Frost & Sullivan Analyst Reports on Asia-Pacific Paint and Coatings Industry
SINGAPORE – The Asia-Pacific paint and coatings market is growing in line with the robust economic growth seen in the region. In 2008, the paint and coatings market in APAC was valued at $40.1 billion with a volume of 13.6 million tonnes. This makes up roughly 30-35 percent of the global paint industry.
In the last five years, the APAC paint market enjoyed a compounded annual growth rate (CAGR) of approximately 15 percent. However, effects of the economic slump hit the market in the second half of 2008 continuing into the first half of 2009. Industry players only started to see a positive rebound in late 2009.
Overall, in 2009, the market is estimated to have only recorded marginal growth. The negative growth seen in most countries has been buffered by the positive growth coming from China and India. Industry players are positive and confident in seeing positive growth numbers in 2010 and 2011.
According to Frost & Sullivan's Program Manager of Chemicals, Material and Food Practice Sheila Senathirajah, within ASEAN the two key hot spot markets are currently Vietnam and Indonesia. These countries have not been hit as hard as other ASEAN countries, due to a relatively lower share of advanced manufacturing, with growth stemming from domestic demand.
"The growths of Vietnam and Indonesia are expected to remain positive over the coming two years. These countries have begun to show high growth potential with double-digit growth rates and equally low domestic consumption. There is much opportunity in terms of volume sales in these countries," Senathirajah said.
On the other hand, industrial giants in Asia, Japan and Korea have not fared well during the economic crisis, having been severely hit due to their extensive global financial links. These are mature markets registering minimal growth within the marketplace. Sustained positive growth is only expected to reemerge in late 2010, once the external environment improves.
"Mature markets such as Australia, South Korea and Japan may have lower market growth but high paint consumption per capita, which indicates that it is a rather saturated market. Areas of opportunities in these countries lie in the form of high-value coatings exhibiting higher performance attributes or to be used in niche applications," said Senathirajah.
In terms of industry specifics, the market has been heavily impacted by the reduction in export demand from the West, which has particularly affected coatings serving the automotive, industrial furniture and white-goods production industries.
"New coating technology entering the market is also expected to play a positive role in driving the industry. The terms green chemistry, nanotechnology and smart coatings are the current buzz words and formulators are finding ways to couple these three technologies together to produce coatings that are not just environmentally friendly but also able to enhance sustainability," Senathirajah continued.
"The industry will face some challenges with the rising prices of raw materials as well as fiercer competition from small, backend players in Asia that operate at lower costs, placing much pressure on industry players in terms of margin squeeze. In the long run, competition from coating substitutes such as glass and steel is also expected to negatively impact the market," said Senathirajah.
In order to succeed in this evolving and thriving industry in APAC, industry players within the coatings market need to focus on some key success factors in order to succeed.
"Branding is becoming increasingly important with the increase in awareness amongst consumers. In China for example, local branding is fast becoming an essential marketing strategy to capitalize on increasing domestic demand," said Senathirajah.
Other key focus areas as identified by Senathirajah include innovation as customers are becoming more demanding and aware of paint and its attributes, pushing key players to distinguish themselves from the masses. Industry players also need to be aware of regulations affecting the industry not just at a local level but also at a regional and international level.
In the last five years, the APAC paint market enjoyed a compounded annual growth rate (CAGR) of approximately 15 percent. However, effects of the economic slump hit the market in the second half of 2008 continuing into the first half of 2009. Industry players only started to see a positive rebound in late 2009.
Overall, in 2009, the market is estimated to have only recorded marginal growth. The negative growth seen in most countries has been buffered by the positive growth coming from China and India. Industry players are positive and confident in seeing positive growth numbers in 2010 and 2011.
According to Frost & Sullivan's Program Manager of Chemicals, Material and Food Practice Sheila Senathirajah, within ASEAN the two key hot spot markets are currently Vietnam and Indonesia. These countries have not been hit as hard as other ASEAN countries, due to a relatively lower share of advanced manufacturing, with growth stemming from domestic demand.
"The growths of Vietnam and Indonesia are expected to remain positive over the coming two years. These countries have begun to show high growth potential with double-digit growth rates and equally low domestic consumption. There is much opportunity in terms of volume sales in these countries," Senathirajah said.
On the other hand, industrial giants in Asia, Japan and Korea have not fared well during the economic crisis, having been severely hit due to their extensive global financial links. These are mature markets registering minimal growth within the marketplace. Sustained positive growth is only expected to reemerge in late 2010, once the external environment improves.
"Mature markets such as Australia, South Korea and Japan may have lower market growth but high paint consumption per capita, which indicates that it is a rather saturated market. Areas of opportunities in these countries lie in the form of high-value coatings exhibiting higher performance attributes or to be used in niche applications," said Senathirajah.
In terms of industry specifics, the market has been heavily impacted by the reduction in export demand from the West, which has particularly affected coatings serving the automotive, industrial furniture and white-goods production industries.
"New coating technology entering the market is also expected to play a positive role in driving the industry. The terms green chemistry, nanotechnology and smart coatings are the current buzz words and formulators are finding ways to couple these three technologies together to produce coatings that are not just environmentally friendly but also able to enhance sustainability," Senathirajah continued.
"The industry will face some challenges with the rising prices of raw materials as well as fiercer competition from small, backend players in Asia that operate at lower costs, placing much pressure on industry players in terms of margin squeeze. In the long run, competition from coating substitutes such as glass and steel is also expected to negatively impact the market," said Senathirajah.
In order to succeed in this evolving and thriving industry in APAC, industry players within the coatings market need to focus on some key success factors in order to succeed.
"Branding is becoming increasingly important with the increase in awareness amongst consumers. In China for example, local branding is fast becoming an essential marketing strategy to capitalize on increasing domestic demand," said Senathirajah.
Other key focus areas as identified by Senathirajah include innovation as customers are becoming more demanding and aware of paint and its attributes, pushing key players to distinguish themselves from the masses. Industry players also need to be aware of regulations affecting the industry not just at a local level but also at a regional and international level.
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Global Paints and Coatings Industry Growth ..
July 8, 2014
Looking Very Wast growth in Asia-Pacific market For paint and coatingsBy Frost.I Have read my company report "
Global Paints and Coatings Market is Expected to Reach USD 143.9 Billion in 2019: Transparency Market Research
http://goo.gl/rCz2Tj
