Coatings World - August 2016

Kerry Pianoforte, Editor

The high performance pigments market is posed for steady growth worldwide, according to the Smithers Rapra re- port, “The Future of High-Performance Pigments to 2021.” Analysts anticipate a global volume market of 178,844 tons in 2016, with an overall value of $4.76 billion. Across the next five years, Smithers Rapra predicts the market for high performance pigments (HPP) will accelerate steadily at a compound annual growth rate (CAGR) of 3 percent, reaching 206,921 tons in 2021 – at this time world market value will be $5.49 billion.

According to the Smithers Rapra report, with a 54 percent market share, coatings remain the most significant end-use for HPPs, followed by plastics, inks and cosmetics, respectively. The fastest developing end-use segment is textiles, although it will remain at approximately 2 percent of global consumption across the Smithers study period. In terms of volume consumption, metallic pigments comprise 43 percent of the 2016 market – with consumption pronounced particularly in Europe – followed by pearlescent and organic HPPs.

The market is evolving against a backdrop of dynamics,
some of which are common to pigment supply industry world-
wide, and some that are unique to the high-performance seg-
ment. Smithers Rapra’s analysis identifies the following as the
leading six across the next five years:
• Wider economic context: The HPP sector will need to nego-
tiate the same economic mega-trends as the wider ink industry,
low petroleum prices, prospects of a slowdown in growth in
China, and – the as yet – undefined fallout from the UK’s deci-
sion to leave the European Union.

Market expansion will be fastest in Asia – already the world’s largest regional market. In contrast growth in the second largest region, Europe will be significantly below the market average, with consumption in North America tracking the global CAGR.

• Legislative phase-outs: With the dangers of lead-based
paints well known, steps to further phase-out this class of
pigments will continue. This situation is well advanced in the
developed world.

Through the years 2016-2021 there will be a shift towards greater restriction in developing economies. This will be spearheaded by initiates like the World Health Organization’s International Lead Poisoning Prevention Week, and will lead to further market penetration of organic high-performance yellows and oranges and bismuth vanadate.

More sustainable HPPs are a future growth area, tracking wider trends in the chemicals sector. In particular this will see the evolution of more performance pigments whose production involve low or very low emissions of volatile organic compounds (VOCs) – a step supported by new regulatory programs.

The reduction of VOC emissions is being achieved by moving to waterborne coatings and powder coatings. This requires different pigment formulations – especially dispersion technologies – from those appropriate for solvent-borne applications, and requires new investment in many cases.

• Environmental interest: Pigment end users and consumers are also increasingly keen on less environmentally damaging pigment technologies that do not sacrifice color quality. This is manifesting in new product launches like Axalta Coating Systems’ new automotive tint line engineered for the Chinese market. Flexo ink users are also responding positively to the arrival of heavy metal-free ink sets and Smithers predicts further penetration across the next five years.

• Chinese policy to push ingredient prices: Raw material prices for HPPs stabilied somewhat during 2015, although in 2016 these remain high. Supply of pigment intermediates – particularly those used to produce reds and yellows – is a continued concern. Many of these materials are produced in China, and the Chinese government’s continued efforts to clean up its environment have resulted in factory closures, which has restricted output.