Plastics News Europe - July/August 2019 - 6

MARKETS & BUSINESS

Meeting new standards
Bulgaria has used low costs to build export sales - and looks to
quality to maintain them. By Diana Yordanova, in Brussels

ulgaria's plastics industry has
been making the most of the
growing demand for supplies
from major western markets. The sector has been particularly buoyant over
the past five years, with Bulgaria's
comparatively low costs and occasional regulatory light touch making
its plastics companies competitive
with competitors in western Europe.
In particular, the country has seen the
order volume for components for the
automotive industry expand significantly. Also, there have been substantial investments in its plastic packaging segment, driven by growth in
demand for polymer-based products
worldwide. "Companies strive to export to foreign markets as the Bulgarian market is relatively small, and due
to low production costs in Bulgaria,
large western companies are relocating here," the president of Bulgaria's
Branch Association Polymers industry
group (https://bap.bg/en/), Tsvetanka
Todorova told Plastics News Europe.
Equipment in Bulgaria's plastics sector
is also regularly upgraded with the
support of European Union (EU) economic development programmes, increasing its competitiveness, she said.
This includes increasing capacity for
making plastics from biodegradable
materials, which are gaining in popularity, said Todorova.
Data from EU statistical agency Eurostat shows that in 2018, Bulgaria
exported a record for the country's
plastics sector of 420,000 tonnes,
nearly 75% of which was sold to other
EU member states. By comparison, in
2014 Bulgaria's plastics sector exported around 307,000 tonnes, split between 201,000 tonnes to the rest of
the EU and 106,000 tonnes to third
countries - indicating robust growth.
That said, these general statistics
do not mean all plastics companies in
Bulgaria are having an easy time.
Speaking to manufacturers in Bulgaria, it is clear that many of the 160
plastics producing companies in the
country are facing challenges of various kinds. Biljana Pop-Petrovska,
managing director of Bulgarian manufacturer Carboplast noted that some
companies are carrying significant
debt that in some cases is "a very
high and risky level". She added that
buyers are pressuring Bulgarian manufacturers on cost: "Every client
wants quality material at a low cost
which results in cost reduction and

BULGARIA

unfair competition", said Pop-Petrovska, whose company is a subsidiary
of Italy's TVP Compound. Carboplast's production mainly focuses on
the widely produced synthetic plastic
polymer polyvinyl chloride (PVC), often used in construction, cables,
tubes and packaging. And this is a
tough segment: "The market is very
competitive, and perhaps it is developing, but volumes are not increasing
dramatically", she added. Very similar
is the experience of PVC hose producer Plexistab, whose executive director
Bilyana Kutseva said that this segment's profitability is particularly vulnerable to price shifts in ingredients:
"Control is not always in our hands.
We depend on the macro framework
of the entire sector and the policies of
certain companies", she stressed.
On the plus side, with its strong
export performance, Bulgaria's plastics sector is well-connected with the
comprehensive web of plastics suppliers and customers that spans Europe.
The diversity of this market means
that Bulgaria's plastics sector has a

Biljana Pop-Petrovska,
Carboplast: "Every
client wants quality
material at a low cost
which results in cost
reduction and unfair
competition"
6

sustainable position within Europe.
The owner of Bulgarian thermoplastics manufacturer Pro Grup Bulgaria,
Dimitar Grigorov, said his company
had solidified its market position
since being launched in 2011 in Bulgaria's second city Plovdiv, serving clients in Germany and Switzerland and
outsourcing to manufacturers based
in Bulgaria. In the past two years, Pro
Group has produced prototypes, selling standard, engineered and
high-performance plastics in granules, tiles or panels to car makers in
Germany and Hungary for making tail
lights, visually attractive colour trims
and films for interior automobile linings. Grigorov added that his company has started receiving inquiries from
American companies for possible
new export sales.
Plexistab, likewise based in Plovdiv,
has also been diversifying its market.
Producing PVC reinforced hoses for
suction and pumping water, handling
heavy duty water discharge, and delivering liquid fertilisers and chemicals,
the company mainly targets the agricultural sector. However, it has also
been supplying to other client segments, such as pools, cable protection,
air ventilation, and drinks makers, including wine. "More than 86% of our
production is export-oriented. We export mainly to Europe, but we also
have regular customers from countries
in Asia, Africa and Australia," Bilyana
Kutseva noted. From neighbouring
Greece and Romania to the Netherlands, England, Belgium, France, Italy
and Ukraine, Plexistab has realised the
need to target its clients carefully. One
issue it keeps an eye on is extremes in

JULY/AUGUST 2019

https://www.bap.bg/en/

Plastics News Europe - July/August 2019

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