Paint sales outperform the UK economy for a second year
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1 CUBE January (0) Paint sales outperform the UK economy for a second year Latest figures from the British Coatings Federation show that for the second consecutive year, paint sales have outperformed GDP, with an increase of 5% in volume during 2014, against economic growth of 3%. We ve seen excellent growth in the trade paint sector, which experienced near double-digit growth, due to the combined effect of general economic recovery, and the growth in new house building, commented Tom Bowtell, Chief Executive of the BCF. Woodcare products also had a very good year, with double-digit growth, helped in part by the much better weather last year compared to Industrial coatings sales have been disappointing with more or less flat sales, with a decline in commercial and infrastructure projects. Similarly, wallcoverings and printing inks have also struggled, although towards the end of 2014 volumes saw some improvement, stimulated by growth in packaging inks and wallcoverings exports. CONTENTS BASF s European production and competence centre for flooring and waterproofing systems starts operations 2 Michelman acquires long-time Indian sales partner Supack International 3 OMNOVA introduces PLIOTEC HDT 12 in North & Latin American Market 3 PPG announces all-new brand to better serve dealers and paint professionals 5 American OEM selects Valspar Wood for new Tennessee Flooring Line 5 Axalta receives multi-site ISO certification for manufacturing facilities 6 A PROFILE OF THE EASTERN EUROPEAN PAINT INDUSTRY
2 Looking to 2015, nine out of ten British Coatings Federation members are optimistic about sales and growth, forecasting an increase in number of employees, capital investment, sales value and gross margin. The industry is in a really buoyant mood after the generally excellent year for paint sales in 2014, and it is encouraging to see such high levels of optimism as we head into a new year, concluded Bowtell. Source: BCF, 20 January BASF Since January 2015, BASF s new European competence centre for flooring and waterproofing systems at Oldenburg, Germany, has been fully operational. Manufacture of the Masters Builders Solutions products has been relocated from Schaffhausen, Switzerland. This relocation was the key step in the continuing development of business following the sale of the CONICA Sports Surfaces business and the Schaffhausen, Switzerland, facility in July Besides Production, Customer Order Management, Sales, Marketing, Product Management, and Research and Development departments are now located at Oldenburg, which has proven to be the right choice due to its location in the EU, the good infrastructure, and the competence of its employees. Our new centre underlines our commitment to sustainable, long-term expansion for our flooring and waterproofing system segments. In addition, we are reinforcing our position as a reliable, innovative partner to our customers and providing support for them through individual solutions, says Philipp Kley, Senior Vice President of the Construction Chemicals Europe Business Unit. Oldenburg is very well positioned thanks to the technical competence and experience of its employees and its infrastructure, completes Mark Paßkowski, Oldenburg site manager. The relocation of production equipment from Schaffhausen to Oldenburg took place in two stages to minimise negative impact on production operations. BASF has invested in logistics, facilities, production equipment, research and development. The added roll out of the tinting hubs (machines to colour the floor systems) in Europe, increases flexibility, brings supply efficiency close to the customer and will improve the professional service significantly. Source: BASF, 26 January 2
3 Michelman Michelman has acquired its long-time sales and service partner, Supack International P/L, making it an integral part of Michelman India. Michelman India is dedicated to the development of the Indian market, with an immediate focus on the growing printing and packaging sector. The company also has expansion plans to service other coatings and manufacturing industries that Michelman supports worldwide. Appointed as Co-Directors of Michelman India are Mr. Pankaj Shah, Supack s founder, and Mr. Steven Wong, Michelman s VP/Managing Director, Asia Pacific. With the Supack acquisition, the Mumbai, India-based Michelman India hosts a business centre, laboratory, and an experienced team of sales, technical service and business operations personnel. By keeping the existing team intact, customers will experience a seamless continuation of business and technical services. The facility s laboratory has been equipped recently with several industry accepted product testing capabilities for packaging, printing, and coating applications. With this direct and increased physical presence in India, customers can expect Michelman to quickly develop innovative technologies for the Indian market. According to Mr. Jeff Rodgers, Chief Financial Officer at Michelman, Michelman and Supack have been serving the Indian market together for more than 30 years. Mr. Shah s experience and stellar reputation have allowed us to establish a firm position in the Indian packaging industry. With this acquisition, coupled with our established laboratory capabilities, we will be intensifying our resource commitment to the region to support current customers, while also increasing our focus on serving customers of our Coatings and Industrial Manufacturing Groups. Source: Michelman, 28 January OMNOVA Solutions OMNOVA Solutions has announced the North American and Latin American introduction of PLIOTEC HDT 12 resin specifically designed for the formulation of waterborne, high-gloss, anti-corrosion direct-to-metal (DTM) coatings. Already available in Europe, PLIOTEC HDT 12 provides superior adhesion to ferrous and non-ferrous metals and excellent water resistance properties. Globally, there is an increasing demand for waterborne DTM products to replace solventborne coatings. The challenge is 3
