Kerry Pianoforte11.02.09
The adhesives and sealants industry has endured another tough year. As industrial sectors, the automotive industry and the housing market all continue to struggle, manufacturers of adhesives and sealants reported softer demand.
The major markets for adhesives and sealants-transportation and construction-are down significantly, which of course has had a negative impact on many of the technology categories of adhesives and sealants, according to Steve Meehan, bonding business director, 3M industrial adhesives and tapes division. "There is also significant overcapacity in the industry, from suppliers to manufacturers to customers, so things will remain fiercely competitive during a recovery," he said. "The recession has given some relief on the availability of some raw materials, such as synthetic rubber, but depending on the rate of recovery, we could experience some shortages again in the near future."
Although certain major markets have stabilized somewhat, the demand being generated by major industrial customers remains significantly below the prior-year level. "The global reduction in manufacturing output among major industrial customers again significantly impacted the development of the specialty adhesives and surface treatment segment," said Christoph Schmidt, brand and business unit communications, adhesives technologies, Henkel. "This is particularly so in the case of the automotive and electronics sectors, and also the metals industry, with the associated markets having shrunken, in some cases, by up to 20%. The effects of the recession are particularly noticeable in Western Europe and North America."
According to David Fuller, vice president, marketing, DAP Products Inc, the biggest factor impacting the manufacture of adhesives and sealants has been the housing market. "The sale of existing homes has curtailed DIY and professional activity due to a slowdown in the turnover of homes," he said. "The National Association of Realtors indicates that sales of existing homes, in number of units, dropped from 6.5 million in 2006 to a seasonally adjusted rate of 5.1 million units at the end of August 2009 representing a 21% drop. This has a direct impact on our business considering our products are used in the preparation of putting a house up for sale as well as the changes a buyer makes to their new home after purchase."
In addition to the challenges of the economic downturn, adhesives and sealant manufacturers have had to contend with raw material prices. "Soft demand and overcapacity means that passing on any raw material cost increase to the end user customer is a difficult proposition," said Meehan. "Therefore, cost control is an absolute necessity to offset raw material and energy cost increases. Lean manufacturing practices and insourcing where there is available capacity are key components to our cost control programs."
During tough economic times, consumers oftentimes put off hiring contractors for projects and opt instead to save money and to undertake these projects themselves.
"The DIY segment offers the most opportunity in this type of market," said Fuller. "Consumers may downgrade the size and cost of home improvement projects, but they will continue to invest into their homes because they wish to take care of and properly maintain them. In addition, DIYers and energy conscious homeowners represent an ideal audience to promote and educate the benefits related to home weatherization such as energy conservation and utility cost reduction."
"Within the adhesives business, the consumer-related segments such as adhesives for craftsmen and consumers, or packaging, consumer goods and construction adhesives exhibited more stability overall," said Schmidt.
The trend toward sustainability and lowering VOCs continues to pick up steam in the adhesive and sealants market. "VOC and related regulations continue to be implemented and expanded dictating manufacturers to formulate new and more environmentally friendly products," said Fuller. "We have taken a proactive approach and formulate products which exceed these expectations. A good example is our new DAP 3.0 Advanced Sealants that were formulated with virtually no VOCs."
"Sustainability is of great interest to customers who are looking for ways to reduce their carbon footprint," said Meehan. "It is more than just a decision between water-based adhesive versus solvent-based adhesives, however, as the term, 'sustainability,' can have many different meanings and interpretations. Some customers are interested in the overall impact from a Life Cycle Analysis point of view. It is still debatable, however, whether customers will pay more the more sustainable solution. Manufacturers of adhesives and sealants will have to consider sustainability issues in all new product development efforts going forward."
