Peru’s demand
for architectural
paints should
rise on increased
demand by
homeowners
and from new
construction.
Election Underscores Peru Growth Outlook
by Charles W. Thurston
Latin America Correspondent
thurstoncw@rodmanmedia.com
Peru’s recent presidential election has re- established a firm market-oriented future for the rapidly growing country. Pedro
Pablo Kuczynski is expected to foster continued
growth in mining, oil and gas, as well as the infrastructure and housing construction markets,
boding well for paints and coatings demand.
The nation of 31 million-plus is considered an upper-middle class economy by the
World Bank, and the gross national product
per capita of over $11,000 is similar to that
in Colombia, but trails the Brazil figure. GDP
expansion this year is widely forecast to be 4.0
percent, and Peru’s central bank has forecast
4. 6 percent in 2017.
The demand for architectural paints should
rise on increased domestic demand by homeowners and from new construction. The government has plans to build some 244,000
homes, to help alleviate the housing crisis. In
the commercial construction segment, STR reports that 1,064 rooms in nine hotels are being
constructed in Peru, which has a long history of
tourism growth.
Among new entrants to the architectural
market is Chile’s Pinturas Ceresita, which is
now being manufactured in Peru. A company
official was recently quoted by a Lima publication suggesting that the Peruvian paint market
is now worth $350 million, with per capita consumption of 1.3 gallons.
Apart from strong sales for paint manufacturers with company stores, like Sherwin-Williams, DIY big box sales are climbing.
Ceresita will be sold through the Sodimac
chain. Pinturas Vencedor, which has claimed to
be the third largest in the Peruvian architectural
segment, also is sold through Sodimac stores.
Vencedor, now owned by Qroma Color y
Proteccion, has sister paint companies in Peru
including: American Colors; CPP; Tekno; Fast;
Paracas; Jet; Uniquímica; Teknoquímica and
Abralit. Among these brands, CPP is being re-
cast as a highly durable product under a new
marketing campaign. Similarly, American Color,
a premium brand, has recently launched a mo-
bile phone site and a social media campaign.
Industrial paint demand will continue to
climb with new infrastructure projects. In the
oil and gas sector, the $4 billion southern gas
pipeline (GSP) is being constructed by a joint
venture including Brazilian construction firm
Odebrecht, Spanish utility Enagas and Peruvian
builder Grana y Montero. The pipeline will feed
two thermal electrical generation plants under
construction and plans are underway for petrochemical plants as well.
Industrial paint manufacturers like PeruPaint
will expand with new infrastructure projects,
adding to its portfolio of iconic structures like
the National Stadium. Other suppliers to the industrial segment include Germany’s Eckart and
U. S.-based Armorthane. Armorthane executives
recently toured Peru with a Missouri State trade
promotion group to encourage greater exports
to Peru, particularly in the mining sector.
Mining is the other main stay in the
Peruvian economy, accounted for 14 percent of
the country’s GDP in 2014, when mineral exports yielded $16 billion. Peru holds 22 percent
of the world’s silver reserves and 13 percent of
the world’s copper reserves, according to Ernst
& Young’s Peru’s Mining & Metals Investment
Guide 2015/2016. CW
