Brazil 4 Business

Rubber and plastic industry

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Graphic - Distribution of rubber and plastic business by size - 2012 The industry of Rubber and Plastic products has a different behaviour from most of the activities that are very dependent on the economic momentum. This is partly because even in low-growth situations, the current trend of substitute materials, driven by technological advances, compensates other variables. Therefore, revenues had considerable progress in the last 10 years.

The nature of this industry is clearly regional, with 94% of the companies with 99 or fewer employees with a family character. Therefore, see two clear opportunities displayed:
 

  • The development of new products, currently done by large and medium-sized businesses who are the large minority;
  • Continuous exploration of the substitution of materials, especially in industries with large scale like automobile, construction and packaging.


The plastics processing industries are concentrated in the south and southeast, about 75% of workers are in this region, or in the vicinity of petrochemical complexes, as in Bahia. Based on the behaviour of the previous 5 years, until 2013 this sector’s revenues grew 8% per year and have tendencies to remain constant. Brazil imports R$ 5 billion more than what it exports. The main imported products are large bottles, bottles and alike, a few plates, sheets, stickers and tapes, corks and caps. 
 
The rubber industry has further polarized concentration because 90% of companies are in the South and Southeast. This is understandable because 58% of revenues come from the automobile manufacturers (concentrated in these regions) and the rest of it is much spread between footwear, mining and steel, electronics, entertainment, health and others. Good part of the raw material of natural rubber comes from the North, still little explored.
 
As an incentive to the polymer chain transformation, the federal government offers tax incentives on the purchase of raw materials, reducing the costs of domestic products and becoming internationally competitive.

 

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