The View from Mexico’s Anafapyt

Mexico’s paint and coatings market is slowly recovering, like the markets in other regional Latin American countries. While the market recovery in both Mexico and the region is expected to continue through 2022, the losses experienced during 2020 leave a difficult job of growing beyond the 2019 baseline totals.

In June, Statista estimated that Mexico’s 2019 paint and coatings sales were down a slight 1% to 48.49 billion Mexican pesos (about $2.4 billion), in comparison to the previous year. Mexico produces about 1 billion liters (about 265 million gallons) of paint and coatings per year.

“After the negative impact on the production of special purpose paints (OEM) in Latin America (of around 25%), Mexico and Brazil, which are the key countries in production, positive figures are estimated for 2021, although this could not be enough to reach 2019 levels,” said Arius Zúñiga, the president of Mexico’s trade association, Anafapyt, and this year president of the regional Latin American trade association, Latinpin.

Anafapyt is the Asociación Nacional de Fabricantes de Pinturas y Tintas. Latinpin is the regional association of the paint and coatings industry, the Federación Latinoamericana de Asociaciones de Técnicos y Fabricantes de Pinturas y Tintas.

Stronger-Than-Expected Recovery in Mexico

Mexico’s GDP is rising faster than expected. Goldman Sachs and Barclays Capital recently raised their predictions based on a somewhat surprisingly strong first quarter, fueled by U.S. demand and the services sector. Goldman Sachs increased its 2021 GDP forecast to 5.9% from 5.3%, while Barclays increased its projection to 6% from 5%.

“The economy will return to pre-pandemic levels in the third quarter of next year,” Marco Oviedo, Barclays’ chief Latin America economist, told Bloomberg in late May.

A much stronger note recently came from Citibanamex, which estimates that Mexican exports could grow by 21.5% in 2021, while private consumption could grow by 4.5% and investment could grow by 5.7%.

Exports turned bullish in April, the latest month reported by the national statistics agency Inegi. Mexico posted a $249 million trade surplus in April on the heels of a trade deficit of nearly $3.4 billion in March, Reuters reports.

Mexico Auto Refinish Market

A key to Mexico’s industrial performance is its auto industry, which serves most of North America. In May, Mexico’s auto production increased by more than 950% to 241,442 vehicles, compared to the year-earlier month, Reuters reports. In the same month-to-month comparison, Mexico auto exports jumped almost 1,500% year-on-year to 242,020 units, the agency says.

Apart from OEM demand for paint and coatings in Mexico, the auto refinishing market there is substantial and has been less affected by COVID than OEM painting activities, Anafapyt indicates.

“The refinishing market remained very active in 2020 and could show growth in some countries such as Brazil, due to the shortage of electronic compounds in the OEM industry,” Zúñiga said.

“In terms of regulatory aspects, the importation of used cars in Latin America is another issue already debated at the United Nations. Chile, Mexico, the Dominican Republic and Guatemala are the main target countries for the import of used cars in Latin America. The concerns of this practice are the polluting and climatic emissions of used vehicles, their quality and safety, energy consumption and the costs to operate them,” Zúñiga notes.

“From 2015 to 2018, those four countries imported around 1.4 million units. Regulatory changes could have a significant impact on air quality and generate business opportunities for these markets,” Zúñiga said.

“For this reason, the development of sustainable solutions will be more and more constant, since companies will play a much more active role in helping to mitigate the effects of climate change. There are already significant efforts in this area, driven above all by transnational companies; however, small and medium-sized businesses are doing their part and we are confident that this will continue to expand,” Zúñiga concluded.

Anafapyt Goes Virtual for 2021 Coatings Show

This year, Anafapyt opted to conduct its annual paint and coatings show, Latin America Coatings Show – LACS, virtually. At press time, 25 presentations and 50 virtual stands were planned.

