CUYAHOGA FALLS, Ohio—Global silicone demand is expected to grow about 5 percent in value terms and 3 percent in volume terms annually through 2021, according to Kent Furst, manager, polymers and materials, at the Freedonia Group.
Furst, in an April 10 address to attendees of the International Silicone Conference in Cuyahoga Falls, said the global market in that time will rise to more than $18 billion. Asia-Pacific will remain the largest and fastest growing silicone market while price growth will accelerate.
His research covered the period from 2006-16, however he added that 2017 was one of the best years for silicones in some time.
"Since the recession, there has been a definite economic recovery, but not as robust as some expected," Furst said. "There have been recessions in parts of Western Europe, South America and Russia. Going forward we expect global GDP to increase 3.5 percent per year through 2021."
North America and Western Europe will see economic growth hovering around 2 percent per year while China and India will continue to be among the fastest growing large economies, but Furst said growth will slow compared to the previous decade.
Overall regional trends for manufacturing are similar to that of GDP. Furst said Europe, Japan, South Korea and Canada had a bright 2017. The fastest growth in manufacturing going forward will come from the Asia-Pacific region.
"There will be a shift going forward as China continues to produce more high-value products with production of lower valued goods moving towards India and Southeast Asia," Furst said. "In North America and Western Europe, manufacturing growth will remain slow. Despite the benefits from shale gas, North America still has high labor costs and modest economic growth relative to Asia."
Core markets for silicone will continue to be electronics, construction, transportation and medical/personal care, with electronics being the healthiest. Furst added that adhesives will be a key growth driver in the construction segment and further applications for liquid silicone rubber will help growth on the medical side.
Extended coverage of Furst's presentation will be included with the April 16 issue of Rubber & Plastics News.