Covid-19 pandemic accelerates the trend for efficiency in crop production and technical innovation shaping the agricultural films market

AMI, Bristol, 15/06/2020 – Agricultural productivity and output have increased significantly over the past sixty years, plastic agricultural films has made a fundamental contribution to this development. The agricultural sector is challenged with the task of feeding a rapidly growing world population while managing increased scarcity of resources such as water, agricultural land and soil. In order to meet these challenges, agriculture is a key sector for technological innovation where concepts including smart farming, precision agriculture, and the use of innovative agricultural films for productivity improvements are increasingly prevalent.

The 2020 edition of AMI’s Agricultural films – The global market report is the result of an extensive research programme, providing a detailed independent assessment of this industry in times of uncertainty as a direct result of the Covid-19 pandemic. The report quantifies demand and production of film for silage, mulch and greenhouse applications as well as the relevant sub-applications for each of the three types of film in each world region with a five-year forecast.

The detailed research conducted by AMI finds that despite issues related to labour constraints in horticulture, so far demand for agricultural films has remained almost undamaged by the virus outbreak. Key reasons for this stability include a consistently strong underlying demand for agricultural products, the fact that farming is a sector where social distancing is easier to maintain, and the critical necessity for markets that orbit around agricultural production to stay operative.

The continuous need for more efficient food production is driving the adoption of agricultural films especially in developing regions and those with challenging climatic conditions which have embarked on the adoption of modern agricultural techniques relatively recently. Brazil, in particular, is a country of opportunities for the agricultural films market. Despite obstacles posed by implementation costs and inefficient use of water for irrigation, the rising adoption of more sophisticated technology and the abundance of natural resources give good grounds for expecting future substantial growth.

In more mature markets, developments are technology-driven and are reflected in resin usage dynamics. The focus is currently on those materials that allow higher yield (as they provide improved thermicity, photo-selectivity, elasticity etc.), that facilitate downgauging, that lower the pressure on virgin resins (e.g. recycled materials used in the production of silage and mulch film) and adhere to biodegradability standards.

At the same time, these technology advancements have an impact on the growth trajectory of the industry from a consumption volume perspective. For mulch and greenhouse film, the trend towards downgauging holds back volume growth, while the greenhouse film segment is also affected by the development of longer lasting films. Mulch and silage film demand, moreover, is impacted by the requirement for plastic waste reduction, higher recyclability and increasing use of recycled materials in resin formulation.

In such a time of uncertainty, this comprehensive study will guide industry players in formulating coherent strategies and exploit emerging business opportunities within the agricultural segment of the polyethylene films market.

For further information, please contact Elena.Mozzato@Ami.international, AMI Consulting.

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