Wood Coatings Market

By Kerry Pianoforte, Editor | February 12, 2016

Wood coatings manufacturers continue to enjoy positive growth as a result of a robust housing market.

Demand for wood protection coatings and preservatives is expected to advance 4.5 percent per year through 2018 to $4.8 billion, The Freedonia Group reported in their study “Solvents.” Growth in the industry will primarily be driven by a rebound in residential construction activity, which in turn benefits the major applications in which wood coatings and preservatives are used – namely furniture, decking and siding.

“Further advances will be restrained by the rising use of non-wood materials in several key applications,” said Freedonia analyst Katherine Brink. “Coatings and preservatives will be limited in siding, where wood is forecast to account for a shrinking share of demand and faces fierce competition from alternative materials.”  In decking applications, although wood still dominates, plastic composite decking continues to erode wood’s share, which also puts a dent in wood protection product sales.

Freedonia predicts that demand for coatings is projected to rise 4.7 percent annually through 2018.  Maintenance end uses account for a slightly higher share of coatings demand, driven by the needs of the large existing base of wood items.  Even so, Freedonia analysts contend that demand for new coatings in construction-related applications will be the primary impetus for accelerating demand gains through 2018.  Demand for wood preservatives is expected to increase 2.7 percent annually through 2018.  Gains will be supported by the rising production of pressure-treated lumber as construction activity rebounds.  Faster advances will be restrained by the maturity of a number of applications, such as railroad products and utility poles. 

Wood protection product usage varies depending on the application.  Paint is the dominant product in siding and window and door applications, but stains and sealers are more widely used on decks, cabinets, furniture, and flooring.  Similarly, oil-based preservatives including creosote and penta tend to be utilized in industrial applications such as railroad products and utility poles, while water-based types such as copper azole and ACQ are used to treat wood intended for residential and non-industrial applications.

Wood coatings manufacturers Coatings World interviewed expressed satisfaction with the current state of the wood coatings market and are optimistic this upward trend will continue.

“Positive housing trends, such as new home construction and the rise in home values, positively impact the architectural coatings industry as a whole,” said Alison Bruce, woodcare brand manager for the Sikkens ProLuxe, Flood, Deft brands, PPG Architectural Coatings U.S. and Canada. “We see that consumers are becoming increasingly interested in the interior and exterior finish of their wood surfaces, and the wood coatings segment is expected to grow at a compound annual growth rate of three percent which is mostly fueled by the housing recovery, according to a Freedonia Group study.”

“The wood coatings category has always correlated with the housing market and existing home sales as staining and refreshing your deck is one of the first projects completed by the seller before selling a house or by the buyer after buying a home,” said Mike Kozlowski, director of marketing, Exterior Wood Care at Sherwin-Williams. “This category often has a 6-12 month lag when it comes to new construction home sales due to deck additions or finishing a deck 1-2 years after purchase. In general, the wood coatings category began slightly below expectation as the weather in Q2 of 2015 was historically one of the wettest seasons. However, the unusual warmth in late Q3 and all of Q4 allowed the wood coatings category to bounce back from a slow start.”

“The wood care market sales have increased and are running ahead of last year,” said Jason Olson, brand director for Rust-Oleum. “Boomers are downsizing from traditional five-bedroom family houses to updated three-bedroom homes or condos and finding their heirloom furniture and décor is no longer scaled to fit the new, sleekly designed contemporary environments.  Their furniture and décor feels dated and consumers are updating both.  Millennials are driving their own trends as well.  Environmentally friendly and repurposed/reclaimed furniture and décor trumps other considerations.”

Key Markets and Trends

The North American decorative wood coatings marketplace is primarily driven by a demand for exterior coatings, with decks and siding comprising the largest percentage of exterior substrates. According to a recent PPG survey, 50 percent of U.S. respondents have decks and 96 percent of these respondents use their decks during the day and almost every other day.

“We are finding that of the total coatings usage, maintenance (or recoating of wood substrates post-installation) accounts for half of the total coatings usage,” said Bruce. “Furthermore, stains account for the largest share of demand for wood coatings. With the high instances of maintenance coatings and the popularity of stains, we are seeing a steady demand for exterior wood coatings.”
“In addition, do-it-yourself (DIY) customers at big box retailers continue to make up the largest percentage of purchase volume within decorative wood coatings, which was also reinforced through recent PPG survey data,” Bruce continued. “Survey results indicated that 47 percent of U.S. respondents agreed that they would prefer to do an exterior stain project themselves (rather than have a professional do it), and 43 percent of U.S. consumer respondents noted that they find staining a deck and painting a room to be about the same level of difficulty.”

DIY homeowners continue to drive the market for wood coatings. “This market enjoys taking on remodeling projects as they feel their house is an expression of personal style,” said Kozlowski. “They take pride in their home and look for new and interesting products to beautify and protect their investments. We continue to see the trend of wanting to bring indoor design elements to outdoor spaces. This can be seen by homeowners bringing the open floor concepts outdoors with multicolor stained decks, special lighting, furniture, and even kitchens.”

