In recent years the resins market has faced myriad challenges as a result of rising raw material costs and supply shortages, coupled with the demand for lower VOCs. Resins suppliers have been rising to the occasion by making inroads in rapidly developing areas such as the Asia-Pacific region and with the launch of high performance "greener" products.

"Demand for paint in China and India is growing at double digit rates while the ASEAN Nations (Association of Southeast Asian Nations) top out at approximately six percent," said Craig Mitchell, marketing manager for North American paints and coatings, Celanese. "This strong growth momentum is expected to bolster the resins market in Asia for several years or more."

In 2007, Celanese dedicated a new emulsion polymer facility in Nanjing, China, to provide customers throughout Asia with high-performance, environmentally friendly latex emulsions used in coatings, adhesives and other consumer and industrial markets. "One of our key product offerings in Nanjing is vinyl acetate/ethylene (VAE) emulsion, a binder technology that addresses the need for low-VOC, low odor architectural coatings," said Mitchell. "In China, where formulators have an interest in switching from solvent-based products to water-based products, VAE emulsion technology fits perfectly with marketplace trends."

On the other side of the globe in North America and Europe, growth appears to be fueled primarily by the need for high performance resins that meet the latest VOC standards. "Growth in North America and Europe should be significant," said Markus Hallack, senior technology manager, Tego Coating Additives and Specialty Resins "The emphasis for these regions appears to focus more on high performance, high solids, environmentally friendly and low VOC resin systems."

"In North America there is continued pressure both from regulations and consumer awareness to reduce VOCs and produce more environmentally friendly paints. We consider this a boost to VAE producers like Celanese who cater to this market," said Mitchell.

"From a U.S. perspective, I see a lot of growth potential in the Southeast due to the focus of the region on higher performance specialty markets where the slowdown of the economy appears to be having less effect," said Katie Gaynor, key account manager, Alberdingk Boley, Inc. "Examples of these markets include commercial and consumer concrete coatings as well as factory finished wood coatings such as UV cured furniture and high performance joinery."

Challenges in the Marketplace

Although these developments are certainly bright spots, the resins market continues to face a number of challenges. Rising raw materials prices, VOC regulations and the pressure to keep pricing down are just some of the issues.

"When it comes to the real challenges in today's resins market, there are several variables which need to be taken into consideration," explained Hallack. "The first challenge is the need for higher performance, environmentally friendly resins to replace our conventional systems. The second major challenge is developing these resins to allow formulation at very low to zero VOC levels."

"Raw material price increases continue to be one of the main issues affecting the resins market, particularly petrochemical-related raw material price fluctuations," said Valerie Johnson, communications manager, Eliokem. "Other issues include changing VOC legislation by region in the U.S., which includes non-conformity between the regional legislative environmental groups. Developing resins to serve one regional group may not meet the requirements in another group. Additionally, developing new technologies and maintaining acceptable pricing to the paint manufacturer are also challenges."

"As everyone is aware, the rising cost of raw materials, feedstocks and transportation have boosted the costs for all manufacturers over the past few years," said Mitchell.� "Internally we are looking at our manufacturing and supply chain processes as a strategy to keep our resins manufacturing costs under control. Our customers, the paint manufacturers, are also looking to us to help reduce their overall costs as well."

At the same time the ongoing trend of consolidation among paint manufacturers has created new supply synergies for new resins manufacturers, according to Johnson. "Regional companies are increasingly being acquired by larger manufacturers, which changes our supply arrangements," she said. "Paint manufacturers would like suppliers to maintain pricing and in today's volatile pricing environment it becomes a challenge to maintain."

Maintaining an open line of communication between resins suppliers and coatings manufacturers is vital to success. "At Eliokem we are increasingly trying to partner with our customers to exchange information about the realities of today's volatile petrochemical fluctuations," said Johnson. "For some customers that buy multiple products we have entertained the idea of implementing bulk pricing arrangements for full truck loads of combined products. This is one example of how we are going about managing costs. For Eliokem to continue to absorb price increases or continue passing them on to our customers does not benefit anyone in the long run. We are looking at reducing our costs in other areas to offset the increases."

