Kerry Pianoforte05.09.11
The marine coatings market has shown some signs of recovering from the economic downturn of the last few years. As ship owners and builders begin to regain some confidence in the economy, shipbuilding and the repair and maintenance sectors have begun to slowly return to pre-recession levels.
“The global marine coatings market started recovering from the economic downturn during 2010 and we can expect continued improvement throughout 2011 and 2012,” said Steve Dickey, market director, global marine, Sherwin-Williams Protective and Marine Coatings. “The economic crisis impacted the maintenance and repair (M&R) sector significantly, but it is beginning to recover now. Sea stocks are also recovering. Global new builds are expected to decline from 2011-2013, but should recover by 2014.”
The market has been growing steadily in recent years, driven by strong activity in the shipping industry. “Shipping went through an unprecedented boom in 2006-2008, where vessel owners were making good returns and a record number of ships were ordered,” said Paul Westcott, commercial director, International Paint Marine and Protective Coatings. “Since it can take several years for a ship to be built, coated and delivered from the point when the original contract is signed, the newbuilding shipbuilding market continued to grow, despite the global economic recession.” A reduction in demand for maintenance and repair coatings however, is a result of the global recession as vessel owners suffering intense competition and lower freight rates have attempted to reduce costs.
According to Westcott, although the shipping industry is historically volatile, the marine coatings market overall held up well in 2010. “It is expected that the market for newbuilding coatings has now peaked and will begin to shrink over the next few years, but with the largest fleet of in-service vessels that the industry has ever seen, the maintenance and repair market will inevitably pick up and may go some way to compensate for the reduction in newbuilding volumes,” he said.
A volatile market
While marine coatings manufacturers expressed cautious optimism for recovery from the economic downturn, raw material prices continue to negatively affect the marine coatings market.
“The market was characterized by great optimism the first half of 2010,” said Tom Evensen, group category manager antifouling, Jotun Coatings. “In the second half it dropped rapidly due to increasing raw material prices which started to inhibit a sound profitability for the coatings industry. In 2010 more than 2,000 new-builds were contracted. Today’s general market is anxious due to the overcapacity of tonnage in the market. The expectations for 2011 are worse than for 2009-2010.”
Evensen also noted that unrest in North Africa and the Middle East heavily influenced the price of oil and local demand in these regions. “Another factor that plays a vital role in terms of the reduced profitability, within the marine coatings industry, is the fact that several of the major players increased their production capacity and number of staff during the boom of 2001-2008,” he said. “This has led to a market which is far more competitive in terms of pricing and thus, inhibiting a sound profitability.”
Raw materials key to the manufacture of both marine and protective coatings products have been affected by inflationary drivers including epoxy resins, titanium dioxide, solvents, copper and other metals. “We have attempted to minimize the impact on our customers for as long as possible by leveraging our buying power and driving internal cost saving measures,” said Westcott. “Unfortunately the increase in raw material costs shows no sign of abatement and therefore regrettably we now have little choice but to initiate a program of product price rises.”
The rise in raw material costs no doubt is a significant challenge for the global marine coatings market. “Raw materials such as epoxy resins and TiO2 used in ballast tank coatings and topside systems have risen significantly over the last year and are predicted to go even higher throughout 2011 and 2012,” said Dickey. “Also, the price of copper is at or near record highs, having nearly doubled over the past years, and that will affect antifouling paint costs.
“Overall, in view of these increases in costs and rising oil and fuel prices, our view is that coatings costs will continue to rise and may have to increase significantly in the short term,” Dickey continued.
Asia Pacific dominates the global market
Despite the obstacles presented by raw material costs and price increases, marine coatings manufacturers are looking to the Asia Pacific region for growth opportunities. This region remains the leader in terms of marine coatings consumption.
“Asia was the leader before the downturn and is now to an even greater degree the largest and most active region for marine coatings,” said Dickey. “With China, South Korea and Japan representing nearly 80 percent of the world’s newbuilding capacity and China now leading in the number of drydocks and drydocking, Asia is growing two or three times more than any other region.
“In our view, the recent global economic rebound is responsible for growth in marine coatings in Asia, the U.S. and Europe,” Dickey continued. “The Asian economy is nearly back to pre-recession levels and Brazil is experiencing significant growth in response to increased activity in the petrochemical and mining segments.
Evensen said increased growth in BRICK countries (Brazil, India, China and South Korea) is the key trend in the marine coatings market. “The main regions in terms of where the coatings are actually applied are China, South Korea and Japan,” he said. “This is mainly due to the huge numbers of new building and also dry dockings in those countries. Several of the major yards have started to diversify to a higher extent and not take on new types of projects such as modules for the oil and gas industries. In addition, there are certain areas that due to their strategic locations play a vital role. These places include Singapore, Amsterdam, Dubai, the Suez Canal area and so forth.”
