Growth in Construction Sector Boosts Demand for Plastics

Alongside rapidly increasing residential investments in recent periods, government-backed mega projects have become the driving force for growth in the construction sector. The sector's upward momentum has increased the use of plastic building materials preferred in many areas from pipes to doors, from windows to insulation systems. Production of construction plastics, which ranks second within the plastic sector, reached 1.9 million tonnes by volume with a 3.8% increase in 2016 and USD 7.8 billion by value with an 8.1% rise. Domestic consumption of plastic building materials increased by 12% by volume to 1.5 million tonnes and by 14% by value to USD 7.1 billion. As one of Turkey's leading economic sectors, construction drives growth in many sub-sectors alongside it. With their long service life, heat resistance, cost advantage, energy efficiency and environmentally-friendly characteristics, plastics are rapidly rising in rank among materials used in the construction sector. Doors, pipe systems, hoses, ceiling and wall coverings, bathroom and kitchen sinks, and windows are now preferred almost exclusively in plastic. The Turkish Plastics Manufacturers Research, Development and Training Foundation (PAGEV) presented the sector's 2016 performance in its report on construction plastics, one of the most important production and export items of the plastic sector.

Construction materials rank second in plastic production

According to PAGEV's 2016 construction plastics sector monitoring report, 697 companies operating in Turkey's plastic building materials sector produce over 60 product varieties. The materials where producer companies concentrate most are profiles, clean and wastewater pipes, pipe fittings, window systems, bathroom and kitchen sinks and hoses. In 2016, Turkey produced 1.9 million tonnes of construction plastic with a 3.8% increase by volume compared to the previous year, and USD 7.8 billion with an 8.1% increase by value. Plastic building materials maintained their second rank position in total plastic product production with the production value they achieved in 2016.

Plastic construction materials exports reached USD 1.4 billion in 2016

In 2016, compared to 2015, plastic construction materials exports fell by 16% by volume to 585,000 tonnes and declined by 19% by value to USD 1.4 billion. Despite the decline in exports, Turkey maintains a net exporter position in foreign trade of plastic building materials. Among plastic building materials exported to over 150 countries, the top five countries were Iraq, Georgia, Algeria, Germany and Romania.

Plastic use in Turkey's construction increased by 12% by volume

In 2016, the plastic construction materials sector grew with a domestic market focus. Despite the decline in exports, the increase in domestic consumption drove sector growth. Accordingly, domestic plastic construction materials consumption reached 1.37 million tonnes by volume with a 12% increase in 2016 and USD 7.1 billion by value with a 14% increase. Noting that the plastic construction materials sector grew with domestic market focus in 2016, PAGEV Board Chairman Yavuz Eroğlu stated, "Construction activities in Turkey are undergoing transformation based on changing lifestyles and evolving needs. In line with new trends emerging in the sector in recent years, smart building systems, environmentally-friendly structures, modern living spaces, home-office systems and entertainment and activity centers have become indispensable elements of modern projects. As the importance of urban transformation increases in the residential market, non-residential commercial structures focus on social needs. Public-funded major infrastructure and transformation projects as well as international contracting works hold a significant share in the sector's workload. Particularly in major cities, direct foreign investments in the sector continue to increase. It is evident that residential production, which comprises approximately 60% of domestic construction sector production, is growing rapidly and has become the driving force for construction activity growth in recent years. We believe this process will continue in 2017. The macroeconomic and political environment, financing conditions, legal regulations, urban transformation, mega projects, demographic structure in the domestic market, rapid urbanization and increasing domestic content will be the factors driving growth," he said.