Royal Adhesives and Sealants LLC has launched new VOC compliant Silaprene Contact Adhesives. Silaprene low VOC Contact Adhesives are EPA compliant and customizable to meet the needs of its industrial customers. For use in the transportaion, assembly, foam and furniture, HVAC, recreational vehicles and marine industries, these new contact adhesives and cements contain less than 250 grams per liter of VOCs, compared to more than 600 grams per liter of VOCs in traditional solvent-based adhesives and cements.
"This new line of Silaprene brand low VOC adhesives and contact cements can be tailored to the application requirements of our customers without requiring large minimum orders which allows us to work with customers on all sizes of potential applications," said Ted Clark, CEO, Royal Adhesives and Sealants LLC. "Royal's experienced research and development department works closely with industrial customers to develop new products and modify existing products that will meet their needs for green strength, application times and physical properties."
Henkel's Macroplast UK 8340 is the first polyurethane adhesive to be certified by Germanisher Lloyd for bonding rotor blades for the wind power sector. "Wind turbines must perform reliably for a specified service life of 20 years without major repairs," said Schmidt. "And the rotor blades of large turbines have to satisfy especially stringent standards regarding fatigue strength. Conventionally, they are bonded together by using epoxy adhesives certified for this application by Germanischer Lloyd (GL). With Macroplast UK 8340, Henkel is now the first company to develop a GL-certified polyurethane adhesive for rotor-blade production."
Macroplast UK 8340 two-component system features rapid curing, which means considerable energy saving potential. It also features excellent wetting, which shortens time consuming and costly preliminary work such as sanding and laminating.
3M has introduced its latest technology in structural adhesives-3M Scotch-Weld Toughened Epoxy Adhesive DP920-designed for metal-to-metal bonding in agricultural equipment, appliances, elevator panels, construction equipment, specialty vehicles, trailers and a number of other applications. New 3M Scotch-Weld Toughened Epoxy Adhesive DP920 has been developed with a combination of oil-absorb and oil displacement technology. "This 3M patented technology greatly reduces the time-consuming cleaning process that is commonly required for oily metal surfaces," said Meehan. "Upon application, the adhesive cuts through surface oil and cures at room temperature, saving both cleaning and energy costs while helping increase assembly operation efficiency.
Also, as a result of 3M's acquisition of EMFI S.A, a manufacturer of polyurethane-based structural adhesives and sealants headquartered in Haguenau, France, 3M introduced a full line of polyurethane sealants to the industrial market earlier in 2009. The products are ideally suited for industrial accounts who prefer polyurethane performance in bonding and sealing applications. Polyurethanes provide durability and flexibility in many harsh environments that can be found in construction, marine, transportation, energy and many other industrial applications.
On the DIY side, DAP has recently launched DAP 3.0 Advanced Sealants, a new family of sealants providing superior weather barrier protection, according to the company. Formulated with Kwik Dry Technology, DAP 3.0 can be exposed to water in three hours and won't wash out, versus the 24 hours some brands require. "Not only do they provide washout resistance and worry-free performance, DAP 3.0 also provides the benefits expected of a premium sealant to bring you the best of the best in sealant quality," said Fuller.
Side bar
AkzoNobel Industrial Finishes has acquired the wood adhesives activities of Kronochem, the chemical arm of Kronospan, a global producer of wood panels, MDF, chipboard, laminate flooring and board resins. The transaction includes a long-term tolling agreement under which Kronochem will utilize its manufacturing capacity and production expertise to produce wood adhesives for Casco Adhesives, a global producer of wood adhesives and a significant player in the board resin industry. Kronospan is already a toll manufacturing partner in Russia and China.
"This is a strategic bolt-on acquisition which will strengthen our portfolio in a key region and boost our technological capability," said Leif Darner, the AkzoNobel board member responsible for performance coatings. "Eastern Europe is a major production center for some of the biggest and most innovative furniture manufacturers and we can now strive for the productivity needed to prosper in this part of the world."
