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    Market Research

    China Water-Based Coating Industry Report, 2014-2018

    ...

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    So far, China has become the world's largest coating production and consumption country. In 2014, China's coating output reached 16,482 kt, accounting for 38% of the global total and consisting of 5,357 kt of construction coatings and 11,125 kt of industrial coatings (including 1,780 kt of automobile coatings).

    Despite rapid development, China's coating industry is still at the initial stage, with a low penetration rate compared with developed countries. In 2014, China's water-based coating production approximated 1,648 kt, occupying 10% of total coatings, and the market size totaled around RMB46.48 billion. Driven by good policies, especially the Notice of Taxation on Battery and Coating Consumption issued by the State Administration of Taxation, China's water-based coatings are expected to develop at a fast pace, and the penetration rate will be improved.

    China's water-based coating market is now dominated by international brands represented by BASF, Axalta and AkzoNobel. Moreover, these major international brands are still expanding their water-based coating capacities in China to further enhance competitiveness.

    In January 2014, Axalta invested USD50 million in the construction of a 25 kt/a quality water-based coatings plant in Shanghai. The plant was to be put into operation in 2015. In November 2014, Akzo Nobel Swire Paints (Chengdu) Ltd started its water-based coating project, and the first phase worth RMB360 million is to be completed in 2015. In May 2015, BASF announced to invest RMB1.06 billion in expanding a 79.5 kt/a automotive coating project, including 9.5 kt/a waterborne colored paint, 5 kt/a solvent-based undercoat, 25 kt/a varnish, and 40 kt/a diluent, expected to go into operation in 2017.

    In contrast, the Chinese water-based coating manufacturers are less competitive, with the representative enterprises including Shanghai Kinlita Chemical Co., Ltd. (KNT), SKSHU Paint Co., Ltd, Shenzhen Rainbow Fine Chemical Industry Co., Ltd. and Zhanchen Paints Co., Ltd.

    As one of the leading water-based coating producers in China, KNT successfully launched 1-generation two-component cathodic electrodeposited coating in 1998, making it the only enterprise with proprietary brand that mass produces cathodic electrodeposited coatings (with an annual output of over 10 kt). In 2015, KNT, together with a subsidiary of Axalta, established a joint venture, in which a 50.1% stake is held by KNT. The new joint venture is mainly engaged in sales of paints and coatings for commercial trucks.

    SKSHU has 4 wholly-owned subsidiaries, whose products cover a full range of coating products, including home-decoration coatings, construction coatings, and carpentry paints. In 2014, the company's water-based coating output totaled 112.5 kt, which generated revenue of about RMB680 million. In the same year, SKSHU filed for an IPO and raised funds to expand an 80 kt/a water-based coating project.

    Zhanchen Paints has 7 major production bases nationwide. Up until now, it has obtained 235 rights of invention patent and invention patent application, and has participated in formulating and revising 19 national coating industry standards. In 2014, the company's revenue approached RMB1.8 billion. In January 2015, the company announced to resume the IPO program, and it is now preparing for the application materials.

    China Water-based Coating Industry Report, 2015-2018 is mainly concerned with the following:
    • Development of global water-based coating industry, including development status market size, etc.;
    • Development of China's water-based coating industry, including development status, related policies, market size, import and export, competition pattern, etc.;
    • Forecast and outlook of China's water-based coating industry, operation of major enterprises, as well as development of upstream and downstream sectors;
    • Operation and water-based coating business of top 10 players in China.
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