Shem Oirere, Africa Correspondent07.05.17
The second East African Coatings Congress (EACC) 2017 concluded in Kenya’s capital Nairobi on June 14 with participating companies expressing optimism the event would enable them to penetrate the region’s paints and coatings market while some, especially the Africa-based, calling for a new taxation structure across the continent’s regional trading blocs to promote fair competition.
More than 20 companies participated in the exhibition, which was held alongside the regional Congress that brought together coatings professionals who also heard key presentations from specialists of various companies and organizations in the global chemicals and minerals sector.
“With the region thriving as the sub-Saharan middle class grows, there has never been a better opportunity for this market sector to invest in the future of this area with the paints and coatings market expected to increase to around 1.7Mt by 2018,” said Ian Faux, vice president the London-based dmg events (MEA) Ltd, the organizer of the Congress held at the expansive Safari Park Hotel, the same venue for the inaugural EACC in 2016.
Foreign companies with no existing distributor or agent network in East Africa were optimistic of striking new ties with local firms that have the potential to increase their product volumes in the market.
“Although we do not have a distributor in the Eastern Africa region, the Congress provides an opportunity for us to demonstrate to customers and potential partners what we are doing and what range of products we are offering in the market,” said Ursula Golling, marketing manager of Germany-based Hoffmann Minerals.
She said Hoffmann currently does direct sales to consumers in East Africa but added “we hope we can be successful in getting useful contacts as it happened in 2008 when we got our current Middle East distributor at a similar event.”
Hoffmann Minerals is the manufacturer of neuburg siliceous earth, which it says is a mineral functional filler that is a combination of kaolinite and silica used for various coating applications. The product goes under different trade names such as Sillitin, Sillikollod, Aktisil, Silfit and Aktifit.
For Dubai-based Horizon Chemicals Trading LLC, the EACC was an opportunity to meet and discuss business with East Africa paint and coatings companies which have been key consumers of its chemicals.
“We supply almost all paint and coatings companies in East Africa and hence our participation in the Congress creates an opportunity for us to not only interact with them but also hear from potential buyers of our products in this market,” said Michael Nashed, the company’s export manager.
He said Horizon Chemicals, which is currently striving to be a one-stop-shop for all high quality industrial chemical products, expects that after the EACC the company “would have met its customers in East Africa and also use the event for its own business development.”
Although the company is currently selling directly to paints and coatings companies in East Africa, its products have gained traction in Tanzania, Kenya, Sudan, Uganda and Madagascar.
The EACC event according to Robert Gardien, key account manager Europe West for Mondo Minerals B.V. is “an open game for international companies that are seeking business opportunities in East Africa.”
“We should get a better understanding of the African market after the two-day event,” said Gardien, whose company is more active in the Moroccan market but which he said, is open to the embracing of business opportunities emerging in sub Saharan Africa.
East and Central Africa’s biggest manufacturer of synthetic resins, Synresins Ltd., was one of the regional market players at the exhibition and took the opportunity to demonstrate how the company is diversifying its range of products to mitigate the effects of increasing competition that has intensified particularly from cheap products from Egypt.
“The Egyptian market is highly subsidized and when the products are exported to East Africa, the exporters benefit from the existing Common Market for Eastern and Southern Africa (Comesa) tariff policy that makes the exports cheaper than those produced locally,” said Leonard Sang, Synresins Ltd.’s Research and Development Manager.
Egypt is one of the 20 Comesa member countries that have formed a free trade area that exempt exports and imports from partner States from any custom duty levy at entry points.
“Being a Kenyan-based company with operations in East and Central Africa, we pay taxes for our local production and there are no manufacturing subsidies as is the case in Egypt which makes the competition a bit skewed,” he said.
He said Synresins, which produces both water- and solvent-based and also specialized resins for use in the paint, coatings, ink, textile, automotive and adhesive industries, gets its raw materials from global majors such as Dow and BASF.
“But we still have unknown suppliers that are active in the market which affects the pricing of the products,” he said.
“Synresins is putting emphasis on research and development as we diversify into additional value chains as a strategy to address the competition,” said Sang.
Pricing is a factor in the performance of many coatings industry related companies that participated in the EACC such as the London-based Elementis which makes commodity and specialty chromium products useful in the business of paints and coatings such as chromic acid, chromic oxide, sodium chromate and chrome hydrate.
In the company’s latest performance report, the CEO Paul Waterman said Elementis is “implementing price increases to protect our margins.”
