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Octubre de 2021

The future of plastics after Covid 19

The fall in foreign trade, retail consumption and automobile production hit the plastics industry. But a rebound in consumption will boost the sector again.

During the latest version of "Seminarios en Español NPE 2021", a virtual event organized by Tecnología del Plástico, Perc Pineda, Ph.D., and chief economist of the Plastics Industry Association offered a vision of the future of plastics after the pandemic.

From his perspective, the post-pandemic future of plastics will have challenges and opportunities. There will be opportunities for plastics product development related to Covid-19 recovery, and this will create an additional share for the plastics industry. And there will be challenges related to climate change, an issue that is high on the Biden agenda. "Eventually we will see more regulations on this issue, which other countries may follow. So it is important for the plastics industry to address the issue of sustainability," the expert said.

Also read: We put ourselves in a situation where we must take recycling seriously: George Gatlin, Invema 

The impact of Covid 19 on trade

The Plastics Association launches an annual report on global trends in plastics. In this report, the countries with the highest volume of trade in plastics products are listed. At the top of the list are China (with a trading volume of USD 169 billion), the United States (USD 133 billion), and Germany (USD 117 billion). Mexico ranked tenth in this ranking, with USD 38 billion.

The global plastics trade fell last year due to the pandemic. World plastics exports fell by 3.1%. In Latin America, exports fell by 8.5%, with the biggest drop of 49.6% in Argentina. In the Dominican Republic, exports fell by 18.2%. In Brazil and Chile, exports fell by 14.9% and 14.2%, respectively. In addition, world imports of plastics fell by 5.2% last year. In Latin America and the Caribbean, they fell by 11%, with the largest drop in the Dominican Republic, followed by Ecuador, Costa Rica, and Mexico.

According to data from international monetary funds, global conditions deteriorated during the pandemic. World GDP fell by 3.6%. In Latin America and the Caribbean, GDP fell by 11.5%. "However, this year and next year the world economy will recover. Strong economic growth is expected in Latin America and the Caribbean, and in the region, the volume of exports and imports will also increase," according to Pineda.

The expert says that healthcare and retail spending will increase after the pandemic, which will drive demand for plastics. With the crisis, countries will rethink their healthcare spending and set a minimum stock level for medical equipment and supplies as they learn from the pandemic. This will generate demand for the healthcare market.

Meanwhile, retail trade-in Mexico fell 22% in April 2020 due to Covid 19. "But as the economy recovers and this year's GDP projections for Latin America are solid, consumer spending will increase," says Pineda. "With more than 40% of plastics used in different types of packaging, increased retail sales should lead to more demand for plastics."

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The automotive market

In the automotive industry, four interconnected transportation trends will continue to generate demand for plastics: electric, autonomous, connected and shared vehicles. The global market share of electric vehicles will increase from 6% to 8% this year, following a 4.4% share in 2020. The European market will drive this growth, according to industry observers.

Motor vehicle production in Latin America declined last year due to the pandemic. Automobile sales declined but are expected to increase in 2021. In China, they will increase by 7%. In Europe 10% and 14% in the United States. For the rest of the world, including Latin America, car sales will increase by 7%.

Therefore, we can expect an increase in plastic production for the automotive market this year as countries recover from the pandemic.

Plastic as part of the solution

One of the questions we keep asking ourselves is: What is the material of the future? What packaging material will be appropriate? Regardless of the materials, do we have the technology to manage the solid waste of the future? "Humans are explorers and innovators, which is why we have the products we enjoy today," says Pineda.

In his view, environmental problems should be solved at the lowest possible cost to society and should include access to the goods and services society needs. Plastics are part of several of the solutions that have been proposed to counteract the problems of climate change: the manufacture of wind turbines, for example, or the manufacture of drones to sow seeds and reforest forest areas is made possible thanks to the participation of plastic. "Onshore wind capacity additions are expected to grow fastest in Latin America this year in Argentina, Brazil, Chile, Colombia, and Mexico."

Palabras relacionadas:
Latin America, plastics, pandemic, plastics products, last year, plastics industry, automotive market, climate change, Dominican Republic, Colombia, Ecuador, Venezuela, United States, Costa Rica, Peru, Brazil, Mexico, Chile, Argentina

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