A Delicate Balance

Resins manufacturers must maintain a delicate balance between developing innovative technologies to meet their customers' needs and keeping costs at an acceptable level.

"Coatings customers are continually seeking high performance and high value resins as they attempt to pass on performance to match their increasing prices as well as to offer differentiation from their competitors," said Gaynor.

"The major demand on resins suppliers is to develop lower cost resins systems that perform at a high level," offered Hallack. "This is due to the focus on lowering raw material costs while the customers try to develop systems that perform at a high level but also meet VOC and environmental regulations."

"As an emulsion supplier, our challenges are virtually the same as our customers in that we are looking at ways to create low VOC products that hit specific targets in both cost and performance," said Mitchell. "We are continually working to advance our resins technology to drive value into our customers' products."

Celanese recently opened its Houston Technology Center (HTC). The 31,200-square-foot facility in�cludes both analytical and application testing laboratories including the paint and coatings group for North America. "At this state-of-the-art facility we will support this local market with VAE and other emulsion technologies that address the specific needs of North American manufacturers," said Mitchell.

Celanese has been providing emulsions for low emission paint in Germany, the Netherlands and the Nordic region, where reduced environmental impact has been a part of their lives for more than a generation. "Celanese is translating this low-emission paint success in Europe to U.S. and Canadian markets, with products designed for the North American marketplace," Mitchell added.

In order to keep up with ever-changing environmental regulations, resins suppliers have invested a lot of time and money into developing new technologies to meet these needs. "Regarding VOC legislation, we are working hard to develop new resins to assist the paint manufacturers," said Johnson. "Eliokem recently hired a new process and development manager to focus on new product development and we are currently recruiting for an additional paint chemist to increase our lab staff. There are several new resins we have launched directly related to reducing VOCs."

"Changing VOC legislation is of top concern for coatings manufacturers, however this is also an opportunity for resins manufacturers if they can develop resins to permit formulating within the VOC limits," Johnson added. "This opportunity has recently prompted Eliokem to develop new resins for porch and floor coatings, low VOC horizontal concrete coatings and swimming pool paints and garage floor coatings."

Eliokem offers Pliotec PA91, an all acrylic latex specifically designed for low VOC porch and floor applications; Pliotec CR30 crosslinking acrylic co-polymer designed for permit formulations of garage floor coatings under 50 g/l VOC; and Pliotec PA20 pure acrylic resins that can be formulated below 50 g/l VOC in several horizontal and vertical masonry coatings.

Celanese offers Celvolit 1774, a vinyl acetate/ethylene (VAE) emulsion that addresses both environmental standards for VOC and the consumer performance requirements for durability, scrub and low odor.

Alberdingk Boley has developed a new generation of solvent-free poly�urethane dispersions to meet the market's need for environmentally friendly alternatives. The company has also developed a new generation of self crosslinking and multi-phase acrylic emulsions to meet the low VOC demands of coating formulators. To meet the need of complete VOC, Alberdingk has developed a range of low viscosity, 100% solids polyols for two-pack industrial applications. "These products also have the environmental advantage of being based on the renewable resource, castor oil," said Gaynor.

The latest resins technologies launched by Tego to address environmental regulations are Silikopon EF and Silikophen P 80/MPA. Silikopon EF is a silicone-epoxy hybrid resin that enables the formulators to develop high gloss, chemical resistant, corrosion resistant and weather resistant coatings that can be formulated at a VOC level of less than 100 g/L. Silikophen P 80/MPA is a methyl phenyl silicone resin that is used for high temperature resistant coatings up to 650�C. The Silikophen P 80/MPA contains HAPS-free solvents and has a solids content of 80% by weight while also providing a moderate degree of corrosion resistance.