Updates and Future Insights for Europe

Since the acceptance of the new ESPR framework legislation came into force in July 2024, more information has come to light that shows some of the future milestones and key dates to be noted for 2025 and 2026.

One of the major approaches to the ESPR framework legislation has been the prioritization of certain industries ahead of others for the early adoption of the ESPR framework by April 19, 2025. These are the industries that form the first batch where that adoption is required:

• Paints
• Chemicals
• Lubricants
• Iron and steel
• Furniture
• Aluminium
• Textiles
• Tires
• Detergents
• Energy-related products with eco-design requirements
• CTI products (communications, technology and information products)

Information on dates and digital product passports (PPDs)

There are no other apparent milestones to be aware of for 2025 at the time of writing,  but 2026 already holds some important ones for ESPR. In January 2026 a delegated act for digital product passports (PPDs, as the EU wishes to refer to them) will be published for the furniture and textile industries and on 19th July 2026 there will be a registry of unique product identifiers for PPDs established, as well as that date being a milestone for the prohibition of the destruction of unsold goods (which will probably affect the clothing sector more than most).

Meanwhile, more information has become available on the nature of PPDs. According to the ESPR rules, the PPDs will be linked to a unique product identifier through a data carrier present on the product packaging. The data present should follow the CS3D or CSDDD standards – i.e. machine readable and accessible to various stakeholders (manufacturers, distributors, authorities, etc.) However, personal consumer data may only be used with agreement.

A digital copy of the DPP should be provided in instances of online retail, as well as a backup copy, to be available through a designated service provider. The DPP should also operate with other systems and be made available until the end of the product’s life span. A central registry will be created by the European Commission to store the unique product identifiers which the PPDs are linked to, as well as other necessary data to ensure customs control and market surveillance. The whole point is to improve product traceability, compliance and transparency of sustainable products within the EU.

Insights into green chemicals and coatings until 2030

The emphasis placed on green or sustainable chemicals is now completely unavoidable to the extent that industry is seeing the takeover of major eco-friendly chemical production companies, especially in Europe. Two years ago, Perstorp was bought by Petronas and now Covestro is being taken over by ADNOC; it’s a time when petrochemical companies have had to redefine themselves and their offerings in order to remain relevant to the chemical sector of the future. So, what to make of the market for green chemicals now?
Europe is clearly the largest market for green chemicals, and Germany is the largest national market for green chemicals in Europe, where demand is being shaped by the breadth of the Green Deal strategy; these are among the findings of a new report (July 2024) from SkyQuest.  The global market for green chemicals will almost double between 2023 and 2031, growing from US$38.4 billion in 2023 to US$72.5 billion in 2031. That’s a CAGR of almost 8.3%. The main definition of green chemicals seems to be anything that can be prefixed with bio- and bio-alcohols are the largest segment. Bio-polymers are not far behind.

A mini-SWOT analysis is the best way of summarizing what characterizes the sector:

Strengths: the main strengths arrive from the health and safety perspective e.g. with substitution of harmful chemicals with non-toxic alternatives. The visible participation by companies in the green chemical sector is good PR in itself (but the marketplace has become quite crowded) so there is already a need to differentiate offerings.

Weaknesses: starting materials are often costlier and the technologies that are needed to effect transformations remain expensive to develop. This translates into higher production costs.

Opportunities: rising eco-consciousness among consumers is the easiest goal. There is also increasing availability of renewable feedstocks and increasing access to transformational technologies, e.g  biocatalysis. The best geographical opportunities are to be found in Europe and Asia. Europe is the largest market, but Asia (especially China and India) is the fastest-growing one. In Europe, EU legislation is the driver, but in Asia the rapid pace of industrial and commercial development is taking place with more concern for the environment than ever before.

Threats: scaling up problems are the Achilles’ heel of this segment.

Industrial applications are the largest end-use sector for bio-based chemicals.

Meanwhile for paint, growth in the European paint market is forecast to be steady at about 4% p.a. for the remainder of the decade, a little behind the global average of 4.8%. A new worldwide paint and coatings study from Grand View Research offers insights into many of different growth factors that are influencing market developments in each of the different regions and provides a perspective on Europe’s place within a global context.

The pie chart below highlights Europe as the second-largest regional market in the world behind Asia, with North America now in third place, a far cry from the pecking orders of the past. The global market for paints and coatings was estimated at just over $200 billion in 2023 by Grand View Research, and Europe’s 30% share equates to a regional market worth about $60 billion.

• Construction remains a prominent driver in various countries, often with the benefit of EU support, Inevitably cascades down into demand for many types of industrial coatings and decorative paints. Major economies in Europe where construction is set to do well include the UK and Ireland, Hungary, Poland, the Netherlands and Sweden.
• Two European countries headlined by Grand View Research are Germany and the UK. The German coatings industry can expect good growth in the automotive sector because of its European prominence in engine production. The greater affordability of vehicles is playing to this sector in particular and automotive production has been on the increase in Germany, Hungary, Romania and Austria.
• Meanwhile, the UK looks to be flourishing on the back of the global aerospace sector, since the aircraft and associated components industries are especially strong in the UK (second only to the USA). 
• Elsewhere in the EMEA region, the Saudi Arabian coatings market continues to flourish through economic diversification and mega-project implementation that buoys up sizeable demand for construction materials and architectural paints.

So although the paint and coatings industry is under a lot of pressure, there is still a lot to play for in the coming years.