Market situation and development trend of powder coatings industry in China

Powder coatings as a supporting industry of the national economy, its development speed and quality are closely related to the international and domestic economic environment, and the promulgation and implementation of relevant policies and regulations will seriously affect the development of powder coatings industry. In the first 30 years of reform and opening up, thanks to the great development of household appliances, housing, automobiles, infrastructure and other fields, as well as China's entry into WTO, the export of products has increased substantially. China's powder coatings industry has grown from scratch, from small to large, with an annual growth rate of more than 20%.

The financial crisis in 2008 has led to weak global market demand. Among the world's major economies, the United States has a weak economic growth, the economic performance of the eurozone is low, the Japanese economy has been weak for a long time, the growth rate of emerging economies has declined, and the growth rate of China's macroeconomic has also slowed down Online coatingol.com. Affected by this, the growth rate of powder coatings in China has also slowed down.

Environmental friendly coatings represent that the output of powder coatings in China has increased steadily< p> With the development of industry, environmental pollution problems have gradually become prominent. The large-scale and long-term fog and haze weather reflects the severity of air pollution in China from one aspect. The Party and the government attach great importance to this. In order to effectively control PM2.5, the former Ministry of Environmental Protection formulated the Action Plan for the Prevention and Control of Air Pollution and the "Ten Articles of the State". The Ministry of Ecology and Environment has also signed the "Target Responsibility Letter for Air Pollution Prevention and Control" with 31 provinces (districts and municipalities) in China to further implement the environmental protection responsibilities of local governments. Article 46 of the Law on the Prevention and Control of Air Pollution clearly stipulates that industrial painting enterprises shall use coatings with low VOC content. For furniture production, home decoration, automobile manufacturing, automobile repair, household appliances manufacturing and other industries, the government has strict requirements for the use of environmentally friendly coatings.

Therefore, as a representative of environmentally friendly coatings, powder coatings in China have performed well in recent years. The growth rate of powder coatings output in China is basically consistent with the growth rate of national GDP. According to the enterprise survey data, there are 3274 enterprises engaged in powder coatings related business in China in 2018. From 2011 to 2017, the output of powder coatings in China increased steadily. In 2017, the output of powder coatings in China reached 1.66 million tons, an increase of 7.10% over the same period last year. Prospective estimates show that the output of powder coatings in China will be about 1.76 million tons in 2018. The origin of powder coatings in China is concentrated in the Yangtze River Delta, the Pearl River Delta, the Bohai Sea Rim, the Yangtze River Delta and the Pearl River Delta, which have been the concentrated areas of powder coatings enterprises in China, and occupy the vast majority of the production and sales of powder coatings in China. Owing to the developed manufacturing industry, large economy, good business environment, high quality customer base and early environmental protection management, the output of powder coatings in these two areas has increased steadily in the past two years. The Bohai Rim area, which had a good momentum of development, was blocked because most of it was located in Beijing, Tianjin and Hebei, and was greatly impacted by environmental protection. The Yangtze River Delta includes Jiangsu, Shanghai, Zhejiang, Anhui and Jiangxi provinces, among which the larger powder enterprises are concentrated in Zhejiang, Anhui and Jiangsu provinces. Aksu Nobel, Huacai, Wenzhou Libang, Jade, Changming and other enterprises in Zhejiang Province; Aishi Dehua Jia, Meijia, Sanris and other enterprises in Anhui Province; Huaguang, Tiger and other enterprises in Jiangsu Province.

The Pearl River Delta region includes Guangdong, Fujian, Hunan, Guangxi and Hainan provinces, among which Guangdong Province has the highest density of large powder enterprises in all provinces and cities, including Aksub Nobel, Optimus, Huajiang, Wise, Defusheng and other enterprises; Wanan, Wanshun and other enterprises in Fujian Province.

Bohai Rim Region includes Beijing, Tianjin, Hebei, Shandong and Liaoning provinces and cities, among which the larger powder enterprises are concentrated in Beijing, Tianjin, Hebei and Shandong, Bond Hansen in Beijing, Lebanon and Xiangsheng in Tianjin, Meier in Shandong and other enterprises.

According to the data, in 2017, the output of the Yangtze River Delta area accounted for 45.6%, up 0.04 percentage points from 2016; the Pearl River Delta area accounted for 28.9%, equal to 2016; the Bohai Rim area was 18.5%, down 1.3 percentage points from 2016. The price fluctuation of raw materials upstream of Chinese powder coatings causes the price fluctuation of products to be larger. According to the preliminary results of the statistics of powder coatings industry in 2018 published by the Coatings Professional Committee of the Chinese Chemical Society and the National Coatings Industry Information Center. The data show that the average price of powder coatings in China increased by 118 yuan per ton in 2018. The average price of powder coatings in China in 2018 is 18.6 yuan/kg, which is far from the average price of powder coatings in the United States of America of 36-40 yuan/kg. In addition, the price of powder coatings in China fluctuates greatly. In addition to the fluctuation of raw material prices in the upstream and the impact of market changes in the downstream, low-quality and low-cost products are flooding the market, which is caused by irrational market competition, and the profit margin of powder coatings enterprises is limited.

Specifically, powder coatings industry has been known for its low threshold and serious product homogeneity. With the promotion of supply-side reform, stricter environmental protection law, limited production and shutdown of factories, increasing labor costs, rising logistics costs and other factors have brought tremendous cost pressure to powder coatings manufacturers. In the face of rising raw material prices, most of the key powder enterprises at home and abroad have announced price increases, but few of them have actually landed.

From the perspective of the industry as a whole, the performance of the industrial chain is obviously differentiated, and the price hike tide is obvious.