PLASTICS CUSTOM RESEARCH SERVICES
695 Burton Road
Advance, NC 27006
Phone: (336) 998-8004
Fax: (336) 998-8044
RECENT PATTERNS OF GROWTH AND TECHNOLOGICAL
CHANGE IN THE BOTTLE BLOW MOLDING BUSINESS
On the surface the North American bottle blow molding business has enjoyed buoyant growth over the past few years. The volume of consumption of plastic material has been growing at an average annual rate of 6%, reaching 10.8 billion lbs. by 2004. In the same way the value of output has been growing at an average annual rate of 8.75%, reaching $14.3 billion by 2004. However, a large measure of the growth in value terms is attributable to soaring resin price inflation in 2003 and 2004. The result is what economists would term “immiserizing growth” – that is, nominal growth accompanied by declining profitability as many bottle blow molders have been unable to pass along these relentless raw material cost increases to their customers.
In 2002 PCRS researched and published its original report on the North American bottle blow molding business. Here in 2005 we have revisited this marketplace, conducting over the period April-June a telephone-based survey of over 100 North American companies with bottle blow molding operations, as well as the companies on their material and machinery supply chain. The focus of this new research program has been on identifying and rationalizing the changes taking place in this business – changes in the industry infrastructure, changes in industry concentration as the processors pursue economies of scale in production and greater leverage in material and equipment sourcing, changes in plastic material preferences and bottle designs among their customers, technological changes that enhance the processors’ competitive position vis-a-vis domestic and foreign competitors, and so on.
The growth dynamic in bottle blow molding is quite remarkable insofar as the leading end-use market, soft drinks, has experienced a marked slowdown from the boom conditions of previous decades. Sales of 2-liter soft drink bottles have plateaued, and consumers have become disenchanted with the 3-liter bottles. Yet the 20-ounce soft drink bottle remains popular, and prospects seem bright for the 12-ounce soft drink bottle.
The softening apparent in soft drink packaging stems in large part from the trend to healthy life-styles and diets. This has spurred strong growth in still and carbonated water packaging, making water the third largest blow molded bottle category. Juice consumption is also rising as a result of this new-found health consciousness, and plastic bottles capable of hot-filling are steadily replacing glass and metal containers. Meanwhile the #2 ranked plastic bottle end-use market, household and industrial chemicals (HIC), continues to record steady 5% average annual growth.
This report presents the most up-to-date and comprehensive analysis of the past, current and likely future state of the regional bottle blow molding business. The data and insights in this report represent critical market intelligence for processors and the companies on their material and machinery supply chain.
Publication: July 2005
TABLE OF CONTENTS
INTRODUCTION
EXECUTIVE SUMMARY
The Current State of the Business
The Recent Run-Up in Resin Pricing
Competition from Alternative Materials and Plastics Processing Methods
Competition from Offshore Bottle Blow Molders
Corporate Consolidation and the Trend in Industry Concentration
Past, Current and Likely Future Growth of the Business
PART I: THE SIZE OF THE BOTTLE BLOW MOLDING BUSINESS
The Long-term Trend in the Volume of Consumption of Plastic Material in Bottle Blow Molding,
1989-2009
The Trend of Bottle Pricing, 2001-2004
The Value of Blow Molded Bottle Output, 2001-2009
The Trend of Profitability in the Bottle Blow Molding Business, 2004-2005
PART II: THE EVOLVING INFRASTRUCTURE IN THE BOTTLE BLOW MOLDING BUSINESS
The Number of Companies in Bottle Blow Molding
Corporate Consolidation in the Bottle Blow Molding Business, 2001-2004
Recent Entries into and Exits from the Bottle Blow Molding Business
The Number of Bottle Blow Molding Plants
The Geographical Distribution of Bottle Blow Molding Plants
The Installed Base of Bottle Blow Molding Machines