The acquired wood adhesives business is located in the Czech Republic, Romania, Bulgaria and Slovakia, an area regarded as a primary growth region for the future. Their products support applications for the furniture industry, including veneering, curved plywood, edge glue panel, doors, shuttering and three-layer boards. AkzoNobel's own European production for wood adhesives is centralized at two plants in Sweden.
Side bar
According to "Specialty Adhesives," a recently published study from The Freedonia Group, U.S. demand for specialty adhesives is projected to expand 4.4% annually to $3 billion in 2013, with volume reaching 705 million pounds. Overall demand will benefit from growth in durable goods output following a period of decline between 1998 and 2008. In terms of market volume, specialty adhesives are a small component of the overall adhesive industry, representing approximately five percent of U.S. adhesive demand in 2008. However, specialty adhesives are more significant with respect to market value, accounting for 28% of overall adhesive demand due to their relatively high prices. Among specialty adhesive product types, cyanoacrylates are expected to achieve the fastest gains in market value through 2013, due primarily to rapid growth in the medical field.
Manufacturing and assembly operations represent the largest major market for specialty adhesives, accounting for four-fifths of demand in 2008. Advances will be fueled by continued strong growth in the medical product market, where specialty adhesives find use in the manufacture of medical devices, transdermal patches and medical tape.
The automotive market will also drive gains as motor vehicle output rebounds from the significant declines of the 2003-2008 period.
The on-site construction market is forecast to increase rapidly through 2013, supported by accelerating construction activity. Specialty adhesives are used in both building and nonbuilding construction applications. Growth will be fueled by new housing activity, which is forecast to achieve double-digit annual gains as it rebounds from the significant declines of the 2003-2008 period.
Demand for specialty adhesives in other markets is expected to advance at an above-average rate through 2013. These applications encompass the use of specialty adhesives in automotive repair, construction repair and remodeling, and miscellaneous uses. The repair and remodeling segment will expand at a healthy rate, aided by an acceleration in home improvement and repair activity. However, growth in the automotive aftermarket will be limited by the improved outlook for motor vehicle sales, which will restrain automotive repair activity. Among miscellaneous uses, advances will be led by tissue adhesives, which will benefit from greater use in place of traditional wound closure methods.
The major markets for adhesives and sealants-transportation and construction-are down significantly, which of course has had a negative impact on many of the technology categories of adhesives and sealants, according to Steve Meehan, bonding business director, 3M industrial adhesives and tapes division. "There is also significant overcapacity in the industry, from suppliers to manufacturers to customers, so things will remain fiercely competitive during a recovery," he said. "The recession has given some relief on the availability of some raw materials, such as synthetic rubber, but depending on the rate of recovery, we could experience some shortages again in the near future."
Although certain major markets have stabilized somewhat, the demand being generated by major industrial customers remains significantly below the prior-year level. "The global reduction in manufacturing output among major industrial customers again significantly impacted the development of the specialty adhesives and surface treatment segment," said Christoph Schmidt, brand and business unit communications, adhesives technologies, Henkel. "This is particularly so in the case of the automotive and electronics sectors, and also the metals industry, with the associated markets having shrunken, in some cases, by up to 20%. The effects of the recession are particularly noticeable in Western Europe and North America."
According to David Fuller, vice president, marketing, DAP Products Inc, the biggest factor impacting the manufacture of adhesives and sealants has been the housing market. "The sale of existing homes has curtailed DIY and professional activity due to a slowdown in the turnover of homes," he said. "The National Association of Realtors indicates that sales of existing homes, in number of units, dropped from 6.5 million in 2006 to a seasonally adjusted rate of 5.1 million units at the end of August 2009 representing a 21% drop. This has a direct impact on our business considering our products are used in the preparation of putting a house up for sale as well as the changes a buyer makes to their new home after purchase."
In addition to the challenges of the economic downturn, adhesives and sealant manufacturers have had to contend with raw material prices. "Soft demand and overcapacity means that passing on any raw material cost increase to the end user customer is a difficult proposition," said Meehan. "Therefore, cost control is an absolute necessity to offset raw material and energy cost increases. Lean manufacturing practices and insourcing where there is available capacity are key components to our cost control programs."
