Chinese polymers hit US$2.29bn in 2005
Due to increasing government emphasis on energy conservation and environmental issuesChina’s emulsion polymers markets are witnessing growthas emulsion polymers are environment-friendly and result in lower emissions than many alternatives.
Frost & Sullivan finds that the Chinese Emulsion Polymers Markets earned revenues of US$2.29 billion in 2005 and estimates this to reach US$4.77 billion in 2012.
“The Chinese government has recently released its strategic guidelines to build up a sustainable and harmonious society”notes Frost & Sullivan Research Analyst Ms Louise Zhao. “Countrywidethe importance of energy-saving and environmental protection is being stressed upon and the government is imposing stringent criteria for the same.”
The strategic policy of the government guides the country’s industries in developing principles of energy saving and recycling of resources and is likely to promote significant market expansion. As a resultthe potential application of emulsion polymers in adhesives and sealantspaints/coatings and inksand in building and constructionespecially in exterior insulation and finish systems (EIFS)appears promising.
Apart from thisrising awareness of volatile organic compound (VOC) issues among citizens is contributing to growing health concerns and the need for environmental protection. This is reflected in their consumption activities in several applications. Thusin the futurecustomer preferences are likely to result in increased use of emulsion polymers.
Meanwhileemulsion polymer suppliers are eagerly exploring potential business opportunities that offer the possibility of substituting traditional solvent-based products in order to achieve market success.
Despite positive trendsmarket participants are encountering the critical challenge of spiralling raw material costs due to the global crude oil issues. Shrinking industrial profits pose a restraint to commodity suppliers in the general-purpose product sector. Howevercertain niche markets with specialty products continue to offer profit potential.
“All participants are witnessing increasing raw material costs and intensifying competition” states Ms Zhao.
On the other handdisordered competitionprice war and intellectual property rights (IPR) violation are major challenges threatening the presence of multinational companies (MNCs) in the specialty products sector. Ultimatelycore competence in technology will determine profit margins.
In the context of domestic participantstechnological innovationwhich requires constant research and development (R&D) and significant capital investmentswill become crucial. In additioncustomised product innovationreinforcement in market exploration and developmentas well as optimised cost control will be essential. Logistics infrastructure and after-sales service are other critical factors imperative to promote market expansion.
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