Coatings World - January 2015

Catherine Diamond, Associate Editor

The pigments market has been steadily – however slowly – recovering since the economic downturn. Raw mate- rial prices, once extremely unstable, have become more consistent. A revitalized automotive market has provided a big boost for pigments suppliers, and 2015 is expected to be at least as strong as 2014.

According to Ahmed Tahir, industry marketing manager, Transportation and Industrial Coatings and Pigments for Plastics, BASF Corp., the pigment market benefited from the rebound in the auto market in 2014, with light vehicle builds approaching record levels with continued interest in differentiated effects.

“The industrial coatings market also showed an improvement
in 2014,” he said. “The housing market continued its uneven and
slow recovery in 2014. For 2015, we expect a similar trend, albeit
with a smaller growth for automotive and industrial sectors.”
Competition remains stiff for the pigments market, and in-
dustry experts expect that to stay true in the coming year.

“Sun Chemical Performance Pigments continued to see a positive upswing in the global pigments market in 2014, especially in the high performance and special effect pigments markets,” said Michael T. Venturini, global marketing manager Coatings, Performance Pigments, Sun Chemical.

He added, “Sun Chemical increasingly sees the supplier base becoming more global as regional suppliers enter other regions and markets. The competitive pressure, however, tends to give rise to regional requirements as producers respond to local needs and requirements.

“We expect an increased focus on technical service, quality,
performance and environmental considerations. We are always
looking to other pigment markets, global technology and con-
sumer trends that influence pigment consumption. The trends
can be driven both by legislation and the end consumer.”
Gary Wulf, VP operations and general manager at Sincol USA,
said that the pigments market grew in 2014 because of “the gen-
eral stabilization of the global economy.” Pigment consumption,
he said, is a reflection of increased consumer demand.

“We expect the climate for pigment consumption in 2015 to
continue to expand with the general health of the global econ-
omy,” Wulf said. “For Sincol in particular, we expect growth to
exceed the general growth of the economy due to our emphasis
on development of higher performance pigments demanded by
the paint and coatings markets. Our investment in pollution
control will see dividends as well with the closure of more pig-
ment manufacturing plants in both China and India.”

What to Expect in 2015

Given the scope of the pigments market, it is strongly influenced by economic, environmental and at times, political factors. According to Falko Orlowski, executive vice president of sales and marketing at Trust Chem USA, most pigment relevant intermediates by now are produced in China.

“As the Chinese government is increasingly paying attention
to environmental protection, it is becoming more difficult to pre-
dict cost,” he said. “There are an increasing number of temporary
shutdowns, creating a challenge for all manufacturers who will
have to plan accordingly and ensure proper supply lines.”
Sincol’s Wulf said that consolidation of both pigment manu-
facturers and pigment intermediate manufacturers is having a
significant impact on the pigment market.

“Those who have invested in the infrastructure and intellectual property to meet environmental and regulatory demand will be the long term survivors,” Wulf said. “There have been instances this past year where competition between intermediate suppliers was reduced with the closure of plants as a result of environmental compliance. This caused some dramatic fluctuations in raw material costs and resultant pigment costs. The decline in commercial publication has impacted pigment demand for this segment with pigment manufacturers needing to refocus on other markets.”

Wulf said that the developed markets of North America, the European Union and Japan will increase at the rate of the general economic recovery. “It is the demand of consumer consumption in the developing parts of the world that will yield the greatest growth,” he said. “As a middle class develops and grows, so will the demand for consumable products that have pigmentation.”

Venturini of Sun Chemical said that he expected to continue seeing demand for pigments with unique performance properties that are tailored specially for the end user’s application, such as stability/flocculation resistance in zero VOC systems,