According to Westcott, the outlook for the shipping market in 2011 is mixed. “Analysts are bullish on container trade, while less confident in a dry bulk market that has started the year poorly,” he said. “Geographical mix also plays a part. Asian economies are already returning to strong growth, while the U.S. is recovering gradually, but European growth remains weak.”
Although it is difficult to predict what the future holds for the marine coatings industry, manufacturers have focused on delivering innovative products that will help their customers maintain their bottom line, while delivering performance and environmental compliance.
SeaQuantum X200 is Jotun’s latest development in tin-free high performance self-polishing antifouling technology, based on the latest development in hydrolyzing silyl methacrylate copolymers. According to the company, this copolymer dissolves in seawater at a rate permitting the continuous exposure of fresh antifouling and minimizing build up of leached layers. As a result, the product secures long-term fuel performance by maintaining a smooth surface free of fouling.
Jotun recently announced findings from a three-year study involving SeaQuantum X200. “Jotun has developed the monitoring tools and analysis method to prove SeaQuantum X200’s ability to dramatically lower fuel costs over time,” said Evensen. “By using sensors to capture information from different data points, Jotun has a basis to calculate fuel savings over time. Based on this data, Jotun can offer Hull Performance Solutions customers a guarantee that SeaQuantum X200 will provide a clean hull and less than 1.5 percent speed loss or maximum 4.5 percent increase in fuel consumption over 60 months, compared to the condition of the vessel after dry-dock. Either we deliver on high performance, or we return the additional investment in SeaQuantum X200.”
Sherwin-Williams offers a number of innovative products for the marine coatings industry. SeaVoyage Copper Free is its latest introduction to the marine coatings industry.
This copper free antifoulant is designed for long-term service and deters both soft and hard fouling.
Also in Sherwin-Williams’ portfolio is Euronavy ES301, which can be applied with no dew point restrictions over damp steel surfaces and over flash-rust, reducing application time and costs. Coating can occur immediately after hydroblasting or other water preparation methods without drying. Euronavy ES301 also features good edge retention, low VOC and is HAPS-free.
Another product is Sher-Release, a foul release two-coat coating system that creates long-term serviceability and fuel savings for large ships, according to the company. Lastly, Fast Clad ER is a 100 percent solids epoxy amine coating for immersion service in seawater ballast tanks. It features a rapid return to service, low VOC levels and good edge retention.
International Paint, an AkzoNobel company, introduced a number of new products in 2010. First it launched a new range of universal primers for the newbuilding market to address the productivity, regulatory, performance and commercial needs of shipyards and ship owners alike. “Ship builders and owners can now better choose how they meet productivity and performance targets and comply with the International Maritime Organization’s Performance Standard for Protective Coatings (PSPC) and new regional regulations limiting VOC emissions, such as the EU’s Solvents Emissions Directive,” said Westcott.
Intershield 803 Plus is a new cargo hold coating specifically designed to address the key issue of impact damage from the loading of dry bulk cargoes. Intershield 803 Plus delivers impact resistance and provides general abrasion resistance, corrosion protection, VOC compliance with 75 percent volume solids, fast drying times and all year round workability. The product has a smooth surface for easy cleaning, is certified for the carriage of grain and is FDA compliant.
International has also expanded its range of biocidal antifouling coatings. The enhanced line up includes higher volume solids products, meaning reduced coats per scheme, lower levels of overspray and reduced VOC emissions. The new range will help ship owners, operators and ship yards meet the challenges of fluctuating fuel costs and increasing environmental pressures by delivering a full range of operational cost, environment and in-service performance benefits, according to the firm.
The new range features its highest-performing self-polishing copolymer antifouant, Intersmooth SPC; its economical option Interspeed; and a blend of both technologies in the new Interswift products.
Lastly, International Paints’ Intersmooth 7460HS SPC and Intersmooth 7465HS SPC pure hydrolyzing self-polishing copolymer antifoulings for deep-sea vessels feature high volume solids and low VOCs. Copper acrylate technology delivers controlled chemical dissolution of the paint film, which ensures continued smoothing over long dry docking intervals. Predictable polishing enables specifications to be tailored to specific ship types and operational profiles, while thin leached layers allow simple cleaning and recoating at dry dockings. Intersmooth 7460HS SPC and Intersmooth 7465HS SPC provide fouling control for up to 60 months and share in the proven track record of Intersmooth SPC on over 15,000 vessels worldwide. The alternative Intersmooth 360 SPC and Intersmooth 365 SPC variants are specially designed for coastal vessels.
