The Exterior Architectural Coating Market is forecast to reach US$ 34.8 billion by 2027, after growing at a CAGR of 5.3% during the forecast period (2022-2027). The Exterior Architectural Coating is primarily composed of Epoxy, Polyurethane, Alkyd, Poly Vinyl Acetate (PVA), Acrylic resins, or other resins. They are available in a wide range of product types which include Primer, Enamel, Lacquers, Sealers, and Emulsions such as styrene-acrylic emulsions or emulsion paints. According to recent insights from the World Cement, the global construction industry output is expected to increase by 5.7% in 2021. An increase in construction activities and demand for VOC (Volatile Organic Compounds)-free coatings acts as major drivers for the market. On the other hand, fluctuating prices of raw materials including resins, titanium oxides, solvents, pigments, and additives are likely to obstruct the market and hinder its growth.
There is no doubt that the COVID-19 lockdown has significantly reduced construction, and production activities as a result of the country-wise shutdown of construction sites, shortage of labor, and the decline of supply and demand chain all over the world, thus, affecting the market. Studies show that the outbreak of COVID-19 sharply declined the production of raw materials in 2020 due to a lack of operations across multiple countries around the world. However, a slow recovery in new development and construction contracts has been witnessed across many countries around the world since 2021. For instance, The Iron Bridge Magnetite project that is expected to deliver 22mtpa of high-grade 67 percent Fe magnetite concentrate product is currently undergoing development. The overall cost of the project is expected to reach around £1.96 billion Mota-Engil (US$ 2.35 billion). The project will include the use of architectural coatings to coat the exteriors of the bridge infrastructure.
In this way, a steady increase in construction activities will require the use of Exterior Architectural Coating composed of epoxy, vinyl acetate, acrylic resin, or others in order to coat the exteriors of a commercial, residential or industrial building. This will eventually lead to an increase in demand for Exterior Architectural Coating which indicates a slow and steady recovery of the market in the upcoming years.
Exterior Architectural Coating Market Segment Analysis – By Resin
The Acrylic Resin held the largest share in the Exterior Architectural Coating Market in 2021 and is expected to grow at a CAGR of 5.5% between 2022 and 2027, owing to the increasing demand for acrylic resin due to the characteristics and benefits it offers over other types of resin. For instance, it has a wide range of characteristics, such as easy processing, corrosion resistance and they provide higher protection from exposure to rain, wind, snow, UV light, and other factors as compared to Polyurethane, Alkyd, Polypropylene, and other resins. Moreover, acrylic resins are easier to process, have high strength, low reduction during cure, along with excellent weather resistance, oxygen permeability, excellent hardness, and exterior durability which makes them ideal for use in the exterior architectural coating in comparison to other resins. Hence, all of these factors are driving its demand over other types of resin, which in turn, is expected to boost the market growth in the upcoming years.
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Exterior Architectural Coating Market Segment Analysis – By Product Type
The Emulsion held a significant share of 30% in the Exterior Architectural Coating Market in 2021, owing to its increasing demand due to the properties and advantages they offer. Emulsion paints have less volatile organic compounds (VOCs), are less toxic, easier to apply, and dry can be easily cleaned in comparison to primer, enamel, lacquers, and other types. Moreover, emulsion paints can be painted to any surface including walls, metal, glass, wood, and concrete, and are more resistant to moisture, UV light, and changes in temperature as opposed to primer, enamel, lacquers, and other types. It is non-inflammable in nature and is also less likely to cause problems such as skin irritations as compared to other product types. All of these factors will eventually increase the demand for the emulsion to be used in Exterior Architectural Coating, thus, boosting the market growth.
