US Flexible Plastic Packaging Sales

US flexible plastic packaging sales in the 2011 to 2013 time frame was in the $18 billion to $20 billion range, based on a review of data on the Internet.   Historically, packaging sales growth from year to year follows retail sales growth.  However, it is likely that flexible plastic packaging sales growth will exceed the historical rates.  Some of the reasons for this are:

1.  Customer Acceptance.  Flexible plastic packaging allows for advances by packagers in design, open-ability, reseal-ability, size, package messaging, and other features which have great appeal to customers.

2.  Better Performing Plastics.  Technical developments are allowing packagers to use better performing plastics in flexible plastic packaging that provide greater shelf-life, lower weight, and other desirable properties.

3.  Active Packaging.  Technical developments are now allowing packages to be “active” in that packaging materials can do such things as absorb oxygen, water, and other undesirable chemicals and be antimicrobial.

4.  Intelligence Packaging.  As in 2 and 3 above, technical developments are allowing packagers to insert sensors, communication signals, safety-related devices, and other desirable “intelligence” systems into the packaging.

Because of the above reasons, flexible plastic packages should provide many increased benefits to the seller and the buyer of products in flexible plastic packaging.  These increased benefits should lead to better sales growth than for other packaging.

Some Cost Data Related to US Chemical Shipments

The Internet was searched for truck, rail, and barge costs data related to chemical shipments in the United States.

Data was found that suggests that approximately $46 billion was spent by chemical companies in the US to ship their products in 2013.  This represents a shipping cost to revenue ratio of about 6% (total chemical sales in 2013 believed to be about $812 billion).  Reducing this ratio by 1% could save approximately $5 billion.

Data found suggests that the cost per ton mile for shipping by truck in 2013 was in the $0.30 to $0.35 range.  And, shipping by rail was in the $0.06 to $0.07 range.  Assuming this data is approximately correct, truck shipments were about 5 times more expensive than rail shipments in 2013.

Although truck shipments were more expensive, 2013 data suggests that about 68% of all chemical shipments were by truck, 22% by rail, and most of the rest by barge.  Truck shipping allows for greater flexibility, smaller shipments, and more on-time deliveries.

Some Estimates for Recycled PET Sales

Based on data found on the Internet, in 2013 approximately 9 million MT (metric tons) of PET (polyethylene terephthalate) polyester was produced globally.   (Most PET produced was used to make bottles.)

Also Internet data suggests that approximately 30% of produced PET bottles are recycled into producing “recycled” PET.  And, that recent market prices paid for the used PET bottles were $400 to $550 per MT for mixed-colored PET bottles and $630 to $800 for colorless PET bottles.

Recent sales prices for recycled PET from these recycled PET bottles ranged from $900 to $1,040 per MT for PET produced from mixed-colored bottles and from $1,200 to $1,350 per MT for the recycled PET produced from colorless bottles.

So, assuming that 2.7 million MT (0.30 % X 9 million MT) of colorless PET bottles were recycled (assuming only colorless bottles were recycled), recent recycled PET had an approximate average $3.5 billion market sales value (2.7 million MT X ($1,200/MT + $1,350/MT)/2)) (if all recycled PET was from colorless bottles, which was not the case).

If all the bottles were of mixed color, this average market sales value would be approximately $2.6 billion (2.7 million MT X ($900/MT + $1,040/MT)/2)).

Since the used recycled PET bottles were neither all colorless nor all colored, and the distribution of each category cannot be determined, I conclude that the recent market sales value of recycled PET from used PET bottles is in the $2.6 to $3.5 billion range.

Because the average prices paid for the used PET bottles that were recycled into PET are approximately known, the average costs of these used bottles can be estimated.  And, using this estimation, an average gross profit margin percentage range for recycled PET can be calculated.

Please email me, if you are interested in more details on the above.

Some Conclusions from Polyamides Sales Data

Uses for polyamides include: in textiles; in carpets; as engineering plastics; as ropes; in food packaging films; in sporting equipment; in 3-D printing; as electrical insulation; and as cable covering.

In the 2012-2013 time frame, according to marketing sales reports, global polyamide sales for all uses came to about $22 billion.  And, about 45% of these sales were in the European Union; 25% in NAFTA countries; 25% in Asian countries, with 5% in the rest of the world. 

With an estimated 500 million people and 45% of the $22 billion polyamide global sales, the European Union had about $20 of polyamide sales per person in 2013 (0.45 X $22 billion polyamide sales/500 million people).  In NAFTA, the per person polyamide sales was about 40% less at about $12 per person (0.25 X $22 billon polyamide sales/444 million people).  Assuming Asia’s population at 4.4 billion, the per person polyamide sales is at about $1 per person (0.25 X $22 billion polyamide sales/4.4 billion people).  And, per person sales for the rest of the world would be about the same as for Asia (0.05 X 22 billion polyamide sales/1.6 billion people).

This regional per person polyamides sales data suggests an enormous potential for polyamide sales in Asia and in emerging economies as their economies mature.  For example, in Asia, assuming a 4.4 billion population, if the per person polyamide sales in 2013 was $5 instead of $1 per person, annual sales would have increased by about $18 billion ($5 per person X 4.4 billion people less $1 per person X 4.4 billion people).

My guess is that for many of the uses of polyamides, substitution products are not likely to take away substantial sales of the polyamide products.  So, if European Union per person polyamide sales represent a potential per person Asian sales in polyamides, it is not surprising that chemical companies continue to maintain and invest in their polyamide production and technology.

