Coating Additives Market Forecast, Trend Analysis & Competition Tracking - Global Market Insights 2019 to 2027

Green Building Trend Shaping Coating Additives Market

Coating additives are increasingly required to comply by zero-VOC emission norms. Governments worldwide are upping the ante and stepping up efforts to reduce carbon emissions from construction activities. This has led to a profound, rapid transition and is supporting the growth of the coating additives market which is all set to witness an average annual growth of around 4% during the long-term forecast period of 2019-2029.

The emergence of green coatings is moving the coating additives market into a new phase of development. In the years to come, the use of green coatings is expected to be more popular within the automotive industry, which is helping the value-pool growth prospects of the coating additives market.

Stringent Government Regulations Ushering in Eco-friendly Additives

Stringent regulatory policies pertaining to VOC emissions and Hazardous Air Pollutants (HAPs) have had a substantial influence on coatings markets at a global scale. Regulatory bodies such as European Environment Agency (EEA) and the EPA (Environment Protection Agency) mandate limitation of volatile organic compounds (VOCs) content in coatings. On 11 September 1998, The Environmental Protection Agency published the architectural coatings rule (63 FR 48848) under the authority of Section 183(e) of the Clean Air Act. This has, in turn, led manufacturers of coatings to focus on enhancing product performance and exploring opportunities to introduce new VOC-free products in the market.

Manufacturers are increasingly focusing on enhancing performance of coatings and introducing multi-functional and hybrid coatings as well as innovative eco-friendly products such as green coatings, nano-coatings, etc. These innovations in turn would enable manufacturers to adapt to new regulatory dynamics. Moreover, these innovations are likely to be application-specific which will further widen the customer pool in the coating additives market.

Rheology Modifiers to Enhance Coatings Formulations Leveraging Market Growth

Rheology modifiers are predominantly used in architectural and automotive applications. They are used to control flow viscosity, which is one of the most essential properties of coating compositions, and amend fundamental aspects such as storage stability, soft-texture, and film thicknesses. The demand for rheology additives is on the rise as coating manufacturers are channelizing their focus towards improving the quality of their coatings. A notable example would be to make coatings highly viscous, improve textural properties, and enhance shelf life.

As the flow behavior of coating compositions has a huge impact on application and film formation, the demand for rheology additives is expected to increase by a remarkable margin. Moreover, architectural coatings, a prominent application of coating additives, require rheology modifiers in coatings formulations due to the soaring demand for soft-texture coatings.

 Bio-based and Eco-Friendly Coatings to Pave the Path for Improved Returns

Increasing levels of emission of hazardous air pollutants (HAPs) and volatile organic compounds (VOCs) from conventional coatings give rise to concerns regarding environmental degradation. Governments in most countries are restricting the use of toxic and environment-degrading coatings. With the enactment of stricter laws and regulations to curb air pollution caused due to hazardous emissions, conventional coatings are likely to be replaced soon by bio-based coatings. Conforming to stringent environment regulations, coating additives manufacturers have started investing in development of bio-based and environment-friendly coating additives. For instance,

• Elementis plc, a global specialty chemicals company, offers Thixatrol, an environment-friendly coating additive.
• Akzonobel Specialty Chemicals (Nouryon) and Renmatix, Inc., global leaders in plant-based technology, will jointly develop bio-based performance coatings to improve the properties of architectural coatings.

Frontrunners Hold 45-50% Share as Capacity Expansion and Innovation Remain Key Market Imperatives

The coating additives market remains consolidated, with relatively high barriers for new entrants. The tier 1 players such as Ashland Inc., BYK-Chemie GmbH (Altana), The Dow Chemical Company, Elementis plc, Evonik Industries AG together hold around 45-50% revenue share and are focused towards expanding their regional footprints and strengthening their product portfolios. Furthermore, stringent government regulations for the development of eco-friendly and sustainable coating additives will continue to play a vital role in the coating additives market throughout the forecast period. This has led manufacturers to invest heavily in developing volatile organic compounds (VOC) exempted, bio-based and multi-functional coating additives.

Key coating additive manufacturers are developing innovative products and are expanding their geographical reach to cater to the growing demand for functional additives. Furthermore, they are also entering into a long-term supply contracts with raw material suppliers and end-users to have a strong presence in the worldwide market. Some of the current significant developments in the market include:

• In 2019, Ashland Inc. a specialty chemicals company, added Strodex PK-86NV specialty phosphate ester surfactant to its dynamic product portfolio for waterborne architectural coatings.
• In 2019, BYK-Chemie GmbH (Altana), a specialty chemicals company, announced the expansion of BYK’s specialty chemicals division in Shanghai, China. This expansion enables the company to serve consumers in the fast growing Asian markets.
• In 2019, BASF introduced Hydropalat WE 3225, a new silicone wetting agent in its product portfolio. This new product combines excellent substrate wetting agents with pronounced defoaming performance. The company also launched Dispex Ultra PX 4290, a new high molecular weight dispersing agent, which opens up a plethora of opportunities in broad applications such as automotive OEM & refinish coatings, industrial coatings, and wood coatings.
• In 2019, Daikin Industries Ltd., a leading producer of fluoropolymer products announced the establishment of a new subsidiary in Jiangsu Province, China for the sales and manufacturing of fluorochemical products.

New entrants and emerging companies in the coating additives market are also involved in product innovation, expansion of product portfolio, and collaborations with industry giants and end users to capture as much visibility as possible.

The Nimble Prosper – Regional Markets Going Strong with Sustainability

Regional trends and regulatory policies have a huge impact on the development of the global coating additives market. Currently East Asia holds a prominent share in the global coating additives market. China, which strives towards self-sufficiency, has witnessed higher growth in the global coating additives market. Major R&D investments, expansion of production facilities, and rise in architectural development in the country has further boosted the sales of coating additives.

Europe holds the second-largest share in the global market. The prime focus of European manufacturers is on developing eco-friendly products without compromising on performance and quality, mainly due to the stringent regulations levied by the European Environment Agency (EEA) in the region. Moreover, presence of key stakeholders in the region and rising demand for high performance coatings further amplifies the demand for coating additives. In North America, coating additives manufacturers are investing heavily to produce water-borne formulations with low VOC (Volatile Organic Compound) content due to the stringent regulatory policies such as the Clean Air Act enacted by U.S. federal governments. Expansion in manufacturing facilities is anticipated in Latin America owing to the massive infrastructural growth and developing automotive industry in Mexico. The coating additives market has witnessed a standstill in the Middle East & Africa due to socio-economic instability and low consumer awareness about the benefits of environment-friendly coating technologies.