Saudi Arabia Polyvinyl Chloride (PVC) Market Research Report: Forecast (2023-2028)

Market Definition

Polyvinyl chloride (PVC) is a widely used synthetic plastic polymer produced from vinyl chloride monomers through a polymerization process. It is widely used in the manufacturing of construction materials, automotive components, electrical insulation, and various other components owing to its versatile, durable, and cost-efficient characteristics. Pipes & fittings, profiles & tubes, film & sheets wires & cables bottles etc., are the key application areas of polyvinyl chloride (PVC) across the globe.

Market Insights & Analysis: Saudi Arabia Polyvinyl Chloride (PVC) Market (2023-28)

The Saudi Arabia Polyvinyl Chloride (PVC) Market is projected to grow at a CAGR of around 4.5% during the forecast period, i.e., 2023-28. The market growth has been attributed to various factors like rapid urbanization & construction of residential & non-residential infrastructures contributed by the surge in the expatriate population of the country. The expansion in the construction industry has led to a surge in demand for building materials like pipes & fittings, wire & cables, and other materials which require PVC for manufacturing.

Besides, the government of Saudi Arabia is facing several challenges, especially in controlling the fiscal deficit, diversifying revenues, and minimizing dependence on the oil & gas sector. Therefore, to mitigate the dependence on the oil & gas sector, the government is investing & encouraging infrastructure development, such as the construction of hotels, theme parks, art galleries, metro lines, airports, etc. The government of Saudi Arabia has announced a nearly USD1 trillion pipeline of infrastructure projects, which aims to position Saudi Arabia as a global hub for investment & logistics in line with its Vision 2030. The development agenda includes numerous public infrastructure projects, like the Neom City, Riyadh Metro, Makkah Public Transport Program, etc.

Additionally, the increased tourism activity has promoted the hospitality sector in the country, as Saudi Arabia welcomes millions of pilgrims each year. According to the World Tourism Organization, over 18 million tourists traveled to Saudi Arabia in 2022, making it the most visited country in the Gulf region. Therefore, to further accommodate tourists in the country, the government is largely focusing on building hotels & leisure attractions, which would enhance the market growth.

Moreover, the government of Saudi Arabia has also been implementing policies & investing highly in the healthcare sector, including the construction of additional hospitals, to boost medical tourism in the country. Further, the government has planned to invest nearly USD 65 billion by 2030 in the healthcare sectors under its Saudi Vision 2030 plan, which would push the demand for PVC in the coming years, hence supporting the growth of the Saudi Arabia Polyvinyl Chloride (PVC) Market in the future years.

Saudi Arabia Polyvinyl Chloride (PVC) Market Driver:

Surging Construction of Residential Building to Lead the Market Growth – During the historical period, the residential sector experienced notable growth due to the increasing construction of housing units in the country. The emergence of government housing programs such as the Sakani housing program has been a key growth driver in Saudi Arabia's residential construction industry. The expansion of housing units significantly contributed to the demand for PVC construction materials like pipes & fittings, siding & cladding, window frames & profiles, roofing membranes, etc.

Furthermore, the government has been continuously investing in the residential sector to raise home ownership to reach nearly 70% by 2030. The government launched more than 90 residential construction projects across Saudi Arabia in 2020, intending to construct more than 140,000 housing units over the next few years. As a result, the expansion of residential projects would necessitate the demand for construction materials in the country. Also, the soaring need for construction materials in the country would push the demand for manufacturing PVC-made construction materials, therefore upscaling the growth graph of the Saudi Arabia Polyvinyl Chloride (PVC) Market.

Saudi Arabia Polyvinyl Chloride (PVC) Market Challenge:

Environmental Concerns Regarding the Polyvinyl Chloride to Limit the Market Growth – PVC production involves the usage of fossil fuels & energy-intensive processes, which contribute to carbon emissions. PVC often requires to use additives, such as plasticizers & stabilizers, which can potentially drain out and have environmental & health impacts. The disposal of PVC products also poses several challenges, as improper disposal or incineration can release harmful pollutants.

Saudi Arabia is increasingly focusing on sustainability & has been prioritizing eco-friendly products in the country. Hence, the construction of smart buildings & green buildings in the country has been relying on other eco-friendly alternatives like bio-based polymers, thermoplastic elastomers, high-density polyethylene (HDPE), etc., to limit harmful emissions. This frequent adoption of green alternatives is presumed to impede the Saudi Arabia Polyvinyl Chloride (PVC) Market progression.

Saudi Arabia Polyvinyl Chloride (PVC) Market Opportunity:

Expansion of Automotive Industry to Augment the Demand for PVC in the Forecast Period – In recent years, the automotive sector in Saudi Arabia has gained traction with the rising presence of automotive OEMs in the country to decrease the dependence on automotive imports. Automotive manufacturing is witnessing a surge in investment to meet the local & export-based demand for automobiles. Thus, the government has taken various initiatives like the National Industrial Development and Logistics Program (NIDLP) in 2019 to develop the automotive manufacturing industry as a plan to diversify the economic base. Due to the strong support from the government, the companies like Saudi National Automotive Manufacturing Company (SNAM) and Lucid Motors started manufacturing automobiles during the historical period.

