Market News Plastics machinery shipments increased in the second quarter
The fear of the plastics industry being hit hard by the pandemic have not entirely become reality. While there is an undeniable Covid-19 impact, the sector is already recovering.
Second quarter shipments of primary plastics machinery (injection moulding and extrusion) in North America increased, according to statistics compiled and reported by the Plastics Industry Association’s (Plastics) Committee on Equipment Statistics (CES).
The preliminary estimate of shipments value from reporting companies totaled 263.4 million dollar, a 4.0 % increase over the first quarter of 2020, when shipments decreased 19.8 % from the previous quarter. However, the percentage decrease in the first quarter of this year was 10.7 % lower than during the same period last year.
The value of shipments of single- and twin-screw extruders fell 35.8 % and 30.1 %, respectively, in the second quarter. Shipments of injection moulding equipment were up 11.4 % from the first quarter, but down 8.5 % from the second quarter of last year.
Recovery in sight
“Although primary plastics machinery shipments are still lower than the previous quarters, the second quarter uptick is consistent with gradual improvement in the U.S. economy,” according to Plastics Chief Economist Perc Pineda, PhD.
The CES also conducts a quarterly survey of plastics machinery suppliers asking about present market conditions and expectations for the future. 40.0 % of respondents expect conditions to either improve or hold steady in the third quarter — higher than the 18.5 % who felt similarly in the first quarter.
As for the next 12 months, 24.0 % of respondents expect market conditions to be steady or better, slightly above the 22.6 % who felt similarly in the previous quarterly survey.
“It was projected that the plastics industry will experience the worst impact of the Coronavirus disruption in the second quarter. However, not all sectors of the economy closed,” said Pineda, explaining that the plastics industry is an essential one. Many businesses have remained open to ensure uninterrupted supply for products in the healthcare sector, for example.
“There are also other segments in U.S. manufacturing — particularly in nondurable essential goods — that use plastic materials or products that continued operations during the lockdowns,” said Pineda.
“Plastics equipment suppliers and converters serving essential consumer end-markets have a reason to be optimistic as economic conditions continue to improve.”
Plastics machinery exports in the second quarter totaled 289 million dollar, a 21.0 % drop from the previous one. Imports rose by 15.0 % to 649.5 million dollar, resulting in a trade deficit of 360.5 million dollar, 9.0 % lower than in the second quarter last year.
Canada and Mexico remain the top export markets for U.S. equipment suppliers. Combined exports to the USMCA trade partners totaled 134.5 million dollar, representing 46.5 % of total U.S. plastics machinery exports in the second quarter.