Asia Pacific market for coating resins is fragmented to a great extent owing to a copious number of medium- and large-scale manufacturers. The market is characterized by stiff competition and limited profit margins which makes it tough for small-scale players to survive. The top eight companies in the region account for well over half the share in the market.
Despite the unsustainable profit margins deterring smaller companies, new opportunities are opening up in the market with upcoming green technologies meant to comply with the stringent environment protection laws. Hence, players are seen focusing on product innovation and leveraging waterborne technologies.
A report by Transparency Market Research on the Asia Pacific market for coating resins predicts it to rise at a steady CAGR of 5.9% between 2015 and 2023. At this pace, the market which was worth US$4.3 bn in 2014, is expected to pull in a value of US$7.2 bn by end of 2023.
The building and construction industry is mainly serving to drive demand in the Asia Pacific market for coating resins. The end use segment’s total market share vis-à-vis volume came to a substantial 38.2% in 2014. Geographically, China currently accounts for most of the share in the market and going forward too is expected to retain its dominant share. In 2014, its leading share came to a massive 59.5%. This is because, the widespread industrialization and resultant urbanization in the nation has not just made it a key manufacturer but also a key consumer. Its large population has also benefitted its market.
Spike in Construction Activities Catalyzes Growth
Majorly fuelling the Asia Pacific market for coatings resins is the burgeoning construction activities in the region. This is mainly on account of the presence of many fast expanding large economies in the region. Most notable among them is India and China, large nations which are home to about two third of the world population. The growing pace of industrialization and urbanization in the two nations and also the thrust on infrastructure building has boosted demand for coatings resin. Another factor majorly impacting demand in the region is the surging sales of automobiles owing to rising disposable incomes of people. Coatings resins also find usage in automobiles. Other application areas propping up the market growth are electronics and furniture.
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Unstable Raw Material Prices Hamper Market
Posing a challenge to the market on the other hand is the volatility in conventional raw material prices, which in turn is affecting production. This is because they are derived from petrochemicals. This results in increased prices thus affecting demand. Adds the lead analyst of our TMR report, “Strong demand for most of these raw materials in a range of industries not just affects the cost stability but also supply. Further, strict regulations pertaining to emission can deter sales of a range of polluting products in the near term.”