Exterior Architectural Coating Market Segment Analysis – By Coating Technology
The Water-borne Coatings held a significant share of 34% in the Exterior Architectural Coating Market in 2021, owing to a range of advantages they offer over other types of coating technology. Waterborne coatings are surface coatings that contain 80% water and a small number of other solvents such as polyvinyl ether and glycol. It offers a wide range of properties and benefits such as excellent adhesion properties, good resistance to heat and abrasion, along with anti-corrosion properties in comparison to solvent-borne and other types of coatings. Moreover, water-borne coatings are environment friendly due to low VOC and HAP levels which makes them less toxic and flammable in comparison to solvent-borne, and other coating technology. All of these factors are most likely to increase the demand for water-borne Exterior Architectural Coating, thus, boosting the market growth in the upcoming years.
Exterior Architectural Coating Market Segment Analysis – By Application
The residential segment held the largest share in the Exterior Architectural Coating Market in 2020 and is expected to grow at a CAGR of 5.7% between 2022 and 2027, owing to the increase in construction of residential buildings across the globe. For instance, in October 2021, the Ministry of Construction of Vietnam had proposed VND 30 trillion (US$ 1.3 billion) credit package to build low-cost residential homes for workers. Likewise, MoC had proposed 266 residential housing projects with more than 142,000 units totaling more than 7.1 million square meters across the country in 2021. Another 278 residential projects including 276,000 units with a total area of 13.8 million square meters are currently under development in Vietnam. All of these projects are scheduled to begin in 2022 and be completed by the end of 2025.
Furthermore, recent insights from Construct Connect states that the US government has funded around US$ 20,000 for the construction of a Real Estate and Development project called One Central Project in Chicago. The project is under the Schematic Design phase and currently undergoing construction in 2022. Hence, an increase in construction of buildings for residential sectors can lead to an increase in demand for exterior architectural coatings, thus, leading to market growth in the upcoming years.
Exterior Architectural Coating Market Segment Analysis – By Geography
The Asia Pacific held the largest share in the Exterior Architectural Coating Market in 2021 up to 30%. The consumption of Exterior Architectural Coating is particularly high in this region due to its increasing demand from the construction sectors. For instance, in December 2021, CapitaLand Group, a leading real estate group in Asia, announced the acquisition of a prime site for its large-scale residential project in Vietnam, with a projected total gross development value of approximately US$ 1.12 billion. The site is located in Binh Duong province, Vietnam. The project is expected to be launched in phases and construction of the first phase consisting of about 1,300 houses and apartments will start in 2022. Completion of the first phase is stated to be in 2024, while the rest of the project is scheduled for completion in 2027. In 2020, the Ho Chi Minh City Committee in Vietnam announced the commencement of building a high-rise commercial-financial service condominium Tower in Tan Phu District which is due delivery by the end of 2022. Likewise, the development of a high-rise condominium with commercial services, in Ward 16, District 8 of Ho Chi Minh City, is undergoing development and is expected to be completed in 2024.
Furthermore, the government of China approved 26 infrastructure projects with an estimated total investment of 981.7 billion yuan (US$ 142 billion) in 2019. Other countries like Bangladesh also has two ongoing power plant projects estimated at US$ 17.65 billion in total which is due delivery by 2025. In this way, an increase in building and construction activities will increase the demand for the use of Exterior Architectural Coating composed of epoxy, vinyl acetate, acrylic resin, or others in order to coat the exteriors of a commercial, residential or industrial building. This is most likely to lead to the growth of the Exterior Architectural Coating Market in the upcoming years.
Exterior Architectural Coating Market Drivers
An increase in construction activities is most likely to increase demand for the product
Construction activities are considered to be the pillar of growth for a country and also play a major role in increasing the overall global economy. For instance, according to Volvo CE, the construction sector saw an increase in construction activities across multiple regions since the fourth quarter of 2020. South America saw an increase of 12%, Asia by 39%, Europe by 20%, and China by 28% in 2020. Furthermore, the Middle East also saw significant growth in the construction sector since 2020. Recent insights from the Economic Times states that the FIFA World Cup that is to be held in 2022 in Qatar is expected to generate the huge potential for architectural coatings used in the country. The project included a total investment of US$ 360 million in order to build a 40,000 seater stadium in Qatar. This project required the use of architectural coatings in order to coat the exteriors of the huge stadium. Likewise, other countries such as Kuwait, Morocco, and Iran are also estimated to have higher growth in the construction sector during the forecast period.