Among participating companies this year are: Nacional De Servicios Dargue (Naseda); Hero Products Group; Metapol, S.A. De C.V.; Wacker Mexicana, S.A. De C.V.; Ppg Ap Resinas; Oxiteno Mexico, S.A. De C.V.; Leschaco Mexicana S.A. De C.V.; Eastman Chemical Company; Lubrizol Servicios Tecnicos; Allnex; Proinsa Produquimicos Industriales; Tecnoindustries Designs; Kemi Kals S.A. De C.V.; First Quality Chemicals; Clariant Mexico, S.A. De C.V.; Univar De Mexico, S.A. De C.V.; Gtm Chemicals; Latinpin; Lanxess, S.A. De C.V.; Croda; Rodaj, S.A. De C.V.; Evonik; Kigochem, S. De R.L. De C.V.; Kemi Mexico S.A. De C.V.; Basf Mexicana, S.A. De C.V.; Munzing Mexico S.A. De C.V.; 3m Ciencia Aplicada A La Vida.; Polimeros Especiales; Dura International; Stepan; Malvern Panalytical; Brenntag; Siam Usa Llc; and Chromaflo.

The last LACS, in 2019, included 5,750 visitors and 100 exhibitors, according to Anafapyt. The association reported that attendees included representatives from Argentina, Belgium, Brazil, Canada, Chile, China, Colombia, Costa Rica, El Salvador, Germany, Spain, United States, France, Guatemala, Netherlands, India, Korea, Mexico, Peru, Poland, Turkey and Uruguay.

Latinpin Continues Regional Leadership

Latinpin is the regional association of the paint and coatings industry, the Federación Latinoamericana de Asociaciones de Técnicos y Fabricantes de Pinturas y Tintas.

The leadership of Latinpin this year includes president Arius Zúñiga from Anafapyt, Luiz Cornacchioni from Abrafati, and Nicolás Iadisernia from Atipat.

Regional GDP is expected to rise this year, but could dip again in 2022, if COVID case expansion is not contained, the World Bank reported in early June.

“Latin America’s economy will advance by 5.2% this year, above the 3.2% forecast in January. However, its growth will depend on moderate progress in vaccination, the relaxation of restrictive measures and an increase in raw material prices,” the bank said.

At the same time, the bank predicted that the Latin American region’s GDP could decline by 2.9% in 2022.

Latinpin has been working since formation in 2014 to strengthen and standardize the industry. Among initiatives Latinpin is pursuing are content quality, lead elimination, sustainability, and production and sales data collection.

Latinpin members include:

• Argentina: Atipat – Asociación Tecnológica Iberoamericana de Pinturas, Adhesivos y Tintas. Nicolas Iadisernia, president; Adrian Buccini, vice president and director of investment and development; and Ignacio Bersztein, institutional relations.

• Bolivia: ABC – Asociación Boliviana Del Color y La Pintura. Alfonso Claros Uzqueda, president; Nicolas Petit, color specialist.

• Brazil: Abrafati – Asociación Brasileña de Fabricantes de Tintas. Luiz Cornacchioni, executive presidente; Fabio Humberg, institutional relations;  Marcos Basso, technical committee. 

Colombia: Acoplasticos – Asociación Colombiana de Industrias Plásticas. Daniel Mitchell, president, and Claudia Vergara, secretary general. Also, Star – Asociación de Técnicos Andinos en Recubrimientos. Gabriel González, president, and Viviana León, vice president.

Ecuador:  Aseter – Asociación Ecuatoriana de Técnicos en Recubrimientos. Xavier Sanchez, president emeritus.

Mexico: Anafapyt – Asociación Nacional de Fabricantes de Pinturas y Tintas, A.C. Arius Zúñiga, president; and Flor De María González, director general.

Uruguay: Afpia – Asociación De Fabricantes de Pinturas e Industrias Afines. Carlos Barreira, president; Hugo Oxoby, technical manager; and Gabriela Pena, communications manager.