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Plasticizers Market Analysis
Manufacturing of plasticizers results in the generation of harmful waste that tends to have a prominent footprint on the environment for a prolonged period. This brings the plasticizers market under the strict scrutiny of the environmental regulatory bodies. Violations of these regulations by plasticizers suppliers have not only invited costly litigations for them but have also tarnished the buyer's brand image. The steep rise in crude oil prices will have rippling effects on the plasticizers market in the form of increasing raw materials prices. This will act as one of the dominant plasticizers price trends during the forecast period. According to the forecasts, the growing demand from flexible PVC manufacturers and the lightweight automotive market will drive the demand for plasticizers suppliers. This is evident in the projected plasticizers market spend growth that will touch a value of over USD 5 billion at a CAGR of over 5%.
In view of the environmental footprint of plasticizers, it is imperative for buyers to engage with suppliers who are known to adopt sustainability practices. Such practices include a reduction in the consumption of water and energy, limited usage of harmful materials, and minimization of carbon footprints to reduce the impact on the environment and adhere to environmental rules and regulations.
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According to forecasts, plasticizers price will grow at a rapid rate during the forecast period. Lack of insights and understanding of their impacts on the plasticizers price will trigger an uncontrolled procurement spend incurred by buyers in the market. Crude oil price volatility and logistics expenditure will act as some of the chief spend accelerators in the plasticizers market.
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Key Plasticizers Supplier Selection Criteria
It is evident that the supplier's increasing OPEX will have a direct impact on the buyer's procurement spend in the plasticizers market. The efforts taken to optimize this procurement spend should not be limited within the strategic selection of suppliers. Buyers must focus on maintaining a favorable supplier relationship management that will enable buyers to address the potential procurement challenges while fostering a beneficial two-way relationship with plasticizers suppliers.
Engage with suppliers that assist in hedging
In the plasticizers market, buyers are advised to partner with suppliers who can assist in hedging by providing accurate demand and price forecasts. Hedging helps in reducing the risks associated with volatility in the prices of commodities.
Engage with nearshore suppliers
According to the plasticizers price trends, logistics expenditure constitutes about 30% of the total cost of plasticizers procurement, the majority of which is passed on to buyers. It is prudent for buyers to engage with nearshore suppliers to minimize such costs. Buyers should also factor in the volatile nature of plasticizers which necessitates shorter distance and duration of transportation. This helps in avoiding volume loss during transportation.
Criteria to select suppliers in this dynamic plasticizers market is subject to change based on the day-to-day market outlook. Get a free demo of our procurement platform to gain immediate access to real-time insights into the changing plasticizers suppliers selection criteria.
Top Spending Regions in the Plasticizers Market
Factors like the growing frequency of construction activities and the increasing demand for bio-based and non-phthalate plasticizers will propel the spend growth in the plasticizers market across the key geographies.
A recent increase in the frequency of construction activities in the US will propel the demand in the plasticizers market for applications such as flooring and wall coverings, film and sheet coverings, wires and cables, coated fabrics, consumer goods, and others. However, this spend growth will suffer a setback owing to the rising concerns related to the presence of toxic chemicals in plasticizers and their carcinogenic effects are rising concerns associated with the usage of plasticizers.
This region is exhibiting the fastest spend growth in the plasticizers market. Factors such as increasing automotive production and industrialization and the proliferation of manufacturing facilities to APAC will contribute to the spend growth of the plasticizers market in this region during the forecast period.
Insights Offered in this Plasticizers Market Report
SpendEdge presents a detailed picture of the market by way of study, synthesis, and summation of data from multiple sources. The analysts have presented the various facets of the market with a particular focus on identifying the key category influencers. The data thus presented is comprehensive, reliable, and the result of extensive research, both primary and secondary.