Optimism for BOPET film in the face of oversupply and destocking to 2027: AMI Consulting
The BOPET-film market continues its positive growth with global demand growing by almost 2 million tonnes over the last five years, according to a new report from industry consultant AMI Consulting. Both existing and new players are investing in production capacity to capitalize on this growth with BOPET-film demand reaching over 7 million tonnes in 2022 (above).
Of the new capacity coming on-stream since 2017, nearly 70% is accounted for by China which has been the driving force behind the growth in both global capacity and production. China’s expansion has been wide-ranging comprising both packaging lines and investments contributing to the country’s focus on high tech and new energy manufacturing. Other world regions have also invested, such as the Indian Sub-Continent and Southeast Asia, but to date much of this has focused on packaging growth specifically.
Over the past five years, BOPET demand, production and capacity have been aligned. The market now tells a different story. Global production currently exceeds demand and the growth in BOPET capacity is significantly higher, threatening the short-term stability of the market. BOPET-film producers are affected by declining prices for their films and falling utilization rates because of the surge in capacity continuing to come on-stream coupled with reduced demand, as customers focus on reducing stock levels built up over recent years. The difficult situation will be further prolonged with several film producers delaying commissioning of their new BOPET lines in recognition of current global market conditions.
In spite of the current global overcapacity, producers of BOPET film remain positive about the film’s future. The film’s strong properties provide a range of growth opportunities particularly in regions where packaged food and modern retail penetration is low, and in developed regions, where demand is growing strongly in applications such as lidding and labels, with BOPET contributing to mono-material solutions. In the industrial sector, producers are poised to take advantage of a new growth cycle in end uses such as high value electronics manufacturing and new energy boosted by favorable government policies. Electrical applications are also expected to show ongoing healthy growth, thanks to new battery applications, and the growth in flexible electronics and energy related segments.
Each world region’s BOPET market forecast is markedly different and depends on a range of different variables which are examined in the report. Globally, in the longer term, the market remains attractive both for existing players who continue to invest in broadening their product ranges for new applications, and for new BOPET producers who aim to benefit from the growth of both packaging films and industrial BOPET markets. Both markets are anticipated to exceed global GDP growth to 2027, with converters and end-users optimistic about continued growth in demand for BOPET across both packaging and industrial markets in the future.