Bottlenecks in the supply chain are holding back the shipping of plastic equipment

Supply chain-related bottlenecks are holding back deliveries of machines for primary plastics processing, which declined for the second quarter in a row, the Plastics Industry Association (PLASTICS) announced today.

The estimated value of injection molding and extrusion equipment shipments from reporting companies in the second quarter of this year was $ 320.9 million, according to statistics from PLASTICS ‘Committee on Equipment Statistics (CES). That’s a 4.2% decrease from the first quarter, which started the year down 11.1%. Compared to the second quarter of 2020, however, sales of plastic machines rose by 21.2%. The Q2 value of the shipments varied considerably depending on the device type:

  • Single-screw extruders increased by 33.1% compared to Q1 2021;
  • Twin screw extruders declined 24.9%;
  • Injection molding deliveries fell by 4.9%;
  • Deliveries of injection molding, single-screw and twin-screw extruders were 19.5%, 37.8% and 32.3% higher than in the second quarter of 2020, respectively.

Base demand upward trend

However, these figures do not give a complete picture of the overall situation in the plastics processing equipment market. According to Perc Pineda, chief economist at PLASTICS, orders for plastic equipment have increased, but persistent supply chain problems – bottlenecks in parts and components – mean longer lead times from order to delivery. “This explains the decline in deliveries in the second quarter. For the third quarter in a row, deliveries of plastic equipment were higher than in the previous year. The underlying trend in plastic equipment demand remains upside, still in line with the robust economic recovery, ”said Pineda.

Future suppliers of plastics machinery seem to largely agree with this analysis. In a Q2 poll conducted by CES, 92.7% of respondents said they expect market conditions to either improve or remain stable in the coming quarter. The percentage was slightly lower than the 93.5% of respondents who shared the same view in the Q1 survey. For the next 12 months, 78.7% expect a steady to better market situation. This is also less than the 93.0% of respondents in the previous quarter’s survey who expected growth over the next 12 months.

US plastic machinery trade deficit up 12.6%

Total plastic machine exports in the second quarter of 2021 were down 6.9% from the first quarter, totaling $ 367.6 million. Mexico and Canada remained the most important export markets for US plastics machines. Combined exports to USMCA partners were $ 177.2 million in the second quarter, accounting for nearly half of all plastics machinery exports. Imports rose 3.5% to $ 874.0 million, resulting in a trade deficit of $ 506.8 million. The US plastic machinery trade deficit increased 12.6% in the second quarter.

The volume of trade is expected to increase this year as global economic conditions improve. The World Trade Organization expects global trade in goods to increase by 8.4% this year.

“Until the supply chain problems are resolved and production lead times return to normal, [we should] expect quarterly plastic machine shipments to fluctuate, ”Pineda said. “Nevertheless, the prospects for plastics machinery manufacturing in the second half of the year are positive,” he added.

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