He said at the end of 2016 the price of raw materials relied on by Elementis rose significantly impacting on the production of the company’s variety of rheology modifiers and specialty additives for the decorative and industrial paints and coatings.
South Africa’s Beckers Group, a subsidiary of the Sweden-based Lindéngruppen AB, which produces industrial coatings, artist’s materials, and metal powders, expects to sign a partnership with a couple of companies in Kenya in coming months to position itself for a share of the growing East African market.
“Currently we import products for sale in East Africa but we are about to conclude negotiations on a partnership with a few local companies and which we think would raise our profile in this region’s market,” said Godfrey Somo, Beckers sales and marketing representative for East Africa.
He said being a South Africa exporter of paints and coatings formulation products, “we have been so much disadvantaged because South Africa is not a member of Comesa that allows exemption of taxes on our imports. So our products are fairly high priced to cater for the import taxes.”
“Discussions are ongoing to have South Africa admitted as a member of Comesa and we think if this happens then it would boost our position in the East African market although we are slowly shifting to provision of technical services as opposed to importation and sale of products,” he said.
“Our focus now is to get a few partners in East Africa who would handle the export/import part of the partnership as Becker uses its more than 150 years’ experience to scale up technical services in the paints and coatings industry related segment,” said Somo.
Germany-based dispersion systems manufacturer Vma Getzmann GbmH looks to exploit its reputation as a supplier of quality equipment for the paints and coatings industry to sustain its market share in Africa despite some competition from competitors especially from Asia.
“Our brand is associated with quality and we intend to sustain the reputation by supplying high quality innovative equipment and strengthening the relationship with existing users of our products,” said Mathias Lehnert, the company’s sales director for Africa.
VMA, which manufactures Dispermat and Torusmill that the company says “are highly efficient dissolvers, beadmills and basket mills” hopes to sustain its market position by offering not only latest technology equipment but also quality after sales service.
“Some of our competitors have supplied equipment that breaks down in under one year and this has been an advantage to VMA because our products have a life span of more than 25 years and we are promising customers they will need servicing of the equipment at least after three years,” said David Karanja, managing director of Crane Consulting House, that has partnered with VMA in Kenya.
Subsequent EACC events will henceforth be held after every two years according to Kieran Proverbs dmg events marketing manager. “Our next EACC will be held in 2019,” said Proverbs.
More than 20 companies participated in the exhibition, which was held alongside the regional Congress that brought together coatings professionals who also heard key presentations from specialists of various companies and organizations in the global chemicals and minerals sector.
“With the region thriving as the sub-Saharan middle class grows, there has never been a better opportunity for this market sector to invest in the future of this area with the paints and coatings market expected to increase to around 1.7Mt by 2018,” said Ian Faux, vice president the London-based dmg events (MEA) Ltd, the organizer of the Congress held at the expansive Safari Park Hotel, the same venue for the inaugural EACC in 2016.
Foreign companies with no existing distributor or agent network in East Africa were optimistic of striking new ties with local firms that have the potential to increase their product volumes in the market.
“Although we do not have a distributor in the Eastern Africa region, the Congress provides an opportunity for us to demonstrate to customers and potential partners what we are doing and what range of products we are offering in the market,” said Ursula Golling, marketing manager of Germany-based Hoffmann Minerals.
She said Hoffmann currently does direct sales to consumers in East Africa but added “we hope we can be successful in getting useful contacts as it happened in 2008 when we got our current Middle East distributor at a similar event.”
Hoffmann Minerals is the manufacturer of neuburg siliceous earth, which it says is a mineral functional filler that is a combination of kaolinite and silica used for various coating applications. The product goes under different trade names such as Sillitin, Sillikollod, Aktisil, Silfit and Aktifit.
For Dubai-based Horizon Chemicals Trading LLC, the EACC was an opportunity to meet and discuss business with East Africa paint and coatings companies which have been key consumers of its chemicals.
“We supply almost all paint and coatings companies in East Africa and hence our participation in the Congress creates an opportunity for us to not only interact with them but also hear from potential buyers of our products in this market,” said Michael Nashed, the company’s export manager.
He said Horizon Chemicals, which is currently striving to be a one-stop-shop for all high quality industrial chemical products, expects that after the EACC the company “would have met its customers in East Africa and also use the event for its own business development.”