“The global marine coatings market started recovering from the economic downturn during 2010 and we can expect continued improvement throughout 2011 and 2012,” said Steve Dickey, market director, global marine, Sherwin-Williams Protective and Marine Coatings. “The economic crisis impacted the maintenance and repair (M&R) sector significantly, but it is beginning to recover now. Sea stocks are also recovering. Global new builds are expected to decline from 2011-2013, but should recover by 2014.”
The market has been growing steadily in recent years, driven by strong activity in the shipping industry. “Shipping went through an unprecedented boom in 2006-2008, where vessel owners were making good returns and a record number of ships were ordered,” said Paul Westcott, commercial director, International Paint Marine and Protective Coatings. “Since it can take several years for a ship to be built, coated and delivered from the point when the original contract is signed, the newbuilding shipbuilding market continued to grow, despite the global economic recession.” A reduction in demand for maintenance and repair coatings however, is a result of the global recession as vessel owners suffering intense competition and lower freight rates have attempted to reduce costs.
According to Westcott, although the shipping industry is historically volatile, the marine coatings market overall held up well in 2010. “It is expected that the market for newbuilding coatings has now peaked and will begin to shrink over the next few years, but with the largest fleet of in-service vessels that the industry has ever seen, the maintenance and repair market will inevitably pick up and may go some way to compensate for the reduction in newbuilding volumes,” he said.
A volatile market
While marine coatings manufacturers expressed cautious optimism for recovery from the economic downturn, raw material prices continue to negatively affect the marine coatings market.
“The market was characterized by great optimism the first half of 2010,” said Tom Evensen, group category manager antifouling, Jotun Coatings. “In the second half it dropped rapidly due to increasing raw material prices which started to inhibit a sound profitability for the coatings industry. In 2010 more than 2,000 new-builds were contracted. Today’s general market is anxious due to the overcapacity of tonnage in the market. The expectations for 2011 are worse than for 2009-2010.”
Evensen also noted that unrest in North Africa and the Middle East heavily influenced the price of oil and local demand in these regions. “Another factor that plays a vital role in terms of the reduced profitability, within the marine coatings industry, is the fact that several of the major players increased their production capacity and number of staff during the boom of 2001-2008,” he said. “This has led to a market which is far more competitive in terms of pricing and thus, inhibiting a sound profitability.”
Raw materials key to the manufacture of both marine and protective coatings products have been affected by inflationary drivers including epoxy resins, titanium dioxide, solvents, copper and other metals. “We have attempted to minimize the impact on our customers for as long as possible by leveraging our buying power and driving internal cost saving measures,” said Westcott. “Unfortunately the increase in raw material costs shows no sign of abatement and therefore regrettably we now have little choice but to initiate a program of product price rises.”
The rise in raw material costs no doubt is a significant challenge for the global marine coatings market. “Raw materials such as epoxy resins and TiO2 used in ballast tank coatings and topside systems have risen significantly over the last year and are predicted to go even higher throughout 2011 and 2012,” said Dickey. “Also, the price of copper is at or near record highs, having nearly doubled over the past years, and that will affect antifouling paint costs.
“Overall, in view of these increases in costs and rising oil and fuel prices, our view is that coatings costs will continue to rise and may have to increase significantly in the short term,” Dickey continued.
Asia Pacific dominates the global market
Despite the obstacles presented by raw material costs and price increases, marine coatings manufacturers are looking to the Asia Pacific region for growth opportunities. This region remains the leader in terms of marine coatings consumption.
“Asia was the leader before the downturn and is now to an even greater degree the largest and most active region for marine coatings,” said Dickey. “With China, South Korea and Japan representing nearly 80 percent of the world’s newbuilding capacity and China now leading in the number of drydocks and drydocking, Asia is growing two or three times more than any other region.
“In our view, the recent global economic rebound is responsible for growth in marine coatings in Asia, the U.S. and Europe,” Dickey continued. “The Asian economy is nearly back to pre-recession levels and Brazil is experiencing significant growth in response to increased activity in the petrochemical and mining segments.
Evensen said increased growth in BRICK countries (Brazil, India, China and South Korea) is the key trend in the marine coatings market. “The main regions in terms of where the coatings are actually applied are China, South Korea and Japan,” he said. “This is mainly due to the huge numbers of new building and also dry dockings in those countries. Several of the major yards have started to diversify to a higher extent and not take on new types of projects such as modules for the oil and gas industries. In addition, there are certain areas that due to their strategic locations play a vital role. These places include Singapore, Amsterdam, Dubai, the Suez Canal area and so forth.”
