The global powder coatings market has grown from $3.6 billion in 2001 to $4.5 billion in 2006. Asia Pacific has led the globe in growth, while Europe has been flat and North Americ has grown at a 3.5% annual rate.

“Today’s powder coatings market is relatively healthy, although the emergence of small local producers has created over capacity in the industrial segments, putting pressure on margins,” said Claudio Iurilli, divisional marketing manager, Jotun Power Coatings. “The raw material price hikes and the heightened competition in emerging markets are likely to emphasize this trend even further in 2009.

“Although powder coatings are used in a number of applications where stringent performance requirements need to be met, in certain markets, especially in Asia Pacific, the technology still suffers from the ‘commodity syndrome,'” Iurilli continued. “Increasing the awareness among architects, specifiers and OEMs on the merits of powder coatings is crucial to building confidence in the technology and reduce the perceived risk associated with the conversion from liquid to powder coatings in regards to certain applications.”

The Powder Coating Institute (PCI), which represents the North American powder coating industry, reported growth in value but basically flat in volume, according to Craig Dietz, commercial segment leader, DuPont CoatingSolutions. “I believe that 2008 will be more of the same. Powder manufacturers are sandwiched in the middle of customers who have many choices of where to purchase powder, and our raw material suppliers who have plenty of demand and are experiencing cost increases,” he said. “So you have the powder manufacturer who is receiving weekly price increases from their vendors of materials, while experiencing higher energy, labor and transportation costs. It’s definitely a challenging time, but powder is a green coating technology and will continue to find its way into new applications and new markets.”

Powder coating trends and challenges

The demand for environmentally friendly, low VOC coating solutions will undoubtedly fuel the growth of powder coatings, especially in Europe where the legislation is particularly intense, but also in the Middle East and Asia Pacific where green sustainable architecture practices are rapidly growing, according to Iurilli. “Today we see that architects are giving environmental considerations a more decisive weight in the material selection process,” he said. “Issues such as indoor environmental quality, control of VOC emissions and the amount of energy dissipated during the material’s manufacturing are becoming as critical as the product performance.

“In terms of challenges, from one side raw material price hikes are affecting profitability. From the other side, the sharp competition among the powder coating manufacturers to gain market share in existing and new markets is eroding the selling prices,” Iurilli continued. “Jotun does not enter into price wars in any market; we rather focus on quality and on long-term relationships with customers, although we are noticing that even loyalty is being affected. This type of situation usually stimulates the introduction of high value new products to make a difference and divert the attention of the buyer from price to value.”

For Dietz cost increases are the biggest challenge. “They are hard to pass on because there is extra capacity for powder producers,” he said. “The key for the industry as a whole is to develop powder for heat sensitive substrates and other new applications where one would not immediately think of powder. The major challenge today is passing along cost increases and finding ways to grow the industry during economic softness.”

Growth markets

The architectural aluminum market is growing exponentially in the Middle East and Asia, due to the unprecedented increase in major construction projects in the residential, commercial and monumental markets, said Iurilli. “We also see an increased demand in wood look-alike finishes for applications such as kitchen cabinets, windows and doors,” he said. “There is also increased demand for powder for sensitive substrates such as MDF and plastic. New technologies are helping shaping products to meet this demand, but in general we have not seen a breakthrough in new applications, as the conversion to powder usually requires some investments at the application plants and the owners are not always willing to invest.”

In terms of regional growth, he said the emerging markets of Eastern Europe, Russia, India and China are characterized by the highest growth, due to the rapid development of real estate and construction projects and because of the manufacturing industry shifting to these areas.

Dietz also said that powder is making great inroads in architectural-aluminum extrusions. Regionally he said while Asia and Eastern Europe are growing the fastest because they are developing regions, “North America and Western Europe are holding their own but need technological breakthroughs to sell into new markets.”

Delivering value

In terms of providing value to its customers, Jotun lays great emphasis on internal competence building and customers’ educational programs. The Jotun Powder School offers a series of training tools designed to provide architects, applicators and industry professionals with the essentials on powder coatings, the benefits of using powder coatings from a reliable supplier and the importance of choosing the right powder for the right job.

For DuPont one of its most successful customer programs is Star Coater, a loyalty program for custom coaters. This year the company started an internal group focused on improving customer satisfaction called the Customer Centricity Team. In 2006 DuPont’s inside sales team started providing improved response and consultative help to customers who use lower volumes of powder.

On the R&D front

The powder coating industry is characterized by a very high degree of customization. “Continuous incremental developments or improvements are vital in providing customers with not only optimum coating performance for their requirements but also an optimized application process,” explained Iurilli. “Jotun’s R&D efforts are focused on providing thinner films, improved finish, lower baking temperature, extended outdoor durability, improved corrosion and protective properties.”

“DuPont is in the process of developing architectural coatings containing fluoropolymers, a chrome look process, antimicrobial powders and powder for MDF,” said Dietz. “We are also developing new coatings for the functional pipe market and the rebar market, which involves using powder on steel used for reinforcing concrete.”

In terms of raw material, Dietz said there is a need for ingredients for lower cure powder coatings that also have good storage stability. “Ingredients for one shot low-gloss polyesters with great physicals are in demand and there needs to be an improvement to physical properties such as marring and high slip.”

