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    Europe Reports

    European Coatings Show Attendees are Optimistic About the Future

    An underlying theme of the latest exhibition was the economic and financial sustainability of individual companies.

    Sean Milmo, European Correspondent04.01.13
    The European Coatings Show (ECS) took place in March 2013 in Nuremberg, Germany, at a time of continued static demand in the European Union’s coating market.

    The exhibition and the congress that was held at the same time is one of the world’s largest international coatings events, and had an air of optimism. The European coatings sector is undergoing changes that are putting it in a good position to benefit from any recovery in the EU’s embattled economy.

    There are speciality niches with strong growth prospects, a lot of new raw materials and formulations, novel functional and smart coatings, new emerging players among both coatings producers and raw material suppliers and evidence of rising productivity, making the sector more internationally competitive.

    Above all, a great effort has been made over the last few years to forge closer ties along the supply chain with raw material suppliers, paint makers and their customers, having a greater understanding of each other’s problems and needs.

    There has been much technological innovation stemming from development work started soon after the 2008 financial crisis in the expectation that the best time to launch new products would be during the recovery. However, there has also been a lot of innovation in services as well as companies continue to extend their activities beyond manufacturing.

    As in the last few bi-annual European Coatings Shows, great prominence has been given to environmental sustainability. An additional impetus behind the development of eco-friendly products has been the pressure for regulatory compliance.

    This is particularly the case with the EU chemicals regulation REACH, which obliges companies to register with safety profiles their chemicals, with the more hazardous ones being subject to separate, detailed evaluation and ultimately, if necessary, authorization to stay on the market.

    Customers are anxious to know whether raw materials and ingredients in formulations are liable to be restricted under REACH by being classified as substances of very high concern (SVHC). Chemicals for authorization are selected from the SVHC list, which currently numbers around 140 but is due to be at least tripled over the next few years.

    “Regulations like REACH are forcing us to change products to ensure that they don’t contain substances which are or may not be environmentally acceptable,” said Gregory Delmas, application group manager at Arkema. “Customers also don’t want to have to put warning signs on their product labels about hazardous chemicals either because of REACH or eco-label schemes.”

    Arkema won the European Coatings technology award for 2013 at the show for its Encor 2433 waterborne dispersion technology, which enables direct-to-metal application of coatings with quick air-drying times and low emissions of volatile organic compounds (VOCs).

    Also, there was plenty of evidence at the show that the momentum behind the switch to biomaterials is still strong. This has been due to regulatory influences, and also the desire among end-users such as brand owners and retail chain for “green” formulations.

    Petrochemical-derived chemicals are being targeted by producers of bio-based alternatives who believe they have products that can perform as well or even better.

    “We are finding for example that there is a lot of interest among customers in bio-substitutes for synthetic latex because of worries about its health effects and odor,” said Stefan Krause, industrial account manager for Avebe, a Dutch potato starch producer. “Starch is a good source for biomaterials for alternatives to latex and other chemicals. We believe that the next 10 years will be boom period for starch.”

    The Importance Of Sustainability

    An underlying theme of the latest exhibition was the economic and financial sustainability of individual companies with exhibitors anxious to demonstrate how well they have been coping in the tough times of a persistent euro crisis, high unemployment and public sector austerity.

    The total of 962 exhibitors at this year’s ECS, which had more than 25,000 visitors, was a record for its 22-year history, while the number of non-German exhibitors at 615, or just under two-thirds, was also the highest ever.

    China was the second highest national exhibitor after Germany, with a total of 115, followed by The Netherlands with 56 and the UK with 46.

    “Some Chinese companies are not interested in the market in Europe any more because of the state of the economy in the region,” said Anne Kong, Europe trade manager at Yipin Pigments Co. Ltd., Shanghai. “We want to grow in Europe and expand our network of distributors. We have to show our presence in the market.”

    For non-European companies establishing themselves in the region, the big challenge is building and maintaining ties with customers. This involves not just making single but multiple contacts with companies.

    “It is no longer sufficient to know the purchasing and R&D managers,” explained Phil Ruxton, vice president sales and marketing for coatings and polymers at Croda Europe. “You’ve got to know the marketing and sales managers, preferably the whole management team, if you are to understand the needs of customers while also helping them understand the full value of your products.”

    At a time of economic difficulties, relationships with customers are strengthened if raw material suppliers and coatings producers can help find ways of curbing downstream costs.

    “In current economic conditions with their margins under pressure, costs are the big issue with customers,” said Jan Weernink, responsible for European industrial marketing at Dow Coating Materials. “The current focus of our customers is to manage cost, and they are working on products to achieve the same performance but at a lower cost. So a thinner film in a coating must perform in the same way as the original one. Presently innovation is strongly being driven by the need for lower cost: raw material cost, cost in use and ownership”

    Dow has recently introduced a waterborne road marking paint, which a life cycle assessment confirmed had a lower environmental impact than solvent-borne paints in the same market. Also, in terms of application costs it is cheaper, which has made it especially attractive to municipalities hit by government austerity measures.

    “Austerity in the public sector has helped us to introduce a new technology for waterborne road paint,” Weernink said. “Paint with this new technology is competing against solvent-borne paints and can be applied once every two years instead of once a year with the solventborne version. This need for fewer coats and thus cost is welcome to municipalities that are looking for cost savings.”

    Differentiation of their products and services was what most exhibitors were trying to convey to visitors to their stands at the exhibition. This urge for distinctiveness even extended to the ways company personnel at the ECS communicated with existing or potential customers.

    DSM Coating Resins had a stand around the size of a medium-sized kitchen, far smaller than at previous ECS exhibitions. The stand acted as a conduit for visitors to talk to DSM staff in private rooms adjacent to the exhibition halls.

    “We thought that people would be more comfortable talking to our staff in separate rooms where they would have a level of privacy not available on an exhibition stand,” said a DSM official. 

    DSM’s change of approach indicated the priority now being given by raw material suppliers and other players in the coating sector to putting relations with customers on firmer foundations at a time of economic uncertainties.
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