Protective Coatings Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Protective Coatings Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The Global Protective Coatings Market was valued at USD 11,873.11 million in 2020 and is estimated to grow with a CAGR of 3.40% during the forecast period (2021-2026).

The market is negatively impacted by COVID-19 in 2020. The oil and gas (including the chemical industry) sector is one of the major end-users of protective coatings. Moreover, Protective coatings are also used in the Mining and Ore Processing industry for the wear protection of metal equipment. Additionally, these coatings are also used in the infrastructure sector, in order to protect the exposed surfaces from deterioration. Above mentioned sectors were temporarily halted during the government-imposed lockdown, such that to curb the spread of new COVID-19 cases, thereby, negatively impacted on the growth of the studied market, for the short term. However, as the lockdowns were lifted, these end-user sectors started to pick the pace to reach the pre-COVID level, which is expected to enhance the demand for the market studied, through the years to come.

Key Highlights

• Over the short term, growing infrastructure and industrialization in the Asia-Pacific region and growing green coatings demand are likley to drive the market's growth.
• On the flipside, regulations related to the VOC emissions is expected to restrain the growth of the protective coatings market.
• Potential replacement by powder coatings is likely to act as opportunity to the market.
• Globally, the Asia-Pacific region is expected to dominate the market, due to high consumption in countries, such as China and India.

Key Market TrendsThe Increasing Demand from the Infrastructure Industry

• The infrastructure industry accounts for the largest share of the market. Surface deterioration of exposed structures is a major problem in the infrastructure industry. Surface deterioration may lead to structural problems, due to the loss of cover and leading to corrosion of surface reinforcements. To minimize the deterioration, protective coatings are used. The coating material used should be durable, bond well to the surface of the substrate, and be compatible if there is an expansion or a contraction during temperature changes.
• 100% solid/rigid structural polyurethane coating is likely to be the technology of choice, for infrastructure protection in harsh environments. 100% solid/rigid structural polyurethane coating is also used as an anti-corrosive coating for virtually any type of steel structure.
• Countries such as India, Germany, the United States, China, among others are witnessing increasing numbers of projects, investments, in the infrastructure sector. Hence, witnessing consumptions of protective coatings. ​
• For instance, in August 2020, the government of India has identified and listed about 6,835 projects under National Infrastructure Pipeline (NIP), an effort to attract investments in infrastructure development. The NIP aims to invest about Rs 111 lakh crore by 2025 in a range of projects across sectors such as energy, social and commercial infrastructure, communication, water, and sanitation.​
• The government of China planned to increase infrastructural investment, in order to ensure the stability of its sagging economy. According to the report presented in the annual session of the National People’s Congress, in March 2019, CNY 1.8 trillion of investment was planned for road construction and waterway projects​. As the infrastructure projects are rapidly increasing across the globe, the demand for protecting coatings during the forecast period. ​
• However, the slowing down of R&D activities due to the economic slowdown and lockdowns due to the COVID 19 outbreak have a negative impact on the growth of the infrastructure market, thereby affecting the protective coatings market in the short/mid-term. However, post-COVID 19 the market is expected to recover and grow substantially during the forecast period

Asia-Pacific Region to Dominate the Market

• The Asia-Pacific region dominated the global market. China is estimated to hold the largest market share, globally.
• The Chinese infrastructure industry is estimated to hold the largest market share in the country. The country has the largest construction market in the world, encompassing 20% of all construction investments globally. For instance, according to the National Bureau of Statistics of China, the construction output value in the country increased from CNY 9.6 trillion in 2010 to CNY 26.39 trillion in 2020 and the country spent about USD 8 trillion on infrastructure investment in 2020.
• China is a hub for chemical processing, accounting for a major chunk of the chemicals produced globally. With the rising demand for various chemicals worldwide, the demand for protective coating from this sector is projected to increase during the forecast period.
• Furthermore, China is the largest producer of crude steel in the world. According to the world steel association, China produced 1,052,999 thousand tons of steel in 2020 compared to 1,001,306 thousand tons in 2019, which registered a growth of 5.2% despite the pandemic. The strong growth of steel production in the country due to the growing demand from various industries is estimated to drive the market studied during the forecast period.
• China, under its 14th Five Year Plan (2021-2025), has set the target for coal-power capacity to about 1,100 GW. Thus, the network operator, State Grid, and the China Electricity Council have been targeting to develop hundreds of new coal-fired power stations in the country. The country has been looking forward to developing power plants despite overcapacity in the sector, where more than half of the coal-power plants have been witnessing loss and few plants have been running at less than 50% of their capacity.
• Furthermore, in India, the infrastructure sector is an important pillar of the country's economy. The government is taking various initiatives to ensure the timely creation of excellent infrastructure in the country. The government is focusing on railways, road development, housing and urban development, and airport development.
• In this regard, the Indian government announced a target of USD 400 billion investment in infrastructure by 2020, including USD 120.5 billion for developing 27 industrial clusters and USD 75.3 billion for road, railway, and port connectivity projects.
• Besides, the government has been planning to allot investment of about INR 103 lakh crore on infrastructure over the next five years. In this regard, the government has introduced a National Infrastructure Pipeline (NIP), which consists of about 6,500 projects across sectors. These projects would include infrastructure development for housing, healthcare, educational institutes, railway stations, bus terminals, airports, metro and railway transportation, logistics and warehousing, etc.
• In the protective coatings segment, Kansai Nerolac is the clear leader in the country followed by AkzoNobel India, Berger Paints and Nippon Paints.
• India produces about 95 minerals, including 10 metallic minerals, three atomic minerals, four fuel-related minerals, 23 non-metallic minerals, and 55 minor minerals. This makes India one of the major mining countries in the Asia-Pacific region. Many private players are investing actively to boost the mining sector.
• Vedanta Limited is planning a USD 20 billion investment over the coming years across its operations, including increase silver production and steel capacity.
• All the aforementioned factors are likely to significantly impact the demand for protective coatings in the region, over the forecast period.

Competitive Landscape

The global protective coatings market is fragmented in nature, where the top 6 players cater to about 32.94% share of the global demand during 2020. The major market players include Akzo Nobel N.V., The Sherwin Williams Company, PPG Industries, Inc., Jotun, and Hempel A/S, among others.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

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