Demand across Construction and Packaging Industries to Help GCC Molded Plastics Market Achieve Massive Growth, states TMR
The market for molded plastics across the GCC countries is highly fragmented, with the top ten vendors accounting for a cumulative share of nearly 40% in 2014. Geographic distribution-wise, the market is highly consolidated, with over 60% plastic converters in the market located in Saudi Arabia and nearly 15% in the UAE. The market is thus highly competitive in certain regional packets and is extremely difficult to penetrate. However, as most large vendors have production capacities within the range of only 10 to 50 kilo tons and are confined to specific regional pockets, there’s plenty of scope for growth for new vendors.
Though domestic demand will be a key enabler of growth for molded plastic vendors in GCC countries in the next few years, the market will see an increased trend of expansion through ventures in export markets owing to better bottom-line growth prospects and higher profit margins. In a recent market research report, TMR states that companies in the GCC molded plastic market will put increased focus on product portfolio expansion, investments aimed at technological advancements in production capabilities, and consolidations in foreign lands.
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Rising Consumption of Molded Plastics in Construction and Packaging Sectors to be Key Determinant of Growth
The rising demand for molded plastics across the construction and packaging sectors are considered to be the key enabler of growth of the GCC molded plastics market. Rise in trade activities and increased consumption of industrial and consumer goods in GCC countries have bolstered the packaging industry in the region. This has, in turn, proved to be highly beneficial for the molded plastics market in the region.
Government initiatives towards the development of the construction industry, with an aim of supporting the rising population in GCC countries, have also presented significant growth opportunities for the molded plastics market in the region. However, the market for molded plastics in the region has suffered a massive blow from the recent economic downturn in Europe as Europe is the key exporter of molded plastics produced in GCC countries. Over the next few years as well, the GCC molded plastics market will suffer the negative impact of unpredictable demand in Europe.
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Bahrain to Present Sluggish Growth Opportunities
The GCC molded plastics market is expected to gain the most lucrative returns in countries such as Saudi Arabia, Oman, and Qatar. Saudi Arabia, being the production hub of the GCC molded plastics market, will be the leading market for molded plastics. Oman and Qatar will lead to increased demand for molded plastics on account of the favorable growth of the construction and packaging industries.
However, the market will witness sluggish growth in Bahrain owing to low market penetration and slow economic growth. One of the other important reasons making the Bahrain market grim in terms of growth prospects the fact that most raw materials need to be imported, adding to the cost of the final product and reducing market’s attractiveness.
The GCC molded plastics market will expand at a healthy CAGR of 8.3% over the period between 2015 and 2023, and rise from a valuation of US$7.19 bn in 2014 to US$14.22 bn by 2023. In terms of volume, the GCC molded plastics market stood at 2.82 Mn tons in 2014.
For the purpose of this study, the market has been segmented as follows:
GCC Molded Plastics Market – Product Segment Analysis
- Pipes & conduits
- Bottles & containers
- Cables & wires
- Others (Including medical devices, automotive components, miscellaneous consumer goods, etc.)
GCC Molded Plastics Market – Application Analysis
- Packaging
- Consumable & Electronics
- Automotive & Transportation
- Building & Construction
- Others (Including toys, furniture, etc.)
This review of the market is based on a recent market research report published by Transparency Market Research, titled “Molded Plastics Market - GCC Industry Analysis, Size, Share, Growth, Trends and Forecast 2015 - 2023.”
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