|Global market for adhesives is estimated to reach US$38 bln and sealants to reach US$6.5 bln by 2017, according to a report by Global Industry Analysts, Inc. Growth in the market over the next few years will be driven by growing product penetration in new application markets, product differentiation and innovations. Robust demand from developing markets, particularly Asia-Pacific, also augurs well for the market. Adhesives and Sealants are of great use across innumerable industrial and commercial applications. Given its high strung sensitivity to key end-use industries such as packaging, automotive, electronics, footwear, construction repair and remodeling, textiles, consumer goods, and shipbuilding, all of which succumbed to the recent economic recession led slowdown, the global market for adhesives and sealants too suffered significant declines in volume and value sales during the period. Decrease in consumer spending, declines in manufacturing output and volatility in raw material costs witnessed during this period especially affected demand for adhesives and sealants during 2008 and 2009. Construction, automotive, electronics and wood-working adhesive end-use witnessed the steepest declines, while packaging and disposable adhesives fared better. While steep deceleration in housing demand, decline in new house starts, sharp fall in number of applications for building permits and subsequent fall in construction activity squeezed market prospects for adhesives and sealants in the construction sector, the hurting fall in new vehicle sales and the resultant production cutbacks, plant closures, capacity idling, and scaling back of operating capacity reduced opportunities for adhesives and sealants in the automotive space.
The global adhesives and sealants market however staged a comeback in the year 2010 witnessing growth in both volume and dollar sales during the year. Innovation and product differentiation based on next generation technology, which assumed critical importance during difficult economic conditions will continue to drive growth in the market over the next few years. Next-generation technologies such as new VOC compliant adhesives and green adhesive and sealants, which made remarkable market entry in recent years, will continue to garner attention and demand from key end-use sectors, given the need for these industries to comply with industrial emissions, water and waste-water concentration and other environmental regulations. Constant pressure on adhesive prices especially throws the spotlight on product differentiation on the basis of formulation and technology. Companies will continue to focus on quality, technology, service, customization, worker safety, environmental improvement, and use of flexible formulations to differentiate their products. The market will also be driven by growing penetration of adhesives and sealants in new application areas. Medical adhesives and sealants, for instance, are rapidly finding practical usage in newer application areas such as dental and surgical procedures, thereby driving growth in the overall market both in terms of volume and value sales. Specialty adhesives and sealants designed for specific consumer needs in niche markets are also fast gaining traction, thereby boosting market prospects further for the global market. Europe represents the largest regional market for adhesives, both by volume and value sales. Asia-Pacific represents the fastest growing regional market for adhesives with volume sales from the region waxing at a CAGR of about 4.6% during the analysis period. Asia-Pacific is also the fastest growing regional market for sealants. Growth in the Asia-Pacific adhesives and sealants market is primarily led by China, given the infrastructure development investments and growing number of construction projects in the nation. By chemical type, Styrene Butadiene Rubber Adhesives is the fastest growing product segment, by volume sales in the adhesives category, while Latex Sealants is the fastest growing product segment by volume sales in the sealants category.
Major players in the marketplace include 3M Company, Acucote Inc., Adhesives Research Inc., AkzoNobel Chemicals B.V., Ashland, Inc., Avery Dennison Corporation, BASF SE, Bayer MaterialScience AG, Beardow and Adams (Adhesives) Ltd., Bolton Group, Bostik Inc., Chemence Ltd., Collano AG, Creative Materials Inc., DIC Corporation, The Dow Chemical Company, DYMAX Corporation, Dynea International Oy, ExxonMobil Chemical Company, Ferro Corporation, Franklin International Inc., H.B. Fuller Company, Henkel Corporation, Huntsman Polyurethanes, ITW Performance Polymers Consumer Division, Konishi Co., Ltd., LORD Corporation, MACtac, Mapei S.p.A., Momentive, PPG Aerospace, RPM International, Inc., Sartomer Company, Inc., Scapa Group Plc., Shurtape Technologies, LLC, Sika AG, Super Glue Corporation, Tesa AG, United Resin Corporation, Wisdom Adhesives Company, among others.
Global market for sealants is estimated to reach US$7,599.5 mln by 2016 as per Markets and Markets. Adhesives and sealants are the most versatile bonding agents available today. Although adhesives and sealants resemble each other chemically, they vary in their functionally; and they also have a similar technology base. The adhesives segment dominates the global adhesives and sealants market, with a share of almost 75%. Adhesives dominated the market in terms of both market share as well as innovations. Sealants segment accounts for 25% of the global adhesives and sealants market. With the huge market potential and the growing preference, the market for adhesives and sealants is likely to witness considerable growth. The growth of the market is also largely attributed to the technological developments. Asia-Pacific region dominated the adhesives and sealants market both in terms of volume and revenue. Adhesives and sealants can be further classified on the basic of product types, such as polyurethane, epoxy, silicone, styrenic block, ethylene vinyl acetate, acrylate, polyvinyl, and others. In terms of end-user or applications, adhesives and sealants are widely used in pressure sensitive products, automotive, packaging, construction, woodworking and furniture, and other products. Adhesives can also be categorized on the basis of technology employed in the production such as water-borne, solvent-borne, reactive, and hot melt. The global adhesives and sealants market is driven by many factors such as its broad spectrum of applications in different industries. The market size has also increased due to the growing demand for adhesives and sealants in Asia-Pacific. The ever increasing need for high standard performance across all modern applications is driving the growth of adhesives and sealants. On account of new technological developments, more niche applications for adhesives and sealants are being explored for meeting consumer's demand, this has also presented new opportunities to manufacturers and also helped in increasing the penetration of adhesives and sealants in new applications. However, growing volatility in the prices of raw materials has increased pressure on margins of adhesives and sealants manufacturers. The constant push from regulatory authorities such as EPA (Environmental Protection Agency) and REACH (Registration, Evaluation, Authorization, and Restriction of Chemicals) is likely to limit the use of solvent-borne adhesives and sealants in order to reduce the impact on the environment. One of the critical success factors (CSFs) in the adhesives and sealants market is product innovation. The winners in this industry will not be those that only try to reduce the costs of adhesives or sealants, but those who continually innovate in all aspects of their operations and strive to find newer, better, and faster products that will dramatically influence the cost-effectiveness of customers' operations.
The Adhesive and Sealant Council expects the Asia Pacific region total adhesive and sealant demand to grow 3.6% annually through 2013, reaching 9.9 bln lbs of wet formulated product. The market currently stands at 8.9 bln lbs of wet formulated product, with an estimated market value of approximately US$12.5 bln. Because of its strong, growing middle class, the entire region is a considerable market for products that use adhesives and sealants, including packaging, construction and transportation. Outside of Japan, which continues to feel the impact of the earthquake and tsunami all of the market is expected to expand and increase the use of innovative adhesive and sealant products over the next three years. Market forces impacting the region include: Global economic slowdown, rising raw material prices, weak U.S. dollar, Japan earthquake and tsunami, China and India growth, automotive production, raw material shortages, alternative energy demand, growing consumer class, growing environmental awareness. Even with some market drivers having a negative impact in the short term, the strong consumer demand and growing population will make this region a strong player in the years ahead. For adhesives alone, the estimated 2010 market stands at US$10.9 bln with 8.1 bln lbs of wet formulated product being shipped in 2010. The annual growth rate is 3.7% for adhesives. Sealants are projected to grow at 2.7% with an estimated 2010 value of US$1.5 bln and demand of 825 mln lbs.