According to Westcott, the outlook for the shipping market in 2011 is mixed. “Analysts are bullish on container trade, while less confident in a dry bulk market that has started the year poorly,” he said. “Geographical mix also plays a part. Asian economies are already returning to strong growth, while the U.S. is recovering gradually, but European growth remains weak.”
Although it is difficult to predict what the future holds for the marine coatings industry, manufacturers have focused on delivering innovative products that will help their customers maintain their bottom line, while delivering performance and environmental compliance.
SeaQuantum X200 is Jotun’s latest development in tin-free high performance self-polishing antifouling technology, based on the latest development in hydrolyzing silyl methacrylate copolymers. According to the company, this copolymer dissolves in seawater at a rate permitting the continuous exposure of fresh antifouling and minimizing build up of leached layers. As a result, the product secures long-term fuel performance by maintaining a smooth surface free of fouling.
Jotun recently announced findings from a three-year study involving SeaQuantum X200. “Jotun has developed the monitoring tools and analysis method to prove SeaQuantum X200’s ability to dramatically lower fuel costs over time,” said Evensen. “By using sensors to capture information from different data points, Jotun has a basis to calculate fuel savings over time. Based on this data, Jotun can offer Hull Performance Solutions customers a guarantee that SeaQuantum X200 will provide a clean hull and less than 1.5 percent speed loss or maximum 4.5 percent increase in fuel consumption over 60 months, compared to the condition of the vessel after dry-dock. Either we deliver on high performance, or we return the additional investment in SeaQuantum X200.”
Sherwin-Williams offers a number of innovative products for the marine coatings industry. SeaVoyage Copper Free is its latest introduction to the marine coatings industry.
This copper free antifoulant is designed for long-term service and deters both soft and hard fouling.
Also in Sherwin-Williams’ portfolio is Euronavy ES301, which can be applied with no dew point restrictions over damp steel surfaces and over flash-rust, reducing application time and costs. Coating can occur immediately after hydroblasting or other water preparation methods without drying. Euronavy ES301 also features good edge retention, low VOC and is HAPS-free.
Another product is Sher-Release, a foul release two-coat coating system that creates long-term serviceability and fuel savings for large ships, according to the company. Lastly, Fast Clad ER is a 100 percent solids epoxy amine coating for immersion service in seawater ballast tanks. It features a rapid return to service, low VOC levels and good edge retention.
International Paint, an AkzoNobel company, introduced a number of new products in 2010. First it launched a new range of universal primers for the newbuilding market to address the productivity, regulatory, performance and commercial needs of shipyards and ship owners alike. “Ship builders and owners can now better choose how they meet productivity and performance targets and comply with the International Maritime Organization’s Performance Standard for Protective Coatings (PSPC) and new regional regulations limiting VOC emissions, such as the EU’s Solvents Emissions Directive,” said Westcott.
Intershield 803 Plus is a new cargo hold coating specifically designed to address the key issue of impact damage from the loading of dry bulk cargoes. Intershield 803 Plus delivers impact resistance and provides general abrasion resistance, corrosion protection, VOC compliance with 75 percent volume solids, fast drying times and all year round workability. The product has a smooth surface for easy cleaning, is certified for the carriage of grain and is FDA compliant.
International has also expanded its range of biocidal antifouling coatings. The enhanced line up includes higher volume solids products, meaning reduced coats per scheme, lower levels of overspray and reduced VOC emissions. The new range will help ship owners, operators and ship yards meet the challenges of fluctuating fuel costs and increasing environmental pressures by delivering a full range of operational cost, environment and in-service performance benefits, according to the firm.
The new range features its highest-performing self-polishing copolymer antifouant, Intersmooth SPC; its economical option Interspeed; and a blend of both technologies in the new Interswift products.
Lastly, International Paints’ Intersmooth 7460HS SPC and Intersmooth 7465HS SPC pure hydrolyzing self-polishing copolymer antifoulings for deep-sea vessels feature high volume solids and low VOCs. Copper acrylate technology delivers controlled chemical dissolution of the paint film, which ensures continued smoothing over long dry docking intervals. Predictable polishing enables specifications to be tailored to specific ship types and operational profiles, while thin leached layers allow simple cleaning and recoating at dry dockings. Intersmooth 7460HS SPC and Intersmooth 7465HS SPC provide fouling control for up to 60 months and share in the proven track record of Intersmooth SPC on over 15,000 vessels worldwide. The alternative Intersmooth 360 SPC and Intersmooth 365 SPC variants are specially designed for coastal vessels.