Consumer segment offers growth opportunities
During tough economic times, consumers oftentimes put off hiring contractors for projects and opt instead to save money and to undertake these projects themselves.
"The DIY segment offers the most opportunity in this type of market," said Fuller. "Consumers may downgrade the size and cost of home improvement projects, but they will continue to invest into their homes because they wish to take care of and properly maintain them. In addition, DIYers and energy conscious homeowners represent an ideal audience to promote and educate the benefits related to home weatherization such as energy conservation and utility cost reduction."
"Within the adhesives business, the consumer-related segments such as adhesives for craftsmen and consumers, or packaging, consumer goods and construction adhesives exhibited more stability overall," said Schmidt.
The trend toward sustainability and lowering VOCs continues to pick up steam in the adhesive and sealants market. "VOC and related regulations continue to be implemented and expanded dictating manufacturers to formulate new and more environmentally friendly products," said Fuller. "We have taken a proactive approach and formulate products which exceed these expectations. A good example is our new DAP 3.0 Advanced Sealants that were formulated with virtually no VOCs."
"Sustainability is of great interest to customers who are looking for ways to reduce their carbon footprint," said Meehan. "It is more than just a decision between water-based adhesive versus solvent-based adhesives, however, as the term, 'sustainability,' can have many different meanings and interpretations. Some customers are interested in the overall impact from a Life Cycle Analysis point of view. It is still debatable, however, whether customers will pay more the more sustainable solution. Manufacturers of adhesives and sealants will have to consider sustainability issues in all new product development efforts going forward."
New adhesive & sealant technology
Royal Adhesives and Sealants LLC has launched new VOC compliant Silaprene Contact Adhesives. Silaprene low VOC Contact Adhesives are EPA compliant and customizable to meet the needs of its industrial customers. For use in the transportaion, assembly, foam and furniture, HVAC, recreational vehicles and marine industries, these new contact adhesives and cements contain less than 250 grams per liter of VOCs, compared to more than 600 grams per liter of VOCs in traditional solvent-based adhesives and cements.
"This new line of Silaprene brand low VOC adhesives and contact cements can be tailored to the application requirements of our customers without requiring large minimum orders which allows us to work with customers on all sizes of potential applications," said Ted Clark, CEO, Royal Adhesives and Sealants LLC. "Royal's experienced research and development department works closely with industrial customers to develop new products and modify existing products that will meet their needs for green strength, application times and physical properties."
Henkel's Macroplast UK 8340 is the first polyurethane adhesive to be certified by Germanisher Lloyd for bonding rotor blades for the wind power sector. "Wind turbines must perform reliably for a specified service life of 20 years without major repairs," said Schmidt. "And the rotor blades of large turbines have to satisfy especially stringent standards regarding fatigue strength. Conventionally, they are bonded together by using epoxy adhesives certified for this application by Germanischer Lloyd (GL). With Macroplast UK 8340, Henkel is now the first company to develop a GL-certified polyurethane adhesive for rotor-blade production."
Macroplast UK 8340 two-component system features rapid curing, which means considerable energy saving potential. It also features excellent wetting, which shortens time consuming and costly preliminary work such as sanding and laminating.
3M has introduced its latest technology in structural adhesives-3M Scotch-Weld Toughened Epoxy Adhesive DP920-designed for metal-to-metal bonding in agricultural equipment, appliances, elevator panels, construction equipment, specialty vehicles, trailers and a number of other applications. New 3M Scotch-Weld Toughened Epoxy Adhesive DP920 has been developed with a combination of oil-absorb and oil displacement technology. "This 3M patented technology greatly reduces the time-consuming cleaning process that is commonly required for oily metal surfaces," said Meehan. "Upon application, the adhesive cuts through surface oil and cures at room temperature, saving both cleaning and energy costs while helping increase assembly operation efficiency.
