China's paint market may continue to rise

China's paint market may continue to rise

In the course of development in recent years, China has gradually become a global paint producing and consuming country. In 2011, China’s paint output broke through the ten million tons mark for the first time and reached 12.71 million tons in 2012, an increase of 11.75% compared to 2011. China's paint output continued its upward trend in 2012. By November, China's total paint production reached 11.7985 million tons, an increase of 5.68% year-on-year. Although the total production of paints in China has maintained a certain growth in 2013, the growth rate has dropped significantly. How will China's paint market develop in 2014?

Environmental pressure has forced paint companies to transform since 2013. As haze weather often “visits” and seriously damages people’s health, the relevant national authorities have successively issued “Action Plan for Air Pollution Prevention” in 2013. A number of environmental protection policies, such as the Guidelines on Open Government Information on Environmental Impact Assessment for Construction Projects and the Notice on Strengthening the Supervision and Administration of Environmental Impact Assessment, have been added to the governance of environmental pollution. However, as a heavy pollution industry in the chemical industry, coatings have also been included in the list of governance. According to reports, the "Circular of the State Council on Issuing Action Plans for the Prevention and Control of Atmospheric Pollution" issued by the State Council in September has deliberately given important instructions to the future development of China's paint industry.

The notice pointed out that in the petrochemical, organic chemicals, surface coating, packaging and printing industries such as the implementation of comprehensive management of volatile organic compounds in the petrochemical industry to carry out "leakage detection and repair" technology transformation. The oil and gas recovery and treatment of gas stations, oil storage tanks, and tanker trucks will be completed in limited time, and oil and gas recovery and treatment will be actively carried out at the crude oil product oil terminal. Improve the limits for volatile organic compounds such as coatings and adhesives, promote the use of water-based coatings, and encourage the production, sale, and use of low-toxicity, low-volatile organic solvents.

The development of waterborne coatings will certainly have a serious impact on the development space of solvent-based coatings companies in China. However, nearly 60% of coating companies in China are still based on solvent-based coatings. In the next 3 to 5 years, when the solvent-based paint market shrinks dramatically, solvent-based paint companies want to survive, they must combine the actual development of the industry and the quality of the environment, and have a small distribution, low-level equipment, and poor environmental protection facilities. Coating companies conduct comprehensive investigations, formulate comprehensive rectification programs, and implement classified management. Further improve the standards of environmental protection, energy consumption, safety, quality, etc., and eliminate some of the backward small-scale paint companies. For medium-sized solvent-based companies, mergers and reorganizations must be the main focus. Through the integration of resources among enterprises, industrial transformation and upgrading are forced. Therefore, in 2014, China's coatings will be the theme of environmental protection, and on the premise of adhering to environmental protection, sustainable development will be achieved.

Accelerating the Strategic Transfer of the Paint Market Today's paint industry has evolved from the "shortage market" of the last century to the "excess market" and has undergone a fundamental reversal from "corporate leading market" to "market leading enterprise". Quality competition leads to various crises. In this regard, the general strategy of paint companies is sinking channels. The sinking of the channel is accompanied by the transfer of market focus from the province and the city to the county. The coating market has shifted its focus to the third and fourth tier cities and the sales structure has changed significantly.

The way to maintain steady economic growth in China depends on urbanization and expansion of domestic demand, while the third- and fourth-tier cities are the mainstay. However, it is necessary to make a calm analysis of the selection of cities in the 3rd and 4th cities, conduct in-depth understanding of and research on the development of several pre-arranged coatings for the third and fourth tier cities, and formulate a practical "operational plan." At present, the paint market for the third and fourth lines in the central and southeastern regions is basically saturated, so paint companies should shift their development focus to the western and southwestern regions. The development of the coating market in the western and southwestern regions has unique advantages. For example, in the northwest, China Nuclear Huayuan, one of China’s four listed titanium dioxide companies, is very convenient in the procurement of raw materials, and it also saves companies a lot of money. cost.

In the southwestern region, there are a number of titanium dioxide enterprises such as Panzhihua Steel Titanium Industry and Ningbo Xinfu, and the southwest region faces foreign countries and can directly transport paint products to Vietnam, Laos and other countries through land transport; In the northeast region, this is a big "cake" for coating companies. Therefore, the focus of the development of paint companies in 2014 should be shifted to the southwest and northwest regions and the northeast region to achieve a strategic shift.

China's coating market demand has a lot of room for improvement, and these spaces require coating companies to continue to develop and continue to expand. Through the above analysis, we can see that in 2014 China's paint industry's development focus is to achieve transformation and layout of the southwest, northwest and northeast regions under the pressure of environmental protection. However, for the forecast of China's paint production in 2014, Xiao Bian believes that in the case of a transformation of the company and a strategic turnaround, the total amount of paint products in China will maintain a growth rate of 5% to 8% over the next three to five years.

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