Vietnam Plastics Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Vietnam Plastics Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The Vietnamese plastics market is valued at 7,948 kilo tons in 2021, and it is projected to register a CAGR of over 10% during the forecast period (2022-2027).

Due to the COVID-19, the Vietnamese market was affected negatively. However, with the resumption of work in major end-user industries, the market is estimated to have reached pre-pandemic levels.

• In the short term, the increasing demand from the construction industry is expected to drive market growth.
• Over-reliance on imports of raw materials and finished plastics is expected to hinder the growth of the market.
• An increase in foreign investments is expected to offer various opportunities for the growth of the market.

• In Vietnam, extrusion molding technology is used to make products, such as PVC, PE pipe, aluminum and plastic pipe, fiber, PVC doors, frames, roofing, and wall coverings. An extrusion molding process involves lower production costs and faster setup time. However, it provides mediocre precision and is mostly suitable for uniform cross-section parts and not complex parts.
• This technology is used mainly in construction activities, and the main products include PVC, HDPE, PPR pipes, profile bars, plastic doors and windows, panels, and furniture.
• There are more than 1,000 extruders in Vietnam that produce construction and technical plastics in the country.
• According to the plastic industry development plan of 2020, the plastics industry will be restructured toward reducing the proportion of packaging and consumer plastics and increasing the percentage of the construction and technical plastics segment.
• Vietnam's construction plastics segment accounts for around one-fourth of the total plastics industry. The development of the construction and real estate sector is boosting the demand for plastic construction products.
• In addition, the government of the country aims to build a million affordable houses in more than 350 industrial zones in the country. These infrastructural development projects, along with the increasing number of factories being installed, are robustly increasing the demand for construction and technical plastics in the country.
• The two of the largest firms in the construction plastics segment are Tien Phong Plastic JSC (NTP), which leads the northern market with having around 60% of the regional market share, and Binh Minh Plastic JSC (BMP), dominating the southern market with occupying rest of the total market share.
• The competition in the construction plastics sector has become increasingly intense. Even though the local plastics enterprises remain dominant due to their huge sizes, shares, and strong brand value, their respective market shares are subjected to fall if they fail to adapt to a more competitive market.
• Based on the aforementioned aspects, extrusion technology is expected to dominate the market.

• Packaging accounts for the largest application segment in the Vietnamese plastics market. The prime reasons for the growing application of engineering plastics in the packaging segment are better wear and chemical resistance, ease of molding, recyclability, puncture resistance, and high mechanical strength.
• Some major applications of engineering plastics in the packaging segment are as follows: packaging of bottled water, flexible packaging, such as sausage skin, and flexible foils, such as shopping bags.
• Polyethylene terephthalate (PET) is one of the plastics majorly used for packaging purposes, mostly in the food and beverage industry.
• PETs are used for making clamshells, bakery and take-out containers, microwaveable food trays, carbonated soft drink bottles, and other packages. Other applications include packaging materials for cooking oils, shampoo, hand wash, and more products.
• Polyamide is another major engineering plastic that finds major application in the packaging sector. Bi-axially oriented and non-oriented polyamide films are used in medical and food packaging, owing to the former's high impact strength and good heat resistance.
• Increasing household and commercial applications for containers, plastic bags, canisters, and tableware, among others, are expected to drive the consumption demand for plastics in the packaging sector during the forecast period.
• The usage of plastics for packaging products is expected to experience fairly steady demand during the forecast period. Requirements for rubber gloves in the healthcare sector, stretch films, garbage bags, and other medical devices are anticipated to witness greater demand in the coming years.
• Thus, based on the aforementioned aspects, the packaging segment is expected to dominate the market.

In terms of production capacity, the Vietnamese plastics market is a consolidated market with a limited number of players engaged in the production of plastic resins. Some major companies in the Vietnamese plastics market (in no particular order) include Far Eastern New Century, Nghi Son Refinery and Petrochemical (NSRP), Hyosung Chemicals, Billion Industrial Holdings Co. Ltd, and TPC Vina Chemical and Plastic Corporation Co.

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