On the raw material side Jotun sees developments in later years being generally incremental in nature supporting more the short term needs of the industry. “Commercially viable breakthrough developments seem few and far between,” said Iurilli. “We believe that to make powder coatings more than a niche contender in, for example, applications to non-metal/heat sensitive substrates, more fundamental developments are needed particularly on the binder and additives side. Working to enlarge the application areas for powder coatings should be a clear focus for all stakeholders in our industry.

“Though positive developments obviously have taken and are taking place, many raw material offerings to powder coatings are still basically modifications or adaptations of materials originally developed for other uses such as liquid coatings or plastics,” he continued. “More substantial developments on both pigments and additives catering more directly to the specific needs and challenges of powder coatings are in demand.”

Looking ahead

DuPont’s strategy moving ahead includes increasing customer satisfaction and growing the market for powder coatings. “To improve and exceed customer expectations we are surveying customers using a tool that asks one basic question: ‘Would you recommend DuPont to a friend or associate’? There are a few simple follow up questions based on the response,” said Dietz.

“We are also rolling out new product lines like DuPont Colorsplash by Prismatic and leveraging all aspects of our coatings business to provide creative solutions to customer’s unique needs. Additionally, we continue to develop the market for powder on MDF, chrome-look process, architectural powder coatings and antimicrobial powder coatings. We also started our expansion into Canada last year and continue to invest in Asia with our fifth plant that started up in 2007.”

After the restructuring process that took place in 2006, Jotun Powder Coatings had another strong year in terms of top line growth and profitability. Record-breaking volume growth was achieved in all the main units in Europe, Middle East and South East Asia.

“Over the past three years, Jotun Powder Coatings has become increasingly more integrated into the Jotun Group. While the Divisional headquarters remains in Dubai, in 2007, the primary research and development department was moved to Norway, to join forces with the R&D departments of the other Jotun divisions,” explained Iurilli. “By uniting its main R&D functions in Norway, our organization can now access a global pool of resources in pigment laboratories, regulatory information, and health, safety and environmental data.

In March 2008 Jotun inaugurated a state-of-the-art facility in India, a zero-emission and environment friendly paints and powder coatings plant. “Key features of this manufacturing unit include a well-developed recycling process wherein the waste emitted by the production processes is purified internally within the plant and the recycled water is used in the plant itself,” explaine Iurilli.

From a product perspective, throughout 2007 and 2008, Jotun has completed the introduction of its architectural brand, Corro-Coat Durasol, a fluoropolymer-based powder coating engineered to provide long term weathering performance comparable to traditional liquid systems.

“With the construction industry becoming more and more global, Corro-Coat Durasol is now starting to become popular among architects and consultants in the Middle East and South East Asia as an environmentally friendly alternative to liquid coatings,” Iurilli said. “In the functional segment, Jotun launched J-Trac anti-corrosive coatings, a multi-layer fusion bond epoxy (FBE) coating system developed for the protection of pipelines. This multi-layer system provides an engineered coating that absorbs knocks while maintaining a high quality anti-corrosion layer that defends against the inevitability of corrosion.”

Australia’s premier sustainability award

Siew Fong Cheong, HSS powder coatings technical specialist and Bill Matthews, powder coatings technical manager, with the Premier’s Sustainability Award.

On April 17, Dulux Powder Coatings took out the 2008 Premier’s Sustainability Award for Products and Services in Melbourne, Australia. The award, presented by Victorian Premier John Brumby, recognizes the partnership between CSIRO, Dulux Powder Coatings and Sustainability Victoria to develop “Zero Waste Powder Coatings.” This is the leading Victorian award for sustainability.

The entry was based on the development of a new powder coating technology suitable for plastics and other heat sensitive substrates, and is the result of several years work by Dulux Powder Coatings and CSIRO.

This partnership resulted in the development of technology that will generate minimal waste, minimize the release of harmful chemicals to the environment and help to deliver significant savings in cost, electricity and greenhouse gas emissions.

The new powder coating system has been successfully trialled in the Australian State of Victoria, and is now being customized for coating automotive plastics.

The dry coating was also the award winner in the Eco Innovation category at the recent Banksia Awards 2008 in Melbourne.

At the event project leader, CSIRO’s Voytek Gutowski, said the aim of the research was to overcome a long-term sustainability issue for the automotive, plastics and furniture industries by replacing wet paint finishes on heat-sensitive substances, such as plastic components, with zero-waste powder coating technology.

“The problem the team had to solve was that most powder coating particles only stick to surfaces that conduct electricity and the plastics used to make automotive components are not conductive,” Gutowski said.

“We overcame this by coating the plastic components with a nanometer-thin layer of specialty multi-functional molecules, while, for its part, Dulux Powder Coatings developed new-generation powder coatings that can be cured at much lower temperatures and for much shorter times than traditional powders,” he continued.

Sherwin-Williams acquires Becker Powder Coatings in NA

In acquisition news, earlier this year Sherwin-Williams acquired Becker Powder Coatings in North America, a subsidiary of AB Wilh. Becker based in Sweden. Headquartered in Columbus, OH, Becker Powder Coatings makes powder coatings for appliances, metal furniture, fixtures, equipment and electronic products manufactured throughout North America. Becker Powder Coatings has more than 45 employees and sales of roughly $14 million.