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January 8, 2018
By: Yogender Singh
India, Asia-Pacific Correspondent
Arapidly growing population with relatively high incomes, huge construction sector and rising demand from industrial segments have led to a steady increase in paint and coatings demand in United Arab Emirates in recent years. The last two years have not brought many cheers for paint and coatings producers in the country due to regional economic slowdown and a lull in the domestic construction sector. But as World Expo 2020 nears, the construction sector has started to gain momentum and paint producers are expecting huge growth in the months ahead. Coatings World presents an overview of the United Arab Emirates paint and coatings industry and major players in this article. United Arab Emirates Paint Industry Overview Valued at about $400 million at the end of 2016, the United Arab Emirates paint and coatings market appears small in total value, but considering the size and population of the country, it is one of the most lucrative paint markets on a per capita basis. Catered by some of the leading multinationals paint companies and a few domestic producers, the paint and coatings industry in the United Arab Emirates has reaped rich dividends from the brisk construction activities and never ending quest of Emirates in making some of the tallest, largest and biggest structures. Most of the notable multinational paint companies operate in UAE through their manufacturing units or stock offices. The UAE’s paint and coatings industry is expected to register steady growth in coming years as the construction industry is poised to witness strong growth in coming years. With more than $34.6 billion (Dh127 billion) worth of urban, industrial, transport, utilities and oil and gas projects in the tender phases, paint producers will have ample opportunities to cash on construction boom in the UAE. Overall, 7,488 building projects worth $228 billion (Dh837 billion) were in concept, design, tender, under construction, and on hold stages at the end of June 2017 according to BNC Network, a construction project database company. Though, given the heavy reliance of UAE’s economy on oil prices, the falling oil prices has had some negative effect on the paint and coatings industry in the UAE in last few years, but the steady construction sector( as mentioned in last paragraph), government’s focus on infrastructure development, huge tourism industry and upcoming Dubai Expo in 2020, which is expected to attract 150 countries for a period of six months are some of the factors which will drive the growth of paints and coating consumption in next two years. Climatic conditions in the UAE present paint and coatings producers with a number of challenges and opportunities. Unforgiving summer weather, with high temperatures of about 100˚ Fahrenheit (about 38-40˚ Celsius), high humidity, salinity of air and regular dust storms for a large part of the year makes it mandatory for paint producers to offer special formulations and high quality of paint products for the consumers in the country. Jotun Norwegian paint major, Jotun has a substantial share in UAE’s architectural and industrial coating market. The company entered in UAE by setting up a manufacturing plant at Dubai in 1973. Jotun operates in all the four major sub-segments – powder coatings, marine coatings, protective coatings and decorative coatings – in the country. Currently, Jotun operates three paints and powder coating production facilities in UAE. The company has provided paints and coating solutions to a number of iconic projects in the country including Burj Khalifa and Masdar City, the world’s first planned sustainable development, located in Abu Dhabi. National Paints Factory National Paints is among the top three paints and coating suppliers in the United Arab Emirates. Starting paint production in Jordan in 1969 and then moving to UAE, the company currently owns 18 factories across the world. National Paints factory in Sharjah is one of the largest production facilities for paints in the entire Middle Eastern region. The company is one of the largest paint producers in the Middle East with total paint production capacity exceeding 200,000 tons/ annum and annual sales of about $200 million. Caparol Paints LLC German company Caparol Paints LLC has been operating in UAE since 1998, when it formed a JV with local company Emmar Industries and Investments. In 2013, Caparol opened a new production plant in Dubai Industrial City, which more than doubled its production capacity enabling it to service the entire GCC region, including Saudi Arabia. Spread over 20,000 square meters the Dubai facility has an installed capacity of 30,000 tons per year with provision for further expansions. The company has supplied coating solutions to some of the most prestigious projects such as The Palm Jumeirah, Sofitel, Burj View Residenve and Reach British School is one of the top paint producers and suppliers in UAE market. AkzoNobel AkzoNobel has been operating in UAE since 2008, when the company opened a powder coatings facility in Jabel Ali (about 35 kms southwest of Dubai) to strengthen its business presence in the important Middle East market. This facility offers a full range of services and products, including color matching, rapid made-to-order products and technical support. In November 2017, AkzoNobel opened its first regional Application Training Center in Dubai, which will enable the company to strengthen customer service standards and promote localized innovation of paint products. Located in Al Quoz, the center houses cutting-edge industry equipment for businesses in wet paint and powder where manual application is applicable. It will focus in particular on OEMs and refinishers in automotive and rail, aerospace and consumer electronics industries. Kansai Middle East LLC Japanese paint major, Kansai started its operations in 2008 in Dubai to serve UAE and MENA. Kansai Paint Middle East – also known as KPME – has an installed capacity of 12 million liters of paint per year. Besides meeting domestic demand, UAE manufacturing serves as the regional hub for warehousing and distribution across 23 countries in the region. The company has recently announced its plan to open about 50 new distribution centers across the UAE, Saudi Arabia and Qatar by 2018. Kansai has refurbished its Umm Suqeim Design Centre and has set up a new paint store in Al Ain in the UAE. The store is part of a pilot phase to be scaled up by 2018 across the region. UAE accounts for 35 percent of Kansai’s business in the Middle East Asia region. Kansai’s share of architectural and industrial coatings business in UAE is 68 % and 32 %, respectively.
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