Polyamide 12 Market

Introduction

The global polyamide 12 market is expected to register a remarkable CAGR of 5.23% during the forecast period, 2019–2024. The increasing demand for polyamide 12 in the automotive industry is expected to be the prime factor driving the growth of the product market. Also, the growing demand for polyamide 12 in the consumer goods industry is also expected to fuel the global market growth. Furthermore, the shift toward the use of bio-based products is expected to create lucrative growth opportunities for the players operating in the global polyamide 12 market during the forecast period. However, the availability of substitutes at low cost is projected to be the major restraining factor to the growth of the product market.

The trend observed in the global automotive industry is the manufacturing of lightweight automobiles due to increasing regulations pertaining to carbon emissions. According to experts, 10% reduction in the overall weight of an automobile results in 6–8% of reduction in fuel consumption. Less fuel consumption increases the fuel efficiency and thus helps to reduce the carbon emission, which is the ultimate need of an hour. To reduce the overall weight of the automobile, metal parts are increasingly replaced by plastics components. The US Environmental Protection Agency (EPA) and the National Highway Traffic Safety Administration (NHTSA) developed the national program for Green House Gas Emission and Fuel Economy Standards to influence automobile manufacturers to reduce the weight of the vehicles and reduce CO2 emissions. The CO2 emission target for new passenger cars is defined as 95g CO2/km for the year 2020 as compared to 118.5 g CO2/km emission target in the year 2017.

Polyamide 12 is one of the most widely used polymers in the automotive industry owing to its superior properties such as lightweight, abrasion resistance, chemical resistance, high elongation, excellent impact strength even at extremely low temperatures, resistance to cracking under stress, and noise & vibration dampening property, among others. It is majorly used in the manufacturing of multilayer pipes such as fuel lines, pneumatic brake lines, and hydraulic lines by the manufacturers of automobiles worldwide. In response to the growing awareness regarding environment safety, automobile manufacturers are making multilayer fuel pipe systems that avoid halogen-containing polymers in favor of nylon-clay hybrid (NCH) materials, which act as a barrier in vapor emission. Besides, polyamide 12 is also used in the manufacturing of the electricals & electronics systems, interior trim, gears & bearings, and other structural internal and external parts of automobiles. The use of polyamide 12 in the automotive industry is expected to significantly increase during the forecast period. The expanding automotive industry due to the increase in the sale and production of hybrid & electric vehicles is expected to boost the demand for polyamide 12 in the coming years. Most of the demand is likely in the fast-growing Chinese automotive industry.

Bio-based polyamide 12 is a long-chain linear polyamide belonging to the aliphatic polyamides group. Fatty acids from renewable resources are used to synthesize bio-based polyamides, and bio-based polyamide 12 represents the high-performance member of the bio-based polyamides family. The performance characteristics of bio-based polyamides 12 is similar to its synthetic counterparts.

The prevailing trend observed in the global chemical industry is the shift of consumer preference from synthetic chemicals to bio-based products. This shift is led by the growing government regulations regarding synthetic chemicals on account of toxicity and environment safety. This has also been witnessed on an industry level, e.g., the players operating in the automotive industry are opting for bio-based polyamides in a broad range of applications. Arkema (France), Evonik AG (Germany), MS Chemie (Switzerland), and Ube Industries Ltd (Japan) are some of the companies engaged in the production of bio-based polyamide 12. It has been observed that global warming potential of fossil-fuel based polyamide 12 is 7 kg CO2 equivalent/kg of polymer, whereas global warming potential of bio-based polyamide 12 is 4 kg CO2 equivalent/kg of the polymer.

This trend is likely to continue during the forecast period and create lucrative opportunities for the players operating in the global market.

Polyamide 12 can be transformed into any desirable shape and size and hence due to the flexibility, it is expensive as compared to the other available nylon grades.

Polyamides comprise the largest family of engineering plastics with a very wide range of applications because of their good balance of properties. Polyamides are resistant to wear and abrasion, have excellent mechanical properties even at elevated temperatures, low permeability to gases, and excellent chemical resistance, dimensional stability, toughness, high strength, high impact resistance, and good flow. Some of the nylon grades present in the market other than nylon 12 (PA 12) are nylon 6 (PA 6), nylon 6,6 (PA 6,6), nylon 6,10 (PA 6,10), nylon 11 (PA 11), nylon 6,12 (PA 6,12), nylon 6, 9 (PA 6,9), and nylon 4,6 (PA 4,6).

PA 6 has a high melting temperature and excellent abrasion resistance property, which allows its use in the manufacturing of various machine parts. PA 6,6 is slightly crystalline and has high abrasion resistance. PA 6,10 has an excellent chemical resistant property and absorbs less amount of moisture. It is also stronger than any other nylon as it does not break down even in the presence of salts such as zinc chloride. PA 11 is extracted from vegetable oil and is resistant to UV. PA 6, 9 absorbs very less amount of moisture, however, melts at a much lower temperature. PA 4, 6 is highly resistant to chemical and also to crystallizing. Most of the nylons may lose their properties in high temperature, but this is not the case with this grade of nylon.

Thus, the low cost of other nylon grade and their relatively similar performance characteristics are expected to hinder the growth of the global polyamide 12 market during the forecast period.

Polyamide 12 is produced from laurolactam, which is derived from crude oil. However, crude oil prices are constantly fluctuating for the last five years. According to Crude Oil Investing, there have been large swings in crude oil prices from USD 140 per barrel in 2008 to as low as USD 34.74 per barrel in 2016.

In the figure, the crude oil prices since 2014 can be observed. Crude oil prices were always more than USD 100 per barrel prior to 2015. In 2015, the price declined by 51% and reached USD 52.09 per barrel. The price did not cross USD 100 per barrel since 2015.

With the oversupply of crude oil, there was a sudden drop in the price due to less demand. The fall in demand was observed mainly from the US, China, and other European countries. The other factor that led to a fall in crude oil prices was the pricing from the Organization of Petroleum Exporting Countries (OPEC). The oil price is decided based on different factors such as the economic growth of countries, weather conditions, demand and supply analytics, and the presence of alternative energy resources.

Thus, fluctuating crude oil prices is expected to affect the production of laurolactam and consequently polyamide 12, which is expected to be a major challenge for the market players.