Plastics industry shows signs of growth amidst tough economy

Apparent plastics consumption growth in 2014 in South Africa versus the country’s GDP growthPlastics SA reported on solid growth during the last financial year and a positive outlook for 2016 at its Annual General Meeting, which took place at the company’s head office in Midrand, Gauteng on 22 October 2015.

‘Although we certainly need to take heed of warnings from reliable economists, it is not all doom and gloom in the South African plastics industry,’ Philip de Weerdt, outgoing chairman of Plastics SA told board members and other parties in attendance. ‘Despite some of the plastics subsectors experiencing a downturn in demand, as they struggle to adjust to increased imports and changes in the market for their products, key opportunities still exist for growth.’

According to the latest figures released, local plastics consumption has seen a year on year increase in recycled (diverted) tonnages of nine per cent, while virgin tonnage consumption has stagnated at 1.4 million tonnes. When compared against the GDP growth of less than two per cent during the same period, this is an achievement of which the plastics industry can be proud.

Growing plastics applications

An increased demand for all applications of plastic by the country’s growing middle class has also had a positive impact on the industry this past year. Of the 1.4 million tonnes of plastics that entered the market during the past year, approximately 55 per cent of all polymers went into packaging. A figure of 29 per cent of this was used in rigid packaging and 26 per cent used for flexible packaging. The third largest application of plastics in South Africa was in the building and construction industry (15 per cent), followed by electronic appliances, automotive and transport industries, engineering, agriculture and houseware.

Polyolefins, including high-density polyethylene, low-density polyethylene and polypropylene, made up approximately 57 per cent of the plastics market, followed by PET with 13.86 per cent, PVC with 11.09 per cent, and polystyrene with 4.2 per cent. Multi-layered and other plastic packaging materials made up 14.49 per cent of the market.

According to Plastics SA, the recycling of the majority of these different types of plastics is now successfully driven by material recovery organisations such as POLYCO, Petco, the Southern African Vinyls Association and the Polystyrene Packaging Council. They act as a “conscience” for the plastics industry by getting membership buy-in from plastic producers and spending the funds received on worthy recycling initiatives that increase the recycling rate of plastics.

Growing plastic recovery and recycling

Last year Plastics SA set the pace for the recovery, recycling and diversion of plastics from the country’s landfill sites with its vision of “zero plastics to landfill by 2030”. According to the industry body’s executive director, Anton Hanekom, the most recent recycling survey has shown that plastic diverted from landfill increased by 12.8 per cent from 2013.

‘The plastics recycling industry is showing positive movement and due to the increase in the use of waste plastic as an input material in the conversion process, the demand for plastic waste locally has increased,’ explains Hanekom. The total plastic tonnage recycled was 20.3 per cent of all plastics manufactured in 2014. An amount of 22 per cent of plastics was diverted from landfill, 90.2 per cent was mechanically recycled and 9.8 per cent was exported for recycling elsewhere.

Looking ahead

Government has requested the plastics industry to submit its waste management plans for the various sectors. Hanekom notes the leadership is hopeful that this might be an indication that the industry will be allowed to continue with current initiatives, without too much interference from government.

‘During this past year, the plastics industry was forced to embrace change, adapt and face enormous challenges in a struggling economy, which doesn’t always facilitate local manufacturing. We are grateful to those members of the industry who contribute towards our activities by way of membership fees,’ he says.

New board members announced

Plastics SA announced the names of its newly elected board members for 2016. They are:

  • Anton Hanekom from Plastics SA
  • Bernhard Mahl from Safripol as Chairperson
  • Douglas Greig from Tuffy Manufacturing as Deputy Vice Chairperson
  • Jeremy Mackintosh from Polyoak Packaging as Deputy Vice Chairperson
  • Douw Steyn from Plastics SA as Ex-officio
  • Jaco Breytenbach from Transpaco Recycling
  • Jan Venter from SAPPMA
  • Loutjie de Jongh from Mpact
  • Mxolisi Khutama from Nampak Limited
  • Bob Bond from PISA
  • David Mokomela from Sasol Base Chemicals
  • Mike Myers from EPSASA
  • Leigh Pollard from HOSAF
  • Rowan le Roux from Polyoak Packaging
  • Wayne Wiid from Pioneer Plastics
  • Fernando Lopes from Engen Petroleum
  • Helmut Oellermann from Plastichem