The Number of Employees in Bottle Blow Molding
Shifts in Capital- and Labor-Intensity in Bottle Blow Molding
Summary of Changes in the Bottle Blow Molding Infrastructure
PART III: THE PROCESSING TECHNOLOGIES IN BOTTLE BLOW MOLDING
The Extrusion Blow Molding Process
The Injection Blow Molding Process
The Stretch Blow Molding Process
The Injection Stretch Blow Molding Process
PART IV: THE MAJOR MARKETS FOR BOTTLE BLOW MOLDERS
The Participation of Processors in the Major Plastic Bottle Markets
Automotive Oil and Other Car Care Products
Beer
Cosmetics
Juice
Milk and Other Dairy Products
Personal Care Products
Pharmaceuticals
Soft Drinks
Sport/Fitness Drinks
Water
The Growth of the Major Plastic Bottle Markets, 2001-2009
PART V: TRENDS IN RESIN SELECTION IN BOTTLE BLOW MOLDING
The Distribution of Resins in Bottle Blow Molding, 2004
The Consumption of Resins in Bottle Blow Molding, 2001-2009
The Extent of Resin-Switching Due to Changing Resin Price Relativities
The Role of Post-Consumer Recyclate (PCR)
The Trend to Clear Bottles
Polyethylene Terephthalate (PET)
PET Supply/Demand Balance
PET Processing and Performance Strengths and Weaknesses
Recycled PET Supply/Demand Balance
Polyethylene (HDPE and LDPE)
Polypropylene
Polyvinyl Chloride (PVC)
Polycarbonate
Styrene-Butadiene
Thermoplastic Elastomers (TPEs)
PART VI: RECENT TECHNOLOGICAL CHANGES IN MATERIALS AND EQUIPMENT FOR
BOTTLE BLOW MOLDING
Perceptions of Technological Change among the Bottle Blow Molders
The Continuing Search for Superior Oxygen and Moisture Barrier
Barrier Technologies for Monolayer Bottles
Polyester Modification
Polyethylene Naphthalate (PEN)
Polytrimethylene Naphthalate (PTN)
Nitrile-based Resins
Nanocomposites
Liquid Crystal Polymers
Barrier Technologies for Multilayer Bottles
Barrier Coatings
Oxygen Scavengers
Active/Passive Systems
UV Stabilizers
Biopolymers – Polylactic Acid (PLA)
PART VII: THE BOTTLE BLOW MOLDERS’ MATERIAL AND MACHINERY SUPPLY CHAIN
Leading Plastic Material Suppliers
Leading Bottle Blow Molding Machinery Manufacturers
Leading PET Preform Molding Machine Manufacturers: Injection Molding and Compression Molding
Leading PET Preform Mold Manufacturers
Leading Suppliers of PET Preform Inspection Systems
Leading Bottle Blow Mold Manufacturers
Caps and Closures: In-House vs. Commercial Sourcing
PART VIII: PROFILES OF SELECTED BOTTLE BLOW MOLDERS
156 Pages 31 Tables 4 Figures
ABOUT THE AUTHOR
Dr. Peter J. Mooney is the founder and president of Plastics Custom Research Services. Dr. Mooney holds a Ph.D. in economics from the University of North Carolina, and he has covered the plastics industry as a technical/economic market research analyst and consultant since 1980. He is a member of several plastics industry associations such as the Society of the Plastics Industry, the Society of Plastics Engineers, and the Association of Rotational Molders. He is also a member of the National Association of Business Economists. He has researched and written over 75 multi-client reports, as well as over 100 single-client reports, in the field of plastics and related industries. He has also organized, chaired, and made presentations to numerous conferences on critical issues facing the domestic and global plastics industry.
ABOUT PLASTICS CUSTOM RESEARCH SERVICES
Plastics Custom Research Services was formed in 1993 in response to the growing demand for accurate and insightful market research tailored to the evolving needs of plastic industry participants. PCRS is able to utilize research methods developed through 25 years of experience in this field - methods that yield cost-effective and timely data and insights of relevance to the product and service offerings of the plastics industry. These research methods include telephone-based and in-person surveys of key decision-making officials in the field, as well as hard-copy and electronic searches of trade literature and patents. Research findings, conclusions and recommendations are provided in written and oral reporting formats. PCRS also provides multi-client Plastics Industry Reports, dealing with subjects that are part of its core competencies and that have relevance to a wide range of plastics industry operatives.