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Paint and Coating Market Reports

Double-Digit Growth for Chinese Coatings Market

Market Forecasts
March 25, 2012

LONDON - IRL has announced the publication of the sixth edition of its popular report A Profile of the Chinese Paint Industry. The report fully updates IRL’s previous study released in 2009 and includes all the latest industry trends and up-to-date statistics. 

Chinese paints and coatings consumption reached just over 11 million tonnes in 2011, of which architectural coatings occupied over a third of the market. This dynamic market has continued its growth trajectory despite the global economic recession by focusing on domestic market demand in the construction, automotive, and home appliances and consumer electronics sectors. 

Hosting key events, such as the Beijing Olympic Games in 2008, Shanghai World Expo in 2010 and Guangzhou Asian Games in 2010, China has stimulated huge amounts of investment in the country’s infrastructure. Indeed, China has continued to invest in infrastructure development, including new bridges, landmark city buildings, alternative-energy facilities, nuclear generation plants, schools and hospitals. 

These factors have all contributed to double-digit growth in the Chinese coatings market year on year since 2002, with the exception of 2008. Over the next five years, market growth is expected to remain at a level of around 10 percent per year, with the fastest growth being achieved in road-marking paints, coatings for plastics, automotive refinishes and protective coatings. These booming sectors will compensate for considerably slower growth in automotive OEM coatings and wood coatings. 

Per capita paint consumption remains relatively low in China at approximately 7.2 kg, indicating that there is still considerable potential for the market to grow further and penetrate into the more underdeveloped regions of China. 

The Chinese coatings industry continues to be highly fragmented, with as many as 20,000 manufacturers active in the market, albeit on a very small scale for many. Future consolidation is highly likely, as smaller players get pushed out through environmental pressures and demand for more high-quality products from the end-users. 

The key opportunities for future growth in the market will arise from a number of factors. The 18th Congress of the CCP (Chinese Communist Party) will be held in October 2012, and there will be pressure on the new leadership team to introduce measures to stimulate the economy after many government incentives were pulled in 2011. The Chinese government’s affordable housing program plans to build 36 million new affordable dwellings over the next five years. With huge regional disparities remaining in China, rural areas will offer opportunities for infrastructural development and as yet untapped consumer demand. Rising car ownership, poor road conditions and a very low scrap rate will all boost demand for automotive refinishes. The Chinese end-user industries will be looking for coatings offering environmental benefits and safety features (like lead-free, VOC-free, formaldehyde-free etc.), plus more functionality, in order to meet stricter standards (particularly for products destined for export) and serve the needs of discerning consumers (especially the younger generations). Additionally, offshore engineering schemes and infrastructure development will bolster sales of marine and protective coatings. 

For additional information about the report, visit www.informationresearch.co.uk.

KEYWORDS: Asia

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