Market overview for water borne coatings

Globally, the lion’s share is attributable to the Asia-Pacific region. The region accounts for a good half of the volume (17.28 million tons) and about 43 % of the value. Europe ranks second with just under 7 million tons worth EUR 21.5 billion. For North America, the market researchers determined a volume of 6.1 million tons and a value of EUR 19.5 billion. For South America, MaM estimates the volume at 2.44 million tons and around EUR 6.7 billion. A similar order of magnitude results for the Middle East and Africa region, 2.12 million tons and a value of EUR 5.9 billion. They expect further growth in the coming years. The global compound annual growth rate (CAGR) is 4.9 % through 2026, according to MaM. The highest growth, with a CAGR of 6.6 %, is expected in Asia-Pacific. The Middle East and Africa region is just below the global average at 4.5 %. In Europe, the figure is expected to be a moderate 2.9 %. In value terms, water-borne coatings are growing at a CAGR of 3.5 %. Asia Pacific (5.1 %) and the Middle East and Africa (3.6 %) are also above the global average. For Europe, the market researchers expect a growth rate of only 2 %.

Thomas Bernhofer of Synthomer agrees with the growth forecasts. The company expects demand to continue to develop positively with a CAGR of 5 %. “We continue to see the market as attractive and interesting, with individual segments offering above-average growth opportunities. We expect accelerated development in the coming years due to demand for sustainable coating solutions and support from the legislative side, such as the Green Deal,” says Bernhofer.

Forecasts for further growth encouraging

The market for water-borne coatings is a very interesting area of the paints and coatings industry that will replace part of the solvent-based sector, Dr Dirk Schwöppe of Synthopol is certain. “This trend can already be observed today. Theoretically, all polymers from the solvent-based area are available, but the way these prepolymers get into the water by means of additives is much more complex,” explains the R&D manager. In the past, aqueous products were usually more costly and complicated to process. “With rising raw material costs and requirements toward sustainability, there is almost no way around water-borne systems, even if there are still challenges in the area of application technology and performance. That’s why we expect the market to double in the next 15 years,” adds Schwöppe.

Event tip: During the EC Conference on Bio-based and Water-based Coatings on November 22 and 23 in Berlin, Rolf Simon from Synthopol will also speak on this topic.

The market for water-borne coatings is growing continuously worldwide. This is due to increasing legal requirements for environmental compatibility and sustainability worldwide, emphasises Dr Nils Kottner from Münzing. “Overall, the market for water-borne coating systems is growing faster worldwide than the coatings market as a whole. Responsible for this are labeling obligations, regulations and legal requirements. Examples include VOC emission restrictions specifically in Europe, North America and China. Demands for improved sustainability of coating systems and compliance with green building standards are other key aspects driving the growth of water-based coatings and paints. Meanwhile, coating systems based on renewable raw materials and consideration of life cycle analysis and carbon footprint are becoming increasingly important,” says Kottner.

Potential for growth in a wide range of segments

In the DIY sector, the water-borne share is already very high, and this trend will continue, according to Schwöppe. He sees further potential in the interior for automobiles or wood/furniture, but also in the industrial sector, such as for stoving enamels and medium corrosion protection.
The largest part of the market for water-borne coating systems is the architectural coatings segment. Thus, Kottner still sees the greatest current potential in the construction segment here as well. “Especially in China and developing countries, there is massive investment in infrastructure, housing projects and industrial buildings. Thus, an increased demand for architectural coatings, including interior paints and basecoats, is to be expected. But wood and furniture coatings, as well as water-based printing inks, are also definitely growth areas.
Bernhofer sees the greatest potential in the area of architectural coatings / trim paints and then metal coatings / anti-corrosion coatings. “In our opinion, the growth potential in the area of water-based furniture coatings has already been largely exhausted.”
In the industrial coatings sector, the share of water-borne coating systems is significantly lower. But here, too, there are more and more coating systems with thoroughly comparable properties to solvent-based coatings, explains Kottner. Wouter Jongepier of Westlake Epoxy considers water-borne protective coatings to be an application area that still requires a high level of expertise in terms of formulation and application. However, when water-borne epoxy coatings are properly formulated and applied, they can match the performance of solvent-based systems. “The switch from solvent-based to water-borne corrosion protection coatings is heavily influenced by legislation. European requirements regarding the reduction of volatile organic compounds (VOCs) seem to be stagnating. In this respect, demand is driven more by general industrial growth and stricter specifications in certain segments, such as the railroad sector. In Europe, we see healthy growth in demand for anticorrosion coatings overall, but this trend could be temporarily weakened by current supply chain disruptions and a potential recession,” Jongepier says. He sees the greatest potential in the application of water-based protective coatings on larger metal structures such as trains, transport vehicles or construction machinery under industrial conditions.

Challenges remain in industrial use

For Schwöppe, strongly fluctuating climatic conditions (temperature/humidity) and the properties such as flow, processability, open time, gloss and resistance, which are not yet fully approachable compared to solventborne coatings, represent a challenge. This means that applications in the industrial sector, such as industrial coatings, marine or aircraft paints, and heavy water-based corrosion protection are rare, he said. Although Bernhofer sees the greatest growth potential in the architectural coatings/trim paints sector, he says that it is precisely here that the replacement of traditional solvent-borne architectural coatings has not yet been solved satisfactorily from a technical point of view due to processor requirements (e.g. long open time, achievable high gloss), and therefore the changeover remains slow. “We see their use in areas of industrial coating as limited for technical reasons, especially where powder coatings and radiation-curing 100% systems have become established, and in plastics coating,” adds Bernhofer. Jongepier takes a similar view. “In segments that can be covered by powder coatings, the application of water-based systems remains limited. A major challenge to water-borne systems continues to be their application under less controllable conditions, such as highly variable and low temperatures, as well as high humidity. Therefore, the use of solvent-free or high-solids technologies may be preferred for very extensive constructions in shipbuilding and offshore applications,” he explains.

Sustainability is an important trend in water-borne coatings. In general, the use of sustainable systems is becoming increasingly important, Kottner says of the trends in water-borne coatings. Specifically, he says, this is about achieving a long service life combined with long-lasting functionality. “In our opinion, the trend towards sustainable raw materials/lacquers and the environmentally conscious certification of these, such as Blue Angel, Nordic Swan, EU Ecolabel, can no longer be stopped. The reduction of co-solvents in the direction of “Zero VOC”, which primarily influence film formation, is also being pushed further. It is not yet possible to estimate what impact the extension of REACH will have on polymers. Qualification of existing products could require a considerable amount of R&D or application technology resources, which would no longer be available for further product development. That would slow down progress,” says Schwöppe. For Jongepier, the frontiers of water-borne epoxy systems are currently shifting toward co-solvent-free systems. “We are continuously working on expanding the application window and robustness of water-borne epoxy systems. As an industrial company, we are improving the carbon footprint of our coating materials in line with the European Green Deal,” Jongepier says.

Bernhofer observes three main trends. “A continuous improvement in the achievable mechanical-technological resistance, e.g. weather-/ UV-resistance, chemical resistance for furniture coatings, block resistance and corrosion protection for metal coatings (up to C5 high). Another trend is the improvement of application properties and enlargement of the application window, such as extended open time and better early rain resistance. The third trend is to improve sustainability, e.g. further VOC reduction, use of renewable raw materials.”