A global overview of the TPU market

London-based IAL Consultants has recently published a second edition of its report entitled A global overview of the Thermoplastic Polyurethane market. This market is relatively mature in the Western hemisphere while strong growth prospects exist in the East, particularly in China. The Asian region leads world TPU production and consumption at a total of 174,500t in 2007, thereby accounting for 47% of world demand of 370,050t.

Production trends have been and will continue to be shaped by the increasing presence of European manufacturers in Asia. Mergers and acquisitions continue to be commonplace within the TPU industry, especially in Asia where overcapacity remains an issue. The growth of the Asian market and cheaper manufacturing costs has resulted in many Western companies increasing their presence in the Asian continent. This is also due to the demand for higher quality materials that are currently un­available from domestic producers. This trend is expected to continue in the future, in particular after the current economic downturn comes to an end.

Environmental pressures have led to the production of a small volume of bio-based TPU material. It is proving difficult to justify the need for bio-content in this type of material, but a few hundred tonnes are now being sold around the world. At the opposite end of the life cycle, recycling is becoming increasingly important and this is already well-trenched in the automotive and electronics sector. TPU are fully recyclable, as is the waste formed during production, making it a cost effective material from which to mould or extrude components.

Many specialist applications are among the target markets of TPU producers, either in terms of the advanced performance attributes of TPU or as a substitute for other materials where the effects of legislation have reduced their consumption. Two important features of TPU are the softness and flexibility they can offer without requiring the additives and plasticisers that PVC and other heavily compounded materials rely upon.

This argument is becoming stronger: More innovative chemistries are now expanding the application range for TPU for many major industries - notably, medical, automotive, textile, and food. TPU producers now avoid using additives that can interfere with characteristics that users want. Overmould bondability to other thermoplastics, textiles, and metals remains a focus of R&D. Regulatory and market demands are also forcing suppliers to develop new materials without halogenated flame retardants and with lower volatile emissions (auto fogging).

Engineering and footwear are the two most dominant applications for TPU, accounting for 105,230t and 101,290t of TPU respectively and together they account for 55% of the global market. The pattern of global TPU consumption by sector is shown in figure 1 and table 1.

The versatility of TPU continues to drive investment in their development and commercialisation around the world:

Merquinsa has invested heavily in TPU, having launched bio-polyol-based types for injection moulding, extrusion, and adhesives applications Materials with superior heat-resistance are being developed by companies such as BASF and Lubrizol. These materials target sectors such as the automotive, cable and wire applications as a result of smaller wires and tighter packing. Cable jacketing applications abound, especially for those companies which are able to offer halogen-free materials.

In the Asia-Pacific region, China, Taiwan, South Korea and Japan tend to dominate the production scene. China is by far the largest producer and consumer of TPU at 108,000t in 2007, attracting investment from top players such as BASF and Lubrizol along the way.

Shoe materials are especially important TPU applications in Eastern Asia.

Extrusion grades represent the largest share of the North American market. Extruded sheet is used in construction and security glazing applications as well as in textile and fibre coatings.

Growth forecasts for the global TPU sector vary considerably according to region. Projected growth for the EMEA markets is placed at about 4% pa over the period 2007 – 2012 but in the Americas this is seen at around 0.7% pa.

In both of these regions a net contradiction of the footwear sector is foreseen, while the automotive sector in the Americas is also expected to contract sharply in line with declining production and the switch to lower cost materials. Medical applications for TPU do continue to grow, albeit from a small base.

As a result of some Asian economies escaping the full effects of the economic crisis, as well as benefiting from the transfer of manufacturing operations from mature economies, growth in the Asian TPU market is placed at 10.5%pa. Given the relative market sizes, the total forecast global annual between 2007 – 2012 is forecast to be 6.6%.

Tab.1: Global production of TPU, by region, 2007 (tonnes)

Source: IAL Consultants