production rose in the year's second half, contributing to a 7.1% year-on-year increase. Volkswagen topped the list of leading car brands in Germany in 2023, with a roughly 18% market share. 

In Latin America, Argentina and Brazil are the leading markets due to high product demand in medical and packaging applications. According to the International Organization of Automobile Manufacturers, Mexico is the world's seventh-largest vehicle producer. In October 2023, Mexico's vehicle production increased by 35.8% over the same month in 2022. Mexico's vehicle production increased by nearly 14% yearly in the first half of 2023. The use of Polyolefin Elastomers in automotive bumpers, instrument panels, and trims is also expected to drive the Latin American market's growth.

The Middle East and Africa are expected to account for a minor share of the global  market during the forecast period due to market saturation in end-use applications. Saudi Arabia and South Africa are the leading countries in this market, with rising demand in the automotive and packaging industries.

Segmental Analysis

The global polyolefin elastomers market is segmented based on type, manufacturing technique, end-use industry, and region.

The type is further segmented into Polypropylene (PP) and polyethylene (PE).

Polyethylene (PE) commands the maximum share of the market.

Polyethylene (PE)

Polyethylene (PE) dominated the global market across type segmentation in 2022, with a more than 55% market share. Due to the properties of PE, such as low moisture absorption and impact resistance, it is widely used in automotive applications such as interior and exterior component manufacturing. Furthermore, Polyethylene (PE) is a popular thermoplastic polymer known for its high chemical resistance, low cost, and versatility. It is available in several varieties, including high-density polyethylene (HDPE) and low-density polyethylene (LDPE). HDPE is rigid and robust, making it ideal for applications such as containers and pipes, whereas LDPE is flexible and widely used in packaging films and squeeze bottles. 

Polypropylene (PP)

Polypropylene (PP) is a versatile thermoplastic polymer with excellent strength and chemical and heat resistance. It is widely used in various industries, such as packaging, textiles, and automobiles. Because of its lightweight nature, PP is an excellent choice for applications requiring a balance of durability and flexibility. It is easily molded and resistant to moisture, chemicals, and fatigue. Packaging containers, automotive components, medical devices, and consumer goods are all standard applications.

Based on manufacturing technique, the market is sub-segmented into Injection Grade, Extrusion Grade, and General Grade.

Injection Grade influenced the market growth.

Injection Grade

The injection grade segment was valued at USD 472.3 million and is expected to generate USD 777.9 million in revenue, growing at a CAGR of 5.7%. Injection grade is a polyolefin elastomer manufacturing technique in which the material is optimized for injection molding processes. This grade is designed to meet the needs of applications that require the molding of intricate shapes, such as automotive components, consumer goods, and industrial parts. Polyolefin elastomers intended for injection molding have good flowability, rapid cooling, and easy demolding, ensuring efficient and precise molded part production.

General Grade

The general grade segment held the smallest global market share. Polyolefin elastomers of available grades are versatile and designed to meet various manufacturing techniques and applications. These elastomers are designed to have a balanced set of properties that make them suitable for different processing methods, such as injection molding, extrusion, and more.

Based on application, the market is sub-segmented into Films and adhesives.

Adhesives are the most common application in the market.

Adhesives

The growth of the adhesives segment is attributed to increasing consumption and production of automobiles and rising demand from various other applications such as foams, footwear, consumer goods, and packaging. Distinctive features of the material, such as superior bonds and enhanced adhesion to multiple substrates, further boost the market growth. Incorporating advanced technology in adhesives will generate lucrative opportunities, engendering global market expansion.

Films

In film applications, polyolefin elastomers are tailored to meet the specific requirements of film production processes. These elastomers have excellent clarity, flexibility, and scalability, making them ideal for flexible packaging, shrink, and lamination films.

By end-use industry, the segment can be further bifurcated into Automotive, Packaging, Adhesives, Electronics and electrical, Consumer Goods, and Others (footwear, foams, medical).

Automotive generates the most revenue by end-use industry.

Automotive

the automotive segment is likely to grow at a significant pace. Growth factors of the segment include burgeoning demand for automobiles, specifically from emerging nations of Asia-Pacific, such as India and China. The Indian automotive industry is the world's fourth largest, according to the Indian Brand Equity Foundation (IBEF), and is expected to be worth USD 1 trillion by 2035. From 2023 to 2030, the industry is expected to grow at a compound annual growth rate of 9.7%. The demand for polyolefin elastomers is further generated by technological advancement and the rising adoption of various types of polymers during the manufacturing of vehicles.

Packaging

The second major end-user is the packaging category. Polyolefin elastomers (POE) are commonly used in packaging for both food and non-food items. POE is used to make seals, closures, and wads for caps, liners, and flexible bags, as well as pouches specifically for the packaging of food and beverages; due to the high levels of commoner in POE, which results in soft, flexible and very low-density materials. They also seal cases, cartons, plastic bags, vacuum bags, and other items.

Recent Developments

• November 2023- Mitsui Chemicals discontinued the production of polyethylene terephthalate (PET).
• December 2023- Avient Corporation, a leading provider of sustainable materials, expands its Cesa™ Withstand™ portfolio with new antimicrobial and antifungal additive grades. These new grades improve thermoplastic polyurethane (TPU) film-laminated products and devices in applications where microbe control is crucial.
• December 2023- LyondellBasell announced the sale of its Ethylene Oxide and Derivatives business and manufacturing facility to INEOS.