Challenges facing the industry
Dec 28, 2023| (1) Changes in raw material prices
The main raw material in the plastic products industry is plastic particles. The price of plastic pellets is easily affected by many factors such as macroeconomic growth, strict environmental protection policies, oil price fluctuations, US dollar exchange rate fluctuations, international and geopolitical factors, etc. However, plastic product companies basically lack bargaining power over plastic pellet companies, and there is a certain lag in price adjustments.
(2) Fluctuation in demand from downstream industries
The plastic products industry has many product categories and strong industrial correlation. It is one of the important industries in the national economy. Affected by the slowdown in macroeconomic growth, the demand for plastic products from end consumers and end product manufacturers is subject to certain fluctuations in the industry's cyclical effects. Some industries, such as the automobile industry, have seen demand decline for a certain period. In this case, industry competition becomes more intense and profitability faces challenges.
(3) High-end raw materials and high-end equipment rely on imports
The main raw materials of plastic products are general plastics, engineering plastics, special plastics and modified plastics. High-end raw materials such as special engineering plastics, modified plastics, and plastic additives used in the domestic plastic products industry mainly rely on imports, and high-end equipment is highly dependent on imports. The low level of autonomy in high-end raw materials and equipment is an unfavorable factor that restricts the industrial structure upgrading and innovative development of the domestic plastic products industry.