International Coatings Scene
LATIN AMERICA
BY CHARLES W. THURSTON
LATIN AMERICAN CORRESPONDENT
THURSTONCW@RODPUB.COM
Peru’s paint industry outstrips
expectations
As Peru’s
economy
continues to
show healthy
growth, so
too does the
country’s
paint and
coatings
industry.
Peru’s paint and coatings industry is growing much faster than predicted at 20%
this year, driven by a spike in construction sector demand and by the projected eight
percent expansion of the overall economy. In
February, aggregated paint industry manufacturing expanded by 47.9%, according to the
Banco Central de Reserva Del Peru, in Lima.
Over the last few years, the $130 million
Peruvian paint and coatings market, which
produces approximately 14 million gallons per
year, has grown between 15% and 20%, according to Erik Holmquist, commercial manager of
Industrias Venecedor S.A., a Lima-based paint
and coatings manufacturer.
New construction is moving almost as fast as
the paint market it is driving. The construction
sector grew 22.5% in February, reflecting the
increase seen in the construction of homes,
offices, commercial and industrial facilities, as
well as the construction of mining and energy
projects, the central bank reported recently.
The jump in overall economic activity in
February was the largest since 1995, according
to the national statistics institute.
This construction boom should have positive
effects on major players in the Peruvian paint
market, including local manufacturers like
Vencedor, which holds a professed 30% share of
the market, as well as global leaders with a
strong presence, like Sherwin-Williams. The
demand, which is being led by the architectural segment, also should help raise the Peruvian
per capita paint consumption, which is now
only 0.3 gallons per year. Thus far, inflation
control is roughly on track to meet the Central
Bank’s goal of two percent in 2008, so price
increases should not dampen new demand.
“This year the architectural segment is growing at approximately 30%,” said Simon Tavara,
export manager for Vencedor, in Lima.
Vencedor, which has been in the industry for
more than 60 years, is now majority owned by
Chile’s Tricolor. Vencedor produces latex-based
paints, enamels, lacquer and varnishes, and
anti-corrosives in liquid and/or powder formulations. The company operates a retail store
network, Colorcentro, which features a color
mixing system, Sistema Tintometrico Galaxy.
The company also has warehouses in Trujillo,
Piura, Talara and Arequipa. It exports its products to the Andean region, Central America and
South America; within its home region, Bolivia,
Chile, Ecuador and Venezuela are key buyers.
Among recent product launches, Vencedor is
now offering Vencesatín, a premium latex in a
satin finish; the company markets its products
as “Class A.” The company also has begun offering its Supermate, Vencelátex, Rocky and Dar
Color product lines in 2.5-gallon plastic tubs.
While the architectural segment is growing
fastest in Peru, the industrial segment demand
also is slated to rise quickly thanks to a host of
new investments, which have followed the recent
signing of the U.S.-Peru Free Trade Agreement.
Among large new projects, Dubai Ports World
is building a container terminal within the port
of El Callao, with an initial investment of more
than $300 million. The Inter-American
Development Bank also will lend more than
$350 million to Peru over the next five years for
the development of sanitation and water projects, which will benefit more than 100,000 families. And Maple Energy, which is developing
gas projects in the interior of the country has
also begun to develop a $157 million ethanol
project, with plans to export to California.
At the same time, the government is requiring
that the mining industry—the country’s largest
industry—spend more on infrastructure, which
will improve workers’ lives, according to Finance
Minister Luis Carranza Ugarte. Such investments should bode well for both the housing and
industrial coatings segments in Peru. CW
