The European powder coatings market

FOCUS The European powder coatings market In 2006 the European thermosetting powder coating consumption estimate based on figures prepared by Rohm and Haas, was 379,000 metric tonnes. Estimates for other world markets were: US & Canada 170,000 tonnes; Asia 403,000 and the rest of the world 152,000 tonnes, making a world total of 1,104,000 tonnes. The compound annual growth rates (CAGR) for Europe and North America were expected to rise with the gross domestic product rates for these areas. Asian CAGR for 2007-2009 predicted to be up 8-12% and the ROW up by 5-7%. Total world CAGR up 3-5%. The main factors facing the European powder coatings market today are: over-capacity, leading to intense competition among the powder manufacturers; reduced numbers of new conversions from liquid technologies which once stimulated the rapid historical growth; limited product differentiation in some cases, leading to lower switching costs and commoditization; and the dynamics of the global market, with migration of selective fabricated metal goods markets, primarily to the Asian region. Add to this the unprecedented increases in raw material costs in the last two years, giving a recipe for price erosion, reduced margins and from this the risk for key organizations to reconsider their investment plans, which is the essential component required to stimulate powder efficiency, competitiveness and further market development in the future. The European powder coatings market will continue to be eroded by further developments in Asia, Latin America and the Middle East. There is, however, still room for expansion in central and eastern Europe. Poland, Czech Republic and Hungary have been for several years the main countries to have benefited from the migration of western goods 6

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manufacturers to the region in order to capture the favourable cost benefits. Russia, in particular, will continue to deliver very strong future growth expansion. Currently, this demand is overwhelmingly supported from imported powder sources. Turkey will also play a part with its accelerated growth over the past five years, its eight percent share of the European market, and its position as an export hub into other European states. The share of powder in the industrial market is claimed to be around 12-15%, and much of this is biased to segments such as metal furniture, architectural, appliances and the general engineering sector. There are many end use applications where powder still remains a niche player compared to solvent and waterborne alternatives. To exploit these market opportunities will require a cooperative effort by raw material suppliers, powder producers and equipment providers to resolve the outstanding limitations of powder coatings. Further developments in: lower cure temperatures; improved application at higher rates; more frequent colour change requirements; and thinner coatings for cost in use advantage. Together with the inherent benefits of zero VOC emissions, recycling to give >95% usage; one coat finishing; plus the excellent physical and chemical properties, the above improvements would make powder a compelling alternative to liquid systems. The top five potential targets for powder are tabulated and their current market share is shown: wood finishes 2%; functional coatings 4%; coil coatings 1%; agricultural and construction 7% and plastics 1%. Article entitled “The European Powder Coating Market” by Jim Ridge, European Marketing Director, Rohm and Haas Company, published in European Coatings Journal, Feb 2007, 18-19

C OAT I N G S

EVENTS Nurnberg Congress 2007 The Nurnberg Congress and European Coatings Show will be held at the usual venue on 7-9 May 2007. In addition to the Congress and Exhibition, this year’s meeting will also include PreCongress Tutorials and a Delegates Pre-Congress Survey will be reported. Programme Monday 7 May 2007 08:30-12:00 Pre-Congress Tutorials I-III 10:30-12:00 Pre-Congress Tutorial IV 12:15-13:30 Plenary Session Welcome Address, Congress Introductions European Coatings Award Presentation of Delegates’ PreCongress Survey Keynote Presentation 14:00-17:30 Parallel Session I Science Today, Coatings Tomorrow Parallel Session II Licensing and Technology Transfer Parallel Session III Nanotechnology Parallel Session IV Powder Coatings Parallel Session V Measurement and Testing 17:00-19:00 Forum Technology Transfer Poster Session Tuesday 8 May 2007 09:00-12:30 Parallel Session VI Printing Inks I Parallel Session VII Adhesives & Sealants I Parallel Session VIII Construction Chemicals I Parallel Session IX Protective Coatings Parallel Session X Coatings for Plastics Parallel Session XI Waterborne Systems FEBRUARY 2007