Although the company is currently selling directly to paints and coatings companies in East Africa, its products have gained traction in Tanzania, Kenya, Sudan, Uganda and Madagascar.
The EACC event according to Robert Gardien, key account manager Europe West for Mondo Minerals B.V. is “an open game for international companies that are seeking business opportunities in East Africa.”
“We should get a better understanding of the African market after the two-day event,” said Gardien, whose company is more active in the Moroccan market but which he said, is open to the embracing of business opportunities emerging in sub Saharan Africa.
East and Central Africa’s biggest manufacturer of synthetic resins, Synresins Ltd., was one of the regional market players at the exhibition and took the opportunity to demonstrate how the company is diversifying its range of products to mitigate the effects of increasing competition that has intensified particularly from cheap products from Egypt.
“The Egyptian market is highly subsidized and when the products are exported to East Africa, the exporters benefit from the existing Common Market for Eastern and Southern Africa (Comesa) tariff policy that makes the exports cheaper than those produced locally,” said Leonard Sang, Synresins Ltd.’s Research and Development Manager.
Egypt is one of the 20 Comesa member countries that have formed a free trade area that exempt exports and imports from partner States from any custom duty levy at entry points.
“Being a Kenyan-based company with operations in East and Central Africa, we pay taxes for our local production and there are no manufacturing subsidies as is the case in Egypt which makes the competition a bit skewed,” he said.
He said Synresins, which produces both water- and solvent-based and also specialized resins for use in the paint, coatings, ink, textile, automotive and adhesive industries, gets its raw materials from global majors such as Dow and BASF.
“But we still have unknown suppliers that are active in the market which affects the pricing of the products,” he said.
“Synresins is putting emphasis on research and development as we diversify into additional value chains as a strategy to address the competition,” said Sang.
Pricing is a factor in the performance of many coatings industry related companies that participated in the EACC such as the London-based Elementis which makes commodity and specialty chromium products useful in the business of paints and coatings such as chromic acid, chromic oxide, sodium chromate and chrome hydrate.
In the company’s latest performance report, the CEO Paul Waterman said Elementis is “implementing price increases to protect our margins.”
He said at the end of 2016 the price of raw materials relied on by Elementis rose significantly impacting on the production of the company’s variety of rheology modifiers and specialty additives for the decorative and industrial paints and coatings.
South Africa’s Beckers Group, a subsidiary of the Sweden-based Lindéngruppen AB, which produces industrial coatings, artist’s materials, and metal powders, expects to sign a partnership with a couple of companies in Kenya in coming months to position itself for a share of the growing East African market.
“Currently we import products for sale in East Africa but we are about to conclude negotiations on a partnership with a few local companies and which we think would raise our profile in this region’s market,” said Godfrey Somo, Beckers sales and marketing representative for East Africa.
He said being a South Africa exporter of paints and coatings formulation products, “we have been so much disadvantaged because South Africa is not a member of Comesa that allows exemption of taxes on our imports. So our products are fairly high priced to cater for the import taxes.”
“Discussions are ongoing to have South Africa admitted as a member of Comesa and we think if this happens then it would boost our position in the East African market although we are slowly shifting to provision of technical services as opposed to importation and sale of products,” he said.
“Our focus now is to get a few partners in East Africa who would handle the export/import part of the partnership as Becker uses its more than 150 years’ experience to scale up technical services in the paints and coatings industry related segment,” said Somo.
Germany-based dispersion systems manufacturer Vma Getzmann GbmH looks to exploit its reputation as a supplier of quality equipment for the paints and coatings industry to sustain its market share in Africa despite some competition from competitors especially from Asia.
“Our brand is associated with quality and we intend to sustain the reputation by supplying high quality innovative equipment and strengthening the relationship with existing users of our products,” said Mathias Lehnert, the company’s sales director for Africa.
VMA, which manufactures Dispermat and Torusmill that the company says “are highly efficient dissolvers, beadmills and basket mills” hopes to sustain its market position by offering not only latest technology equipment but also quality after sales service.
“Some of our competitors have supplied equipment that breaks down in under one year and this has been an advantage to VMA because our products have a life span of more than 25 years and we are promising customers they will need servicing of the equipment at least after three years,” said David Karanja, managing director of Crane Consulting House, that has partnered with VMA in Kenya.
Subsequent EACC events will henceforth be held after every two years according to Kieran Proverbs dmg events marketing manager. “Our next EACC will be held in 2019,” said Proverbs.