Hence, an increase in global construction activities can lead to an increase in demand for exterior architectural coatings for the purpose of coating the exteriors of a commercial, residential or industrial building. This is most likely to drive the growth of the market in the upcoming years.
An increase in demand for VOC (Volatile Organic Compounds)-free coatings is most likely to increase demand for the product
The Environmental Protection Agency (EPA) regulates the use of architectural coatings. EPA Regulation 63 FR 48848 under the authority of Section 183(e) of the Clean Air Act, has listed the laws for the permissible limits of architectural coatings application. Since most architectural coatings contain VOCs or HAPs (Hazardous Air Pollutants), this regulation was primarily enforced with those elements in mind. It further states that architectural coatings should be performed effectively as per the EPA’s Summary of Regulations Controlling Air Emissions from Coating Operations. The misuse of these regulations can lead to a serious charge or penalty. Hence, all the manufacturers from multiple industries are bound to follow these regulations and tend to opt for low-VOC coatings that are more environmental-friendly in order to avoid such penalties. This, in turn, has increased the demand for low-VOC coatings such as water-borne, powder, and radiation cure coating technologies. All of these factors are most likely to drive market growth in the upcoming years.
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Exterior Architectural Coating Market Challenges
Fluctuating prices of raw materials including resins, titanium oxides, solvent, pigments, and additives may confine the market growth
Shortage and lack of availability of key raw materials along with a significant increase in prices are causing disruption to the coatings industries in the UK, Europe, and other regions across the world. For instance, BCF’s monthly raw material prices survey shows the largest increase in prices of solvent in January 2021 in comparison to last year. The results depicted an increase in prices of acetone by 123%, n-butyl acetate by 91%, IPA by 41%, and n-butanol by 54%. Likewise, a sharp increase in prices for epoxy resins has been seen during the first quarter of 2021, an increase of 60% in comparison to the third quarter of 2020. Other raw materials prices are also expected to increase by 2022. Hence, fluctuating prices of such raw materials may confine the market growth.
Exterior Architectural Coating Industry Outlook
Technology launches, acquisitions, and R&D activities are key strategies adopted by players in the Exterior Architectural Coating Market. Exterior Architectural Coating top 10 companies include:
PPG Industries Inc.
Nippon Paint Holdings Co. Ltd.
Akzo Nobel N.V.
Benjamin Moore & Co.
Dow Chemical Company
Axalta Coating Systems
In February 2021, Portugal-based coatings company CIN signed an agreement with the Boero Group, an Italian coatings company that mainly focuses on both architectural and naval coatings. The major aim of this alliance is to develop the company’s activity from Genoa, and Rivalta Scrivia, while enhancing its identity and management.”In July 2020, O3 Company launched a new production site in the Rostov region. The site is capable of producing professional architectural coatings, fire-resistant materials, anti-corrosion coatings, antiviral and antibacterial coatings, along with disinfectants and cleaning. The annual production capacity of the site is estimated to be around 30 million liters of products per year.
The Acrylic Resin in Exterior Architectural Coating Market is expected to see the fastest growth, especially during the forecast period. Its wide range of characteristics, corrosion resistance, and heat resistance properties made it stand out in comparison to other resins in the market.
Water-borne coating technology in Exterior Architectural Coating Market is expected to see the fastest growth, especially during the forecast period, owing to its increasing demand and benefits over other types of coating technology.
Asia-Pacific dominated the Exterior Architectural Coating Market in 2021, with countries like China, and India most likely to drive the market growth, owing to the increasing demand for Exterior Architectural Coating from construction sectors in the region.
Architectural Coatings Market
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