Additionally, the Ministry of Industry and Mineral Resources and the Saudi Industrial Development Fund (SIDF) also aim to manufacture more than 300,000 cars annually by 2030, which would further promote the automotive sector. Hence, the expansion of Automotive OEMs in Saudi Arabia would propel the demand for PVC for manufacturing car components like dashboards, door panels, seat coverings, seals & gaskets, etc., creating a lucrative opportunity for the Saudi Arabia Polyvinyl Chloride (PVC) Market during the forecast period.

Saudi Arabia Polyvinyl Chloride (PVC) Market Trend:

Growing Demand for Bio-based Polyvinyl Chloride (PVC) Products – The government of Saudi Arabia has been taking the initiative for the usage of sustainable & eco-friendly products in the country. Research & development efforts have focused on developing bio-based alternatives to conventional PVC. These bio-based PVC formulations incorporate renewable resources, such as plant-based feedstock or agricultural waste, reducing the reliance on fossil fuels. Bio-based PVC offers similar properties & functionality while reducing the carbon footprint associated with PVC production. Hence, the implementation of various stringent carbon emission norms like the Circular Carbon Economy National Program & the reduction of carbon emission by 278mtpa by 2030 target by the government would lead to the penetration of bio-based polyvinyl chloride, consequently becoming a trend in the Saudi Arabia Polyvinyl Chloride (PVC) Market during 2023-28.

Saudi Arabia Polyvinyl Chloride (PVC) Market (2023-28): Segmentation Analysis

The Saudi Arabia Polyvinyl Chloride (PVC) Market study of MarkNtel Advisors evaluates & highlights the major trends & influencing factors in each segment & includes predictions for the period 2023–2028 at the national levels. Based on the analysis, the market has been further classified as:

Based on Product Type:

• Rigid
  • Clear Rigid PVC
  • Non-clear Rigid PVC
• Flexible
  • Clear Flexible PVC
  • Non-clear Flexible PVC
• Low-smoke PVC
• Chlorinated PVC

Rigid PVC held a significant share in the Saudi Arabia Polyvinyl Chloride market due to its application to manufacture pipes & fittings, wires & cables, films & sheets, bottles, etc. The respective products are required in extensive quantities in Saudi Arabia owing to large-scale construction activities taking place in the country. The government’s focus has increasingly turned to the housing shortage in Saudi Arabia due to the surging expatriate population in the country seeking employment opportunities.

The Saudi Vision 2030 has led to the establishment of various multinational companies creating job openings for expatriates in various fields. With the growing presence of business establishments in the country, the demand for new commercial places would further grow, enhancing the need for several construction materials. Moreover, rigid PVC offers excellent durability, strength, and chemical resistance, which makes it suitable for various industries, including building & construction, automotive, and electrical industries. Hence, the continued expansion of construction activities in the country would lead to the demand for rigid PVC in the coming years as well.

Based on Application:

• Pipes & Fittings
• Film & Sheets
• Wire & Cables
• Bottles
• Others (Profiles, Hoses, etc.)

Out of them, the pipes & fittings are estimated to grow at a moderate rate during the forecast year due to the growing requirement in the construction, oil & gas, water & wastewater, and other industries. Saudi Arabia has been investing heavily in infrastructure development, including the construction of residential buildings, commercial complexes, industrial facilities, and public infrastructure. According to the Arab Monetary Fund (AMF), Saudi Arabia was the leading country in the Middle Eastern region in 2021, as it contributed the most to the country’s GDP, with around USD 45.5 billion in the construction sector. These construction projects require an extensive network of pipes & fittings for plumbing, water supply, drainage, HVAC systems, etc., further proliferating the Saudi Arabia Polyvinyl Chloride (PVC) Market.

Based on End Users:

• Construction
• Automotive
• Packaging
• Electrical & Electronics
• Consumer Goods
• Others (Healthcare, Signage & Advertising, etc.)

Construction captured a significant market share during the historical period & is predicted to hold the same position in the coming years owing to the government's focus on diversifying the country’s economy towards non-oil-based sectors. The hospitality sector has gained significance in the country due to the country’s focus on boosting the tourism industry & the prevalence of pilgrims' sites in the Mecca & Medina region.

Moreover, the government has been continuously investing in the tourism industry, with around 23 projects being under development, comprising around USD 4.26 billion as an investment. In 2023, the Saudi Ministry of Tourism signed a USD 346 million contract with Inter Continental Hotels Group (IHG) and Tasheed Contracting Company for the development of 12 new hotels across the country, which would boost the demand for PVC-based materials in the upcoming years. Hence, the rising support by the government to develop Saudi Arabia as one of the most attractive destinations for tourists would augment the Saudi Arabia Polyvinyl Chloride (PVC) Market in the forecast period.

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