“Our customers are looking for a product that both protects and delivers long-lasting beauty for their outdoor wood projects,” Kozlowski continued. “It is important for wood coating products to be able to handle the exterior elements year over year (water, sun, snow, etc.)  as all of these factors can take a toll on the wood.  All of the exterior stain products within the Thompson’s WaterSeal brand are specially formulated to protect the wood from these outdoor elements with a special coating that resists mildew and UV damage, as well as, exceeds the industry standard ASTM D-4446 for waterproofing wood.”

In 2015, Thompson’s WaterSeal introduced an innovative formula to the exterior wood waterproofing and staining category with Penetrating Timber Oil. This product’s unique blend of fast-absorbing oils is designed to nourish and beautify all exterior woods, including hardwoods, with just one coat. “Thomspon’s WaterSeal Penetrating Timber Oil features premium iron oxide pigments to help minimize lap marks and color-streaking for long-lasting, beautiful color that holds up to heavy foot traffic,” said Kozlowski. “The new formula penetrates deep below the surface to reduce marring and visible scratches, making it ideal for any outdoor deck or patio. In addition to enhancing wood’s natural beauty, Penetrating Timber Oil provides year-round water damage protection and a coating that resists mildew and UV damage.  This product can be applied with a paint pad, brush, roller or compression driven sprayer.”

Customers are looking for a number of key characteristics in their wood coating products. Top requests include on-trend colors and products that allow projects to be completed fasted without sacrificing quality. 

Among Rust-Oleum’s latest offerings is Triple Thick Polyurethane. One coat of Triple Thick Polyurethane is equal to three coats of a traditional polyurethane.  Consumers complete their polyurethane projects in one coat (3 times faster).  Other features include advanced self-leveling formula reduces brush marks during application, ultimate durability in one coat and ideal for interior horizontal and vertical surfaces (not floors). This product is offered in gloss, semi-gloss, satin and matte sheens.

Rust-Oleum also offers Innovative Stain Formula that delivers deep, rich color in one coat, has an ultra fast one hour dry time, 75 percent more square foot coverage than competition - 275 sqare feet/quart, requires no wood conditioner and offers significant time savings.

“New stain colors are designed to replicate the popular reclaimed wood trend,” said Olson. “These colors are great for stain layering and adding interest to any project.” 

PPG is seeing an increase in the demand for more premium wood coatings. “In recent studies, we’ve seen that approximately a quarter of sales are coming from the price point of $30-40,” said Bruce. “Both professional and DIY customers are looking for durable wood coatings with long lasting protection that are easy to apply and clean up and resist damage from the outside elements, such as rain and sun.”

In January 2016, PPG introduced the FLOOD Pro Series line, which incorporates the latest advances from PPG’s global woodcare technology and capitalizes on the 175-year heritage of the Flood brand. These products, formulated to meet the unique needs of professional and do-it-yourself customers, include stain products from transparent to opaque, as well as prep products and a new resurfacer. This line will utilize PPG’s extensive color platform, which includes a collection of 40 semi-transparent and over 120 opaque hues that enhance the natural beauty of wood, the company said.

In addition, PPG’s OLYMPIC brand introduced Olympic MAXIMUM exterior stain products with Weather-Ready Application capabilities in January 2016. “Exclusive to Olympic MAXIMUM stain, the Weather-Ready Application gives consumers greater opportunities to stain when it may rain or if the climate is too hot or cold,” said Bruce. “Now, users can stain when they want and not when the weather dictates.”

PPG has also recently launched the DEFT Interior wood finishing program that includes a full, balanced line of lacquers, varnishes and stain products available at PPG Paints stores and independent dealers. These are available in oil-based, water-based and fast drying formulations and can be used on a variety of interior wood surfaces, including floors, doors, trim and furniture. 

AkzoNobel Creates Regional Wood Coatings Service Center in Eastern Canada

AkzoNobel  will create a Regional Service Center for Wood Coatings at its Warwick, Quebec site. The facility will become the commercial headquarters for the Wood Coatings business in Eastern Canada and provide local support as the business’s R&D and Technical Application Center for Canada. It is due to be fully operational by mid-2016 

The facility will provide services including quick-response small batch manufacturing, product development for the local Canadian market, custom color matching, and commercial and customer support. As previously announced, the large-scale batch manufacturing will be transferred to other AkzoNobel sites in North America, including Port Hope, Ontario.

 “This investment allows us to continue offering the broad range of services that our customers expect from AkzoNobel and the Warwick site, reinforcing our leading positon in the North American market,” said Doug Gilliam, regional director of AkzoNobel’s Wood Coatings business in North America. “The facility will ensure outstanding support, with dedicated on-site teams focusing on meeting our customers’ needs and expectations.”

AkzoNobel is a leading supplier of wood coatings for commercial and industrial customers in the furniture, flooring, building products and cabinetry markets, and has been serving Eastern Canada for over 50 years. 

“We remain highly committed to the Canadian market and this investment demonstrates our continued drive to bring leading technologies and services across the region,” Gilliam added. 

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