M. Holland’s 2023 Plastics Industry Trends & Predictions

“Process and material innovation have made 3D printing a viable alternative for full production applications, allowing fast prototyping to extend beyond just form and fit evaluations. The expanded capabilities of new additive manufacturing applications will benefit the plastics market in multiple ways. It makes 3D printing a cost-competitive option that manufacturers are incorporating more broadly into their operations across the entire manufacturing process, from ideation and design through production. Many OEMs are now designing facilities around additive manufacturing as the technology gains functionality. 3D printing will only become more integrated into the manufacturing process as time goes on.”

– Carlos Aponte, Market Manager, 3D Printing

“Electrification is the most transformative technology we have seen in the automotive industry in recent years. The push and presence of electric vehicles (EVs) is not just a trend but an enduring part of the automotive fold going forward. New EV manufacturers are entering the market as recent government incentives have increased consumer demand. As EV production continues, so will sustainable material development and innovation. Getting in front of the sustainability wave will be extremely important. However, OEMs are actively looking for more ways to get sustainable materials into both EVs and internal combustion engines (ICEs), which place the focus on durability when it comes to material development and selection.”

– Matt Zessin, Director, Global Automotive

“In 2022, resin, additive and pigment shortages hindered the color and compounding space, but that hasn’t stopped private equity (PE) from making moves. While it’s great that PE investors see value in the industry, the consolidation is making sourcing difficult for smaller operations. Low-margin molders are struggling to find new compounding sources as compounders make a long-term play for bigger business opportunities and cut back on sales and support functions. Luckily actual material shortages are less problematic than they have been in recent months. Inventory has largely caught up to demand as warehouses have filled. In 2023, I expect customers to tighten their belts further to conserve cash due to recessionary fears and work to unload accumulated inventory. Despite recent availability improvements, dual-sourcing resin will remain an important backup plan for producers in the coming year.”

– Scott Arnold, Market Manager, Color & Compounding

“Recent legislation promoting electric vehicles is increasing production and driving a host of new startups in the electrical and electronics market. Likewise, efforts to reshore and deglobalize supply chains have loosened the Asian stronghold on electrical manufacturing. U.S.-based corporations and foreign actors alike are bringing product development and manufacturing to North America. As electrical and electronics products are constantly becoming smarter, faster and more innovative, research and development (R&D) that takes place in the U.S. is also increasing the volume of domestically owned intellectual property (IP) rights. By controlling the IP and engineering through manufacturing, U.S.-based companies will be more competitive globally by increasing their speed to market.”

– Carlos Aponte, Market Manager, Electrical & Electronics

“The healthcare industry continues to adapt to market challenges. We’ve seen many OEMs take inventory positions on plastic resins, so they have safety stocks for their various molders in a ‘never again’ effort to combat raw material shortages that have persisted throughout the pandemic. Nearshoring molds and manufacturing plants, qualifying secondary resins, plus taking inventory positions are a few examples of how the medical industry is attempting to remove supply chain risk going forward. Managing price and volume volatility will be a full-time job in 2023, but it will be the year we can get back to thinking about the future and creating new, next-level medical devices. Remote healthcare devices will see great growth and innovation in the coming year. Consumers have shown they are willing to pay for devices that track specific health markers, and device manufacturers are working to meet that demand.”

– Josh Blackmore, Global Healthcare Manager

“Sustainability continues to dominate the conversation throughout the packaging market. Worldwide brands are committed to sustainable materials in their packaging and are designing for recyclability or a better answer in waste management. Especially as inflation and a recessionary climate are driving companies to find other ways to add value or lower costs in single-use, multi-use and durable goods. Cash flow management is of the utmost importance right now; focus on what you can control, which includes the materials you buy and the goods you purchase. Spending time to hone your business case and service levels, in any stage of the supply chain, is critical.”

– Lindy Holland Resnick, Market Manager, Packaging

“The first three quarters of 2022 showed constrained material supply and high demand in the rotational molding space. However, we project an ebb in demand back to a pre-pandemic level, coupled with additional polyethylene capacity looming, which most molders view as a sense of price relief. That is a boon after economic conditions last year caused rotational molders to reevaluate their business, and many eliminated less profitable and more complex orders. OEMs that were displaced by those changes have opened new manufacturing facilities causing increased pressure on machine and equipment suppliers. Automation efforts have evolved to fill the gaps as new molders develop manufacturing processes without access to the volume of labor that supports more traditional methods.”

– Bill Christian, Product Manager for Rotational Molding

“Sustainability was at the forefront at the largest plastic industry event — K 2022 in Dusseldorf, Germany. Attendees were inspired to take ownership and action to address issues surrounding climate change and a circular economy. This visibility on the world’s stage has proven every company should have a sustainability program, regardless of size, especially as large OEMs and brand owners push their sustainable procurement objectives further down the supply chain. As sustainable initiatives stay at the forefront, collaboration between non-traditional partners will be necessary to reduce greenhouse gases, landfill contributions, incineration and plastic pollution. It is critical for businesses and processors to know the sustainability goals of their customers or OEMs and align with them accordingly. Responsible product design, sustainable material selection and the circular economy should be central to product development.”

– Debbie Prenatt, Market Manager, Sustainability

“As supply chains become more consistent across polymers and conductors in 2023, it will be critical for wire and cable manufacturers to optimize and automate production to allow room for growth. We’re in year three of a massive 10-year infrastructure investment cycle that focuses on two major industry trends — electrification and digitalization. Costs for clean energy like solar and wind power are coming down as they reach scale. This increased affordability, combined with tax incentives, a desire for more reliable energy and global sustainability initiatives, are accelerating adoption and positively influencing demand for power cables. Similar government funding efforts are driving network creators to invest heavily in digital infrastructure in 2023, especially in rural and low-income areas with minimal internet coverage.”

– Todd Waddle, Director, Wire & Cable