France Elections and Its Impact on European Masterbatch Industry
May, 2017 : The
ongoing Presidential elections in France, which are primarily revolving around
Frexit (the potential exit of France from the EU), are slated to have an
enormous impact on the economic and business environment in the EU as well as
the Euro.
Notably, France is the largest country in the EU,
contributing almost 15% of the overall EU GDP in 2015.
In
particular, the masterbatch industry of Europe would likely bear the consequences
of changes in France’s relationship with (and role within) the EU. In 2016, the
country produced around 4.66 million metric tons of plastic materials and
ranked among the top 5 plastic producing nations in the overall European
plastic materials production.
Presence
of production facilities controlled by global masterbatch manufacturing
players, such as A. Schulman and Polyone Corporation in major cities of France
including, Givet, Cergy and Tossiat has been pivotal for the growth of
masterbatch market in EU. Implementation of Frexit may result in introduction
of incumbent trade barriers for masterbatch manufacturers in France, thereby hampering
the smooth and flexible trade-relationships with Eastern European countries, and
consequently impacting the overall European masterbatch industry.
Over
the last five years, France controlled a sizeable share in the overall Europe
masterbatch market, controlling a market share to the tune of 11-12 percent
during this period. Establishment of new trade barriers within Europe is
forecast to hinder the growth of masterbatch industry in Europe over the next
five years. However, if the new ruling party in France agrees to remain a part
of EU, France would consolidate its position as a leading market for
masterbatch in the European market.
According
to the recently published report by TechSci Research, “Europe
Masterbatch Market
By Type, By End User, By Country, Competition Forecast and Opportunities, 2011
- 2021”, the masterbatch market in Europe is projected to cross US$6.3 billion
by 2021. Increasing per capita plastic consumption, growing packaging industry
and rising demand from plastic and polymer manufacturers are the major factors
anticipated to boost demand for masterbatch in Europe. In 2016, white
masterbatch accounted for the largest share in the region’s masterbatch market
owing to their ability to provide opacity to the base polymer. This trend is
expected to continue over the next five years as well. Packaging industry is
expected to remain the largest demand generator for masterbatch market in
Europe, followed by construction and automotive sectors.