The United States Expandable Polystyrene industry which currently has a production capacity 370 Kilotons is anticipated to grow at a CAGR of ~2.9% in the next five years as per the findings of Ken Research.
STORY OUTLINE
- Increasing construction and building processes increase the demand for ESP as it is to be used in areas of thermal insulation, sound proofing, concrete formwork, etc.
- Rising sales of automotive vehicles also raise the demand for ESP as it is typically used for seat cushioning, interior trim components, head impact protection, etc.
- Rising customers’ demands for sustainable packaging also increase the demand for ESP as it is an environment friendly product.
- Rapid urbanization means more e-commerce automotive sales and construction process which all ultimately accelerate the demand for ESP.
A Fast Growing industry, rapid construction processes, rising automotive sales and rapid urbanization along with increasing customers’ demands for sustainable packaging are the various reasons contributing to the growth of US Expandable Polystyrene market. This market is expected to grow at a CAGR of ~2.9% in between 2022-2028.
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1. Rising construction processes: accelerating the US Expandable Polystyrene market
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Buildings and construction processes are a huge user of Expandable Polystyrene (EPS). In constructions and buildings, this compound is used in various areas such as thermal insulation, sound proofing, concrete formwork, roofing systems, acoustic insulation, pre-fabricated panels etc.
The construction processes in the United States are on high rise considering the fact that US is a developed nation. We can also understand this by taking a look at the total amount spent on constructions over the past four years in the US.
Speaking of Residential construction, ~USD 0.8 million, ~USD 1 million, ~USD 1.2 million and ~USD 1.5 million was spent in 2019, 2020, 2021, and 2022 respectively.
For Non-Residential construction, ~USD 1.8 million, ~USD 2 million, ~USD 2.5 million and ~USD 3 million was spent in 2019, 2020, 2021, and 2022 respectively.
For Public construction, ~USD 3.8 million, ~USD 4.2 million, ~USD 5.5 million and lastly ~USD 6 million was spent in 2019, 2020, 2021, and 2022 respectively.
As the construction in the country rises, the demand for Expandable Polystyrene rises as it is to be used in various areas of building also, which helps in the growth of the US Expandable Polystyrene market.
2. Rising automotive vehicles: rising the demand for EPS in the country
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Automotive vehicle industry is another area where there is a high use of Expandable Polystyrene. This is primarily due to the fact that EPS is used in various areas of automotive vehicles such as seat cushioning, interior trim components, head impact protection, Instrument panels, child car seats, acoustic insulation, sun visors, cavity filling, etc.
Automotive vehicles are on rise in the United States. Almost 92% of the households in the US have at least 1 automotive vehicle. Moreover, US have always sold automotive vehicles equal to or more than 14 million.
For instance, in 2018, there were ~17.25 million automotive vehicles sold. In 2019 as well, approximately 17 million automotive vehicles were sold. US witnessed a sharp decline in the sale in 2020 considering the global pandemic. In 2020, almost 14.5 million automotive vehicles were sold.
In 2021, the number again started progressing and almost 16 million automotive vehicles were sold. Lastly in 2022, again, almost 15 million automotive vehicles were sold.
With the rising sales of automotive vehicles, the demand for Expandable Polystyrene also increases since it is used in many areas of vehicles. The rising demand for EPS ultimately contribute to the growth of the US Expandable Polystyrene market.
3. Rising sustainable packaging: making use of Expandable Packaging
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The awareness regarding sustainable packaging is rising in the United States. Nowadays, customers are keen in ensuring that their products have sustainable packaging used even if it is costlier than the normal packaging.
In fact, 60-70% of the US buyers have no problem in paying higher price if it is getting them sustainable packaging. Even in the Covid-19 pandemic, more than 55% of the US buyers revealed that the chances of them buying a product are more if it has sustainable packaging used.
More than 70% of the US population states that they want to change their buying habits and shift towards the products that make use of sustainable packaging. And thus, more than 65% of the people think that it is extremely important for the environment that their products are in sustainable packaging.
The growing customers’ demands of sustainable packaging increase the demand for Expandable Polystyrene thereby contributing to the growth of US Expandable Polystyrene market as this compound is environment friendly.
This is primarily due to the fact that this compound has higher durability and provides resistance to moisture meaning it can be used over and over, which means it can be recycled. Moreover, due to its amazing thermal insulation, it also helps in saving energy by reducing the requirement of heating and cooling in the buildings.
4. Rapid urbanization: boosting construction, E-commerce and automotive vehicles
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The urbanization is increasing every year in the United States. In 2000s, 79% of the population was living in urban areas and 21% were living in rural areas. In 2010s, the number rose to 81% of the population living in the urban areas and 19% living in the rural areas. Currently, 83% of the population is living in urban areas and 17% of the people are still living in rural areas.
In 2030s, this number is projected to become 85% of the people living in urban areas and only 15% living in rural areas. In 2040s, we will have 87% of the people living in urban areas and only 13% living in rural areas. Furthermore, in 2050s, we will have 89% people living in urban areas and only 11% living in rural areas.
With rapid urbanization, the construction processes nationwide also increase. The E-Commerce also increases which ultimately increase the work of the packaging industry. Moreover, with rapid urbanization, the demand for automotive vehicles also rise which results in high sales of the automotive vehicles.
Since automotive vehicles, packaging and construction processes use Expandable Polystyrene as a key element; thus, the rapid urbanization ultimately helps in accelerating the US Expandable Polystyrene market.
CONCLUSION
Expandable Polystyrene (EPS) is a type of lightweight cellular plastic which is used in various fields such as building and construction, automotive vehicles, and sustainable packaging. Hence, the rise in automotive sales, rapid construction processes, and customer’s demands for sustainable packaging along with rapid urbanization are the various reasons that drive the US EPS market. As per Ken Research, this market is expected to grow at a CAGR of 2.9% in the next five years.
