PET – Procurement Best Practices & Sourcing Strategies

DESCRIPTION

Polyethylene Terephthalate (PET) Market Global Size:

ELINT Market Research has released its latest polyethylene terephthalate (PET) procurement market research report, which projects positive facts and figures. Hence, according to the report, the polyethylene terephthalate (PET) market’s global capacity was 58.98 MMT and global demand was 39.00 MMT in the year 2023. Moreover, the PET worldwide demand is anticipated to increase at 3-4% CAGR by 2026.

Market Definition:

Polyethylene terephthalate (PET) material works as the main component in the packaging of different products including food and nonfood. Worldwide businesses and industries employ PET due to its handy qualities like transparency, stability, recyclability, etc. However, this polymer is mainly used for packing carbonated soft drinks, since it can control the carbonation pressure.

Major Polyethylene Terephthalate (PET) Market Drivers:

1. Need for Water Bottle Packaging –

The polyethylene terephthalate (PET) market is experiencing huge growth due to worldwide expansion in water bottle packaging activities. This is a weightless and durable material, which greatly helps in manufacturing water bottles and also resists breakages.

2. Increase in Carbonated Soft Drinks Consumption –

Another major factor that drives growth in the polyethylene terephthalate (PET) market is the increased consumption of carbonated soft drinks, which need this material for packaging. PET has the capability to control the pressure created by carbonation. Thus, it is a perfect choice for containing carbonated beverages.

3. Packaging Requirement for Food & Non-Food Items –

Polyethylene Terephthalate is a versatile material, which assists in the packaging of both food and non-food products since it has handy barrier features against moisture and gases. Also, this chemical provides a long shelf life to conserve product quality.

Polyethylene Terephthalate (PET) Market Challenges:

1. Lack of Demand in Particular Conditions –

The foremost challenge that the polyethylene terephthalate (PET) market faces is a lack of demand due to some specific conditions like economic downtrend, rapidly changing consumer behavior, health-related concerns, and more.

2. Higher Input Costs –

Another key challenge that the polyethylene terephthalate market encounters is shifts in input costs of making PET. The main chemicals like PTA and MEG, which assist in polyethylene terephthalate production are sensitive to price instabilities.

3. Lower Operating Costs –

Polyethylene terephthalate (PET) manufacturing experienced lower operating rates due to factors like excessive manufacturing capacity, fewer needs, and supervision shutdowns. Thus, PET manufacturers underwent decreased competitiveness and market presence.

Polyethylene Terephthalate (PET) Market Opportunities:

1. Recycling Movements for PET –

As environmental concerns are rising, the recycling requirements for polyethylene terephthalate material are also expanding. Thus, companies working in this industry contribute to sustainable PET packaging moves.

2. Increasing PET Demand in Healthcare –

The polyethylene terephthalate market has a great opportunity due to increasing PET demand in the healthcare sector. As PET is a reliable and sustainable material, so medicinal organizations are employing this chemical for the packaging of susceptible pharmaceuticals, chemicals, etc.

3. E-Commerce Products Packaging Needs –

Polyethylene terephthalate works as a key component in the packaging of various e-commerce products like self-care and household goods since this chemical offers efficient and secure packaging.

Polyethylene Terephthalate (PET) Market Segmentation:

1. Different Types of PET –

One of the key segmenting factors for the polyethylene terephthalate market is the different types of this material, including PET polishes and PET sheets. Both of these types help in the packing of multiple food and non-food products.

2. Type of End-User Industries –

Several end industries are employing polyethylene terephthalate chemicals for product packaging needs, which include food, fabrics, beverages, clothing, medicine, automobiles, etc.

Major Supply Markets in the Polyethylene Terephthalate (PET) Market –

In the global polyethylene terephthalate market, multiple regions are contributing to the overall PET distributions. In this list, Asia is leading with a 71.0% share, which implies this nation has key PET manufacturing hubs and also hugely supplying it worldwide.

Further, North America holds a 7.0% stake and the European Union has a 12.0% stake, which represents a somewhat smaller contribution to the global PET supply. Moreover, the remaining supply requirements are fulfilled by some other countries which comprise an 11.0% rate.

Impactful Cost Components in the Polyethylene Terephthalate (PET) Market –

The prime and impactful cost component in the global polyethylene terephthalate market is raw materials. Further, in multiple countries, the raw material prices contribute significantly to the general expenditure. In this context, North America has 86.3%, the EU has 85.7%, and Asia has 86.0% raw material costs, which influences the overall cost structure.

Price Outlook in the Polyethylene Terephthalate (PET) Market –

Multiple regions experienced different price dynamics in the global PET market in the fourth quarter of 2023, in comparison to the first quarter of the same year. In this context, North America had 16-18%, Europe had 11-13%, and Asia had 5-7% expansions in the expense of polyethylene terephthalate chemicals. Further, various market dynamics and economic factors can influence these prices.

Types of Engagement Practices in the Polyethylene Terephthalate (PET) Market –

In the global polyethylene terephthalate (PET) market, the European and the United States nations employed prominent engagement practices in which customers and suppliers foster long-term agreements and establish obligations. This method provides resilience and predictability to both partakers. Moreover, the spot transactions strategy has emerged mainly in Asian regions, which allows buyers and sellers to execute immediate and on-the-spot sales of PET products.

Supplier and Buyer Powers in the Polyethylene Terephthalate (PET) Market –

Multiple regions operating in the global polyethylene terephthalate (PET) market exhibit diverse supplier and buyer powers. In this sense, North America holds high supplier power, which implies PET manufacturers and suppliers have a robust existence in this nation. On the other hand, this country has low buyer power, which means purchasers are less influential in shaping market conditions.

Another key region is the European Union (EU), whose supplier power is calculated as a medium, representing balanced conditions between PET producers and buyers. Further, this country’s buyer power is also identified as a medium. Additionally, the last nation in this list is Asia, which has low supplier power, implying fewer PET manufacturers and the buyer power is estimated as high. Thus, purchasers hold a robust presence in this nation’s PET market dynamics.

Contract Period in the Polyethylene Terephthalate (PET) Market –

Polyethylene terephthalate manufacturers and their consumers employ medium-length contract, which lasts for 3 to 5 years. Thus, this long-term partnership provides resilience and consistency to both parties; also they can navigate market instabilities and adapt to varying demands.

Leading Suppliers in the Polyethylene Terephthalate (PET) Market:

Several leading suppliers are playing a pivotal role in shaping the polyethylene terephthalate industry which includes DAK America​, IVL​, Nan Ya Plastics​, JBF​, Lotte Chemical UK​, Neo Group​, Hengli Petrochemical​, China Resource Packaging​, Yisheng Petrochemical​, Jiangsu Sanfangxiang industrial group​.