Latin American plastic industry is seeking opportunities

By 2021, Latin America’s plastic production accounted for about 4% of the global total. In 2022, local chemical enterprises were also challenged by the global market situation and the local political and economic situation. In 2022, the business environment in Latin America will be affected by external factors such as high inflation, political situation and large fluctuations in raw material prices, which will continue to affect the Latin American plastic industry in 2023. However, on the issue of environmental protection, Latin American enterprises continue to comply with the requirements of consumers and legislation. Latin American governments have also implemented a number of incentive policies to help improve the recovery rate, recycling, recycling quality and the use of sustainable raw materials, with a view to finding new opportunities in the environmental protection plastic industry.

Brazil is the largest plastic producer in Latin America. Brazil’s domestic manufacturing demand is strong, and it will remain the main plastic producer in the region. However, in 2022, the political situation in Brazil will be unstable, the supply chain will be affected by the Russia-Ukraine conflict, and the development of industry structure will become a bottleneck. Market insiders predict that Brazil’s economy will slow down in the next few years, which is also a difficult problem for the new Brazilian government to solve.

The development of Brazil’s plastics industry has also been affected by these factors.

At present, the Brazilian plastic industry is actively responding to the market’s requirements for environmental protection and sustainable development. Take Brasco, a leading enterprise in the local resin manufacturing industry, as an example. The company is increasing the production of renewable sugarcane based polyethylene by 30%. On the other hand, some resin manufacturers also actively develop post-consumer recycled resin (PCR) business through cooperation with recycling companies or acquisition of recycling manufacturers and other projects. According to the statistics of the Brazilian Plastics Industry Association, about 30% of the 880000 tons of post-consumer recycled resin produced in the country in 2021 will be recycled and produced by comprehensive recyclers, while the remaining 70% will be recycled and rebuilt by other steps. Looking forward to 2023, driven by current development trends and opportunities, the market expects that the growth rate of plastic recycling business in Brazil will lead the overall plastic industry.

Mexico is the second largest plastic producer in Latin America, and the largest exporter and importer of plastic products in Latin America. This is mainly due to the trade flow of trade partners under the USMCA. In 2022, despite high inflation, slow domestic economic recovery and the recent decline in global economic activity, Mexico’s plastic industry benefited from the backflow initiative and USMCA partner orders, with an average annual growth of 3.7% in the past five years.

In terms of environmental protection, the plastic recovery rate in Mexico is about 14.5%. For companies that focus on reducing carbon footprint and sustainable development, the development of biopolymers has become the focus.

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