Market Trends of South-East Asia Low-Density Polyethylene (LDPE) Industry
This section covers the major market trends shaping the South-East Asia Low-Density Polyethylene (LDPE) Market according to our research experts:
Rising Demand from Packaging Industry
- LDPE is used to manufacture packaging products such as bottles, tubing, surgical bags, plastic bags, and others, promoting the growth of the South-East Asia low-density polyethylene (LDPE) market.
- These products are preferred in the packaging sector due to their outstanding properties, such as low chemical resistance, low density, excellent flexibility, optimal temperature resistance, and transparency.
- Soft and flexible films are commonly used in the packaging industry for packing and storing a wide range of products and even waste. Low-density polyethylene includes the lowest softening point among the significant packaging plastics, which means less processing energy costs.
- In South-East Asia, the use of LDPE for packaging applications is steadily rising in the e-commerce sector. Furthermore, according to the Vietnam E-commerce Association and the Ministry of Industry and Trade (Vietnam), the revenue of the e-commerce industry in Vietnam was approximately USD 13.7 billion in 2021 (6.5% of total retail sales in Vietnam), representing a 16.1% increase over the previous year.
- Demand for packaged foods is increasing in South-East Asia, boosting the demand for LDPE in packaging. For instance, according to the US Department of Agriculture, the total sales value of packaged food in Thailand was approximately USD 15.65 billion in 2021, a slight increase compared to USD 15.48 billion in the previous year.
- Hence, with such robust growth of the packaging industry across the Soth-East Asia, the demand in the low-density polyethylene (LDPE) market is expected to increase during the forecast period.
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Indonesia to Dominate the Market
- Indonesia is expected to dominate the low-density polyethylene (LDPE) market in South-East Asia during the forecast period, owing to the demand from major end-user industries such as agriculture, automotive, electrical and electronics, packaging, construction, healthcare, and others.
- Low-density polyethylene is an insulator used in the electrical and electronic industries. Furthermore, Indonesia includes a substantial market share in South-East Asia's electrical and electronic industries, contributing to the expanding use of low-density polyethylene within the region.
- LDPE is more frequently used in food packaging as foils, trays, and plastic bags. Furthermore, according to the USDA Foreign Agricultural Service, the retail sales value of packaged foods in Indonesia was approximately USD 33 billion in 2021, a modest rise from USD 32.26 billion in 2020.
- According to the Asian Development Bank, the agricultural value in Indonesia was 1.8% in 2021, half of the growth rate added as compared to 2019. This trend is expected to decline in the studied market.
- In Indonesia, construction establishments have multiplied over the past two decades, driven by expanding population demand, rising income, and increasing need for luxurious developments. Furthermore, according to Statistics Indonesia, total active construction establishments in Indonesia were approximately 203.4 thousand in 2021, a significant increase from 159.31 thousand in 2020.
- All factors above are likely to fuel the growth of Indonesia's low-density polyethylene (LDPE) market over the forecast period.
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