The global liquid crystal polymer (LCP) films laminates market is valued at 7,470 metric tons in 2020, and it is expected to register a CAGR of more than 5.5% during the forecast period 2021-2026
COVID-19 had an adverse effect on the global economy, further disrupting industrial investments and outputs. Additionally, the virus has affected parts of Asia, North America, Europe, and the Middle East very hard. Some states or regions were under complete lockdown for a specified period. Most factories were running on minimal staffing or even closed temporarily. For instance, according to the OICA data, global automotive production declined significantly in 2020 due to the pandemic, registering a declining growth of 16% in 2020. Compared to the last two years, the top 20 global auto manufacturers witnessed negative growth and registered losses by approximately USD 100 billion in 2020. Due to this, radars, sensors, and other components, made by LCPs and the demand for LCP film and laminates witnessed negative growth in this period.
Key Highlights - Over the medium term, major factor driving the market studied is the increasing demand for miniaturization of electrical and electronic components.
- On the flip side, slowdown in automotive industry and unfavorable conditions arising due to the COVID-19 outbreak are hindering the growth of the market.
- The electronics segment is expected to dominate the application segment of the global liquid crystal polymer films laminates market as it offers excellent mechanical and electrical properties such as low dielectric constant, high moisture barriers, and high frequency, among others.
- Asia-Pacific region represents the largest market and is also expected to be the fastest-growing market over the forecast period owing to the consumption from countries such as China, South Korea, India, and Japan.
Key Market Trends
Electronics Segment is Expected to Dominate the Market
- LCP films and laminates have widened application scope across electronics industry. LCP films offer excellent electrical and mechanical properties such as low dielectric constant, high moisture barriers, controllable thermal coefficient of expansion, high-frequency properties, and non-halogen flame-retardant characteristics. - LCP material’s excellent macroscopic properties are determined by its unique molecular structure. LCP is a completely aromatic liquid crystal polyester polymer with a stiff polymer chain structure. Due to the uniqueness of the molecular structure, it has good vibration absorption characteristics, low dielectric properties, self-reinforcing effect, good chemical resistance and heat resistance, low melt viscosity, low linear expansion rate, low molding shrinkage rate, and excellent extinguishing. LCP also has low moisture absorption and high dielectric performance, making it an ideal material candidate for flexible printed circuits (FPCs), antenna substrates, and housings. - As the demand for the internet of things (IoT) products, 5G cellular networks, and video-streaming services expands, the capacity to transfer far greater volumes of data through typically much smaller wired and wireless devices at much higher rates becomes more crucial and complex. As a result, all components used in electronic interconnects are carefully inspected to minimize signal loss/decay, distortion, and interference. In order to upgrade the performance of high-speed connectors and other electronic and electrical components, manufacturers have started to employ high-performance liquid crystal polymers (LCPs). - Faster processing rates and larger circuit density with a lower profile, thinner connectors have made thermal management a more concerning problem, resulting in higher thermal requirements for interconnect materials. To counter these issues, electrical and electronics manufacturers started to employ lower dielectric constant polymers, such as LCP films and laminates. - Even the smallest electronic equipment, such as a cellular phone or a mobile PC, requires high-speed signal transmission across GHz. Due to its outstanding electrical characteristics, such as a low dielectric constant, liquid crystalline polymer (LCP) film is attracting a lot of interest in the circuit board lamination for electronic packaging. - Global electronics output has recovered quickly as the global economy and main consumer markets gradually emerged from severe economic depression in the first half of 2020. This recovery is reflected in China’s electronics export data, which surged sharply in November 2020, climbing 24.8 % year on year due to strong Christmas demand for consumer electronics in key international markets, most notably the United States and the European Union. - The increase in global demand for personal computers (PC) mitigated the pandemic’s negative impact on consumer electronics consumption, which remained flat in 2020 at USD 1.02 trillion. According to Statista, global consumer electronics revenues are predicted to expand by 3.6% year on year (YoY) and reach USD 1.06 trillion in 2021. Despite a boom in PC demand due to remote working and distance learning, the computing segment’s revenue is predicted to grow by only 1.8%, to USD 280 billion in 2021. - Therefore, with the growth of the electronics industry, the demand for liquid crystalline polymers films laminates is likely to rise during the coming years.
China to Dominate the Asia Pacific Region
- Asia-Pacific is anticipated to witness the highest CAGR during the period on account of rapid expansion and consumption of the electronics and automotive industry from countries like China, South Korea, Japan, and India.
- China is the largest electronics production base globally and offers tough competition to the existing upstream producers, such as South Korea, Singapore, and Taiwan. Electronic products, such as smartphones, OLED TVs, and tablets, among others, witness the highest growth rates in the consumer electronics segment of the market, in terms of demand.
- With the increase in the disposable incomes of the middle-class population, the demand for electronic products is projected to increase steadily in the future, thereby, driving market growth.
- China is the largest user and producer of smartphones. In January and February 2021, it has produced 208.59 million cell phones. It had around 935.24 million smartphone users in 2020 and is forecasted to reach 1.14 billion smartphone users by 2025. The revenue in the consumer electronics segment is projected to reach USD 162,038 million in 2021.
- The revenue is expected to show an annual growth rate of 2.04%, resulting in a projected market volume of USD 175,670 million by 2025.Furthermore, in June 2021, the total retail sales of consumer goods in China increased by about 12.1%, compared to the same period of the previous year. The total retail sales value of consumer goods amounted to CNY 3.76 trillion in that period.
- The Chinese automotive manufacturing industry is the largest in the world. The “Made in China 2025” initiative is anticipated to support the upgrade of the existing low-cost mass production to higher value-added advanced manufacturing.
- According to the China Association of Automobile Manufacturers (CAAM), automotive production declined by about 2% in 2020. The country produced 25,225,242 units in 2020, which declined from 25,750, 650 units in 2019. However, in H1 2021, the production reached 12,569,475, which increased by 24% over H1 2020.
- The Chinese healthcare industry is the second largest industry across the world after the United States, and it registered a revenue of USD 1.1 trillion in 2019. China is expected to have 25% of the global healthcare industry revenue share by 2030. This is expected to increase the demand for liquid crystal polymers films laminates in medical applications.
- Due to the aforementioned factors, the demand for LCP films and laminates is expected to increase in the region during the forecast period.
The Global Liquid Crystal Polymer (LCP) Films Laminates Market is partially consolidated in nature with a few major players dominating a significant portion of the market. Some of the major companies are Polyplastics Co., Ltd., Celanese Corporation, Sumitomo Chemical Company, Solvay and KURARAY CO., LTD. and among others.
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