Plastics machinery shipments down in Q1 but “poised for growth,” report says
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North American shipments of primary plastics machinery decreased following three consecutive quarters of growth, the report says.
Shipments of primary plastics machinery (injection molding and extrusion) in North America came in lower in the first quarter of 2021 than in fourth quarter 2020, according to new figures compiled and reported by the Plastics Industry Association’s Committee on Equipment Statistics (CES).
The decrease follows three consecutive quarters of growth, CES said.
“The preliminary estimate of shipment value from reporting companies totaled US$334.9 million in first quarter 2021, an 11.1 per cent decrease from the previous quarter,” CES said. “However, compared to first quarter 2020, plastics machinery shipments increased by a solid 31.9 per cent. This was the third consecutive quarterly increase in plastics machinery shipments year-over-year.”
“Plastics machinery shipments usually start slow every first quarter, so it was not surprising to see the data came in lower,” said Perc Pineda, Ph.D., the Washington, D.C.-based organization’s chief economist. “This is in sync with overall economic activity that is usually slow, starting every first quarter. Judging from a year-over-year comparison, plastics machinery shipments were actually off to a good start. With the economy staying in a recovery cycle, plastics machinery shipments can be expected to increase this year. However, supply chain issues in plastics end-markets could slow growth in plastics equipment demand, so we’ll be watching market dynamics very closely in the coming months.”
Although the value of shipments of injection molding equipment decreased by 11.1 per cent in Q1 2021, it was 39.8 per cent above Q1 2020. The value of shipments of single-screw extruders fell 38.3 per cent from Q4 2020 and was 28.9 per cent lower than Q4 2020. “Shipments of twin-screw extruders, however, soared by 42.3 per cent in first quarter 2021 and rose by 18.3 per cent over the same period in 2020,” CES said.
Plastics machinery total exports in Q1 2021 increased by 9.4 per cent to US$395.0 million over Q4 2020, CES said, while imports fell by 3.5 per cent to US$845.0 million, resulting in a US$450.0 million trade deficit, which was 12.6 per cent lower than in Q4 2020. “The volume of merchandise trade is expected to increase this year as global economic conditions improve,” CES said.
The CES also conducts a quarterly survey of plastics machinery suppliers that asks about present market conditions and expectations for the future. In general, outlook among plastics machinery suppliers is “very optimistic,” it said.“The equipment sector of the plastics industry came out of 2020 strong. The much-improved trade outlook will be a positive for plastics equipment suppliers on top of what can be expected as another good year for plastics equipment demand,” Pineda said. In the coming quarter, 89.5 per cent of respondents expect conditions to improve or hold steady compared to a year ago, lower than the 96.0 per cent that felt similarly in the previous quarter. As for the next 12 months, 93.0 per cent of those surveyed expect market conditions to be steady-to-better. This is higher than the 89.8 per cent in the Q4 2020 survey.