Additives Market Update

Growth in Asia-Pacific is fueling global demand.

The global market size of coating additives is expected to reach $9.19 billion by 2021, according to market research firm MarketsandMarkets. Globally, the market as a whole is expected to register a CAGR of 6.1 percent during the forecast period. In recent years, researchers found that the Asia-Pacific region dominated the coating additives market in terms of both volume and value.

The increasing demand for the architecture, automobile, industrial, and wood, and furniture industries in China, India, and Japan is driving the coating additives market.

The report – titled Coating Additives Market by Function (Rheology Modifiers, Dispersing, Wetting Agent, Impact Modifier, Anti-Foaming), Application (Automotive, Architecture, Industrial), Formulation (Water, Solvent, Powder Based), and Types – Global Trends & Forecasts to 2021- found that rheology modification function will dominate the coating additives market through 2021. Used to impart optimal fluidity and functionality to the surface, rheology-modifying additives implemented to help better finishing of the coating surface, the report states.

“Waterborne formulations dominate the market among all the formulation types. With increasing environmental regulations, the market share of coating additives for the solvent-borne system is decreasing. The demand is shifting toward the waterborne and powder-based coating additives due to stringent environmental regulations.

However, solvent-borne is still being significantly used in Asia-Pacific and South America through its use has drastically reduced in Europe and North America,” researchers found.

“Architecture is the major application of coating additives. The growing commercial and residential construction in Asia-Pacific is driving the demand for coating additives for better protection of buildings.

In addition, the growing automotive sector in regions such as Asia-Pacific and South America is catalyzing the demand for high-performance coating additives.”
Taking a closer look at the American market, Grand View Research recently published a report – Americas Coating Additives Market Analysis By Formulation (Waterborne, solvent-borne, Powder), By Function (Rheology Modification, Biocide, Wetting & Dispersion, Antifoaming, Impact Modification, Flow, De-Waxing), By Product (Acrylic, Urethane, Fluoropolymers, Metallic, Alkoxylates), By End-Use (Automotive, Architecture, Industrial, Wood & Furniture) And Segment Forecast To 2024 – which determined that the American coatings additives market size exceeded $1.60 billion in 2015. A rapid expansion in the infrastructure and the automobile industries has led to significant demand for the protective enamels in the region.

Researchers found that the renovation and restoration of old architectures have gained momentum in most of the economies in the region over the past few years.

“Several new constructions and mega infrastructure projects have also been sanctioned over the past few years especially in the U.S., Canada, Brazil, and Argentina. This factor is anticipated to lead to a higher usage of coatings, thereby creating a sustained demand for the additives in the construction sector in the region,” the report stated.

“Countries including the U.S. and Canada are focusing on green construction since the past few years, and the trend is expected to continue in the near future. The industry has witnessed a shift in consumer trends regarding reducing reliance on petrochemical-based additives to moderate volatile organic contents (VOC) emissions.

This has led to a high rate of penetration of waterborne formulations across various architectural and industrial applications especially in mature economies of Canada and the U.S.”

Grand View Research found that the majority of these condiments are mostly derived from petrochemicals, except for some such as cellulose and vegetable oil. “The low crude oil prices from the last few years have positively impacted the market and will continue to be so till the prices get stabilized, researchers determined,” researchers stated.

New product and technologies innovation, such as the powder-based formulations and acrylic-based primers, is expected to penetrate the customer base in the near future. Technological advancements, moderate pricing, and diverse product portfolio are anticipated to be the major factors driving the industry over the foreseeable future.

Rising health awareness and the existence of inflexible policies over VOC content in the region have forced the formulators to either use additives that help reduce the content of volatile organic compounds or to shift to waterborne formulations.

“The high requirement for bio-degradable and environment-friendly coating additives with enhanced durability and performance is expected to drive the industry growth in the region,” researchers found.

“Constant innovations and development of bio-degradable agents with multiple functions are expected to remain one of the major buying criteria for these products. Additionally, long-term contracts with domestic suppliers or manufacturers may help in tackling volatile pricing and uninterrupted supply.”

Market growth, raw material costs

Echoing some of the aforementioned research findings, David S. Grabacki, president of Keim Additec Surface USA, said that “from our perspective and regarding the materials we are producing in our group, which include solid and water-based wax additives.

Also non-wax-based specialty coating additives, we see the coatings market in Europe at a stable level, while there is in North America and several Asian countries still an increasing demand for high-quality coatings additives.”

Shailesh Shah, Ph.D., global strategic marketing- formulation additives at BASF, believes that in 2016, the additives market grew globally with greater growth in water-based applications. He expects the modest growth to continue for 2017.

“Many of the same raw materials are found in resins, dispersions, and additives,” Shah said. “Since additives are not the main cost contributors in a coating, the market is not dependent on fluctuations in the raw material costs, but of growth of the underlying coatings market.”