Minerals Exhibit Excellent Growth in the $500 Million Plastics Industry; Principia's Minerals Practice Focused on this Value-added Market
Exton, PA--(BUSINESS WIRE)--May 27, 2003/ - Minerals used as reinforcements, pigment extenders, and fillers
find application in a variety of end-use applications ranging from paper, plastics, paint, rubber, building
products, and many others. Total North American demand for these minerals in 2002 exceeded 15 million tons,
valued at $1.9 billion. Paper applications dominate accounting for roughly half of the tons consumed. However,
plastics which was a minor market only a decade or so ago, has recently become the second leading end use,
consuming an estimated 2 million tons of minerals in 2002 (excluding TiO2), valued at roughly $500 million.
Among all mineral market outlets, the plastics industry is the most intriguing for two important reasons:
- The market consumes the highest value-added minerals with an average price tag of $225 per ton, almost twice the industry average
- Demand for minerals in plastics has the highest forecast growth, at over 5% per year
Polymer compounders have a wide variety of minerals to work with including calcium carbonate, talc, alumina hydrate, silica, mica,
kaolin, diatomite and wollastonite. Since 1980, demand for these additives in plastics has increased on average 7% a year in tons,
compared to an increase of only 4% to 5% per year for the U.S. demand for plastics. In 1980, 9% of all plastic compounds
incorporated minerals. In 2002, the percentage has grown to 15%.
Despite these attractive features, plastics is often a complex market for mineral suppliers because of the diverse number of
polymers compounded (at least 25), as well as the dozens of applications for each polymer. "It is very difficult for the
mineral supplier to focus its R&D and product development strategy for such a fragmented market" according to Carl Eckert,
a Principal at Principia. "Consequently it is the resin suppliers and the polymer compounders that usually drive technological
change. Because of its expertise in plastics, combined with the firm's new mineral practice, Principia is well positioned to
assist producers of minerals or reinforcements to identify emerging opportunities for growth within the plastics market."
Some of the more attractive current or potential applications for minerals/reinforcements in plastics being tracked by Principia include:
- Polypropylene - decks, railings, automotive interior panels/seat backs
- PVC - window/door profiles
- Nylon - high-heat connectors, automotive underhood, flame retardant small appliances
- HDPE - railroad ties, pallets
- Nanocomposites - automotive exterior components, appliances
Each of these applications has a growth potential of over 10% per year, and for some the growth forecast easily exceeds 20% annually.
For any market, Principia understands the changing requirements at the compounder for performance enhancements, higher throughput rates,
and better economics, and the likely impact each of these industry dynamics will have on future mineral/reinforcement demand.
Principia Partners is recognized as a leading international consultancy serving the plastics and minerals industries. The firm serves
clients at all levels of the plastics/minerals value chain, and has recently established a new practice to meet the needs of companies
participating in the minerals and reinforcements industries. A particular focus for the newly formed practice will be to help clients
identify growth opportunities within the plastics industry, already a key market served for Principia. For more information, visit the
company's web site at www.PrincipiaConsulting.com.
Contact:
Principia Partners, 800/378-8330
Carl Eckert, ext. 241
CEckert@PrincipiaConsulting.com
Steve Van Kouteren, ext. 242
SteveVK@PrincipiaConsulting.com
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