Chemical and Material Shortage Alert – December 2014

The purpose of this blog is to identify chemical and material shortages reported on the Internet.  The sources of the information reported here are primarily news releases issued on the Internet.  The issue period of the news releases is December 2014.

Section I below lists those chemicals and materials that were on the previous Chemical and Material Shortage Alert list and continue to have news releases indicating they are in short supply. Click here to read the November 2014 Chemical and Material Shortage Alert list.

Section II lists the new chemicals and materials (not on the November alert).  Also provided is some explanation for the shortage and geographical information.  This blog attempts to list only actual shortage situations – those shortages that are being experienced during the period covered by the news releases.   Chemicals and materials identified in news releases as only being in danger of being in short supply status are not listed.

Section I.   Chemicals and materials that continue from November to be reported as in short supply are: none

Section II.   Shortages Reported in December not found on the Previous Month’s List

Iron ore:  India; government regulations

Nickel:  global; government regulations

Polyetherimide (PEI) resin:  global; production not keeping up with demand

Propylene: global; production not keeping up with demand

Urea:  India; government regulations

Reasons for Section II shortages can be broadly categorized as: 

1.  Mining not keeping up with demand: none

2.  Production not keeping up with demand: polyetherimide (PEI) resin; propylene

3.  Government regulations: urea; iron ore; nickel

4.  Sources no longer available:  none

5.  Insufficient imports:  none

6.  Supply not keeping up with demand:  none

The CPID Database – Identifies Hundreds of Personal Care and Other Retail Products and the Chemicals They Contain

A database called Consumer Product Information Database (CPID) contains brand names, manufacturers, and other details on hundreds of thousands of personal care, home maintenance, and other types of retail products.  Click here to access this database.  This database, maintained by DeLima Associates, seems to be an excellent source of information for companies on their United States competitors’ products.  A primary purpose of the database is to identify chemicals contained in products and also known health affects of the chemicals contained in the products.

For a listing of personal care products, at the home page, click product type along the top bar menu.  Then select personal care in the left drop down menu.  In the next drop down menu to the right, select one of the personal care categories, such as personal cleanliness.  This will provide is list of products that US manufacturers market as providing personal cleanliness.  On the list that is generated, click on the product name of interest to find details on that product.  Details include: manufacturer and the product’s chemical ingredients.

Personal care is one of 10 product types.  Other product types include: automotive; commercial/institutional; hobby/craft; home inside; home maintenance; home office; landscaping/yard; pesticides; and pet care.   Each product type is further divided into categories. As mentioned above, for the personal care product type, one category is personal cleanliness.  Some other personal care categories are:  bath/shower; oral hygiene; and shaving cream.  

The database can be searched by a specific product name to find detailed information (e.g. manufacturer and chemical ingredients) for that product.

This consumer product database strikes me as immense and useful in terms of the details provided on thousands of retail products containing chemicals.   The database should be useful in providing a company details on the products marketed by the company’s competitors.

Increasing Use of UV LEDs

In recent years, as the technology of ultraviolet (UV) light emitting diodes (LEDs) has improved, the use of UV LEDs has significantly increased.  An extensive search of the Internet has found references to UV LEDs used in the following applications:

Back light

Chemical synthesis

Cosmetics sterilization

Counterfeit money detection

Curing of coatings, inks, and adhesives

Disinfection and purification

Forensic applications

Instrumental chemical analysis

Medical therapies

Optical sensing

Plant growth

However, also found are stated problems that are hindering even further UV LED uses.    Problems stated include:

Costs

Insufficient photo-initiators in the right UV ranges

Lack of diodes generating needed wavelengths

Lack of heat

Optics

Oxygen inhibition

Slow curing rates compared to mercury lamps

Lack of standardization guidelines

Suitable substrates

Thermal management

The 2013 market for UV LED products is estimated to be in the range of $40 to $50 million. This estimate is provided by producers of market research reports, which can be purchased.  The same reports estimate the sales compound annual growth rates (CAGR) of these products to be in the 30 to 43% range over the period 2013 to 2018.   So, if in 2013 sales is $45 million and the CAGR is 36.5%, in 2018, UV LED products will have sales of about $213 million.

On the basis of the above referenced Internet searching, it seems to me that two critical technologies where development work is still going on and where successes are crucial to increasing use of UV LEDs are:

1.  Enhancing the chemistries that are triggered by the UV, e.g. better photo-initiators; and

2.  More efficient and effective light emitting diodes (LEDs).

Some chemical companies doing photo-initiator, and related research, are: Bayer Material Science; DSM; Arkema; BASF; Cytec; Mitsui; and Evonik.

And some companies doing R&D to enhance UV LEDs are: Nitride Semiconductor; Semileds; Nichia; Seoul Semiconductor; and Sensor Electronic Technology

Although the current market percentage for UV LED products is relatively small compared to products using non-LED generated UV, this parentage is likely to significantly increase in future years due to the many advantages that generating UV radiation using LEDs offer.  Some advantages identified during Internet searching include:

Concentrated radiation

Longer life times compared to mercury lamps

Faster warm-up and cool-down times

Narrower power distribution

Lower heat generation compared to mercury lamps

Lower energy use compared to mercury lamps

Improved environmental affects, e.g. no mercury vapor, ozone,
and organic vapors

Consistent, predictable radiation output over time

Smaller wavelength generation range

More control over UV radiation generation compared to mercury lamps

Smaller, more compact associated equipment leading to more efficient processing
Lower maintenance compared to mercury lamps