Also, as a result of 3M's acquisition of EMFI S.A, a manufacturer of polyurethane-based structural adhesives and sealants headquartered in Haguenau, France, 3M introduced a full line of polyurethane sealants to the industrial market earlier in 2009. The products are ideally suited for industrial accounts who prefer polyurethane performance in bonding and sealing applications. Polyurethanes provide durability and flexibility in many harsh environments that can be found in construction, marine, transportation, energy and many other industrial applications.
On the DIY side, DAP has recently launched DAP 3.0 Advanced Sealants, a new family of sealants providing superior weather barrier protection, according to the company. Formulated with Kwik Dry Technology, DAP 3.0 can be exposed to water in three hours and won't wash out, versus the 24 hours some brands require. "Not only do they provide washout resistance and worry-free performance, DAP 3.0 also provides the benefits expected of a premium sealant to bring you the best of the best in sealant quality," said Fuller.
Side bar
AkzoNobel acquires East European adhesives business
AkzoNobel Industrial Finishes has acquired the wood adhesives activities of Kronochem, the chemical arm of Kronospan, a global producer of wood panels, MDF, chipboard, laminate flooring and board resins. The transaction includes a long-term tolling agreement under which Kronochem will utilize its manufacturing capacity and production expertise to produce wood adhesives for Casco Adhesives, a global producer of wood adhesives and a significant player in the board resin industry. Kronospan is already a toll manufacturing partner in Russia and China.
"This is a strategic bolt-on acquisition which will strengthen our portfolio in a key region and boost our technological capability," said Leif Darner, the AkzoNobel board member responsible for performance coatings. "Eastern Europe is a major production center for some of the biggest and most innovative furniture manufacturers and we can now strive for the productivity needed to prosper in this part of the world."
The acquired wood adhesives business is located in the Czech Republic, Romania, Bulgaria and Slovakia, an area regarded as a primary growth region for the future. Their products support applications for the furniture industry, including veneering, curved plywood, edge glue panel, doors, shuttering and three-layer boards. AkzoNobel's own European production for wood adhesives is centralized at two plants in Sweden.
Side bar
U.S. demand for adhesives to reach $3 billion in 2013
According to "Specialty Adhesives," a recently published study from The Freedonia Group, U.S. demand for specialty adhesives is projected to expand 4.4% annually to $3 billion in 2013, with volume reaching 705 million pounds. Overall demand will benefit from growth in durable goods output following a period of decline between 1998 and 2008. In terms of market volume, specialty adhesives are a small component of the overall adhesive industry, representing approximately five percent of U.S. adhesive demand in 2008. However, specialty adhesives are more significant with respect to market value, accounting for 28% of overall adhesive demand due to their relatively high prices. Among specialty adhesive product types, cyanoacrylates are expected to achieve the fastest gains in market value through 2013, due primarily to rapid growth in the medical field.
The automotive market will also drive gains as motor vehicle output rebounds from the significant declines of the 2003-2008 period.
The on-site construction market is forecast to increase rapidly through 2013, supported by accelerating construction activity. Specialty adhesives are used in both building and nonbuilding construction applications. Growth will be fueled by new housing activity, which is forecast to achieve double-digit annual gains as it rebounds from the significant declines of the 2003-2008 period.
Demand for specialty adhesives in other markets is expected to advance at an above-average rate through 2013. These applications encompass the use of specialty adhesives in automotive repair, construction repair and remodeling, and miscellaneous uses. The repair and remodeling segment will expand at a healthy rate, aided by an acceleration in home improvement and repair activity. However, growth in the automotive aftermarket will be limited by the improved outlook for motor vehicle sales, which will restrain automotive repair activity. Among miscellaneous uses, advances will be led by tissue adhesives, which will benefit from greater use in place of traditional wound closure methods.