4 making it work effectively without the use of anti-corrosion pigments, which may have negative environmental impacts, Rick Sandford, General Manager of OMNOVA s global Coating Specialties business. PLIOTEC HDT 12 resin uses our new, proprietary polymer architecture to deliver breakthrough performance in corrosion protection. OMNOVA s new Hydrophobic Dispersion Technology is an advanced polymer architecture designed to create a barrier to water, balancing low permeability with other critical properties such as flexibility, gloss and colour retention, and adhesion. Hydrophobic Dispersion Technology is how PLIOTEC HDT 12 achieves superior waterborne DTM performance, said Rich Stewart, OMNOVA Solutions Coating Resins Market Manager for the Americas. We re excited to offer this capability to our customers in North American and Latin American markets. PLIOTEC HDT 12 already has achieved significant commercial success in Europe with OMNOVA customers. residential, commercial, and light industrial applications. OMNOVA Solutions is a technology-based company with 2013 sales of US$1 billion and a global workforce of approximately 2,300. OMNOVA is an innovator of emulsion polymers, speciality chemicals, and functional and decorative surfaces for a variety of commercial, industrial and residential end uses. The company is headquartered in Beachwood, Ohio, USA, and serves a global marketplace from 10 chemical production facilities in Europe, Asia and the US. The business has representative offices in Europe, Asia and the Americas and an extensive network of distributors and agents strategically located around the world. Source: OMNOVA Solutions, 21 January In addition to being APE-free (alkylphenol ethoxylate free) and not requiring anticorrosion pigments, PLIOTEC HDT 12 has other environmentally preferred benefits including no added formaldehyde, low demand for coalescing solvents, and low levels of VOCs (Volatile Organic Compounds). PLIOTEC HDT 12 is recommended for waterborne DTM paints and primers used on metal and wrought iron, metal sidings, and other architectural features in 4
5 PPG Two legendary brands have now, officially, become one great paint. In an ongoing effort to better serve its long-valued customer base of independent retailers, PPG Architectural Coatings, a business of PPG Industries, has announced the launch of the all-new PPG PITTSBURGH PAINTS brand, combining the heritage and product excellence of both the PPG Pittsburgh Paints brand and DEVOE Paint. The new PPG Pittsburgh Paints brand will be available exclusively to US-based independent retailers and represents a strong history in quality, durability and performance to contractors, professional painters and homeowners. Uniting the strong equities of the PPG Pittsburgh Paints brand and Devoe Paint into this completely redesigned brand offers a powerful option to dealers who want to support a brand that will be exclusive to the dealer market, said Dori Marks, Senior Marketing Manager, PPG Architectural Coatings. This launch demonstrates our commitment to the independent dealer network, which PPG has supported for more than 100 years, by offering a new level of exclusivity they can offer to the paint professionals and homeowners they serve. The all-new PPG Pittsburgh Paints brand is backed by more than 300 combined years of paint expertise and will incorporate the most popular Devoe Paint sub-brands, such as WONDER-TONES, WEATHER KING and WONDER-PRO lines, into the long-standing heritage of colour leadership, product knowledge and service excellence that comes with the PPG name. The new PPG Pittsburgh Paints brand will no longer be sold at PPG Paints company-owned stores, but sold exclusively at independent, locally-owned paint retailers. With industryleading tools and support, quality products, expert service, and the best colour platform in the industry with THE VOICE OF COLOR programme, the PPG Pittsburgh Paints brand is backed by PPG Industries a leading global coatings manufacturer and meets the needs of all segments, from residential repaint to commercial applications. Source: PPG, 29 January Valspar Valspar, a manufacturer of wood coatings for prefinished flooring, siding, moulding, kitchen cabinets, furniture, and other building products, has began supplying coatings to a new American OEM hardwood-flooring line in Only, Tennessee. The new line is designed to produce 10,000 square feet of hardwood 5
6 flooring per hour and delivers the flexibility to switch out finish colours in less than 10 minutes. Our goal with American OEM was to evaluate and implement improvements that optimise production for maximum up-time, precision, and performance, said Jim Hazen, Global Technical Director for Valspar Wood. This operation is geared for high-volume and high-style production and quick colour change-outs on a variety of substrates and finishes. As a first step in that evaluation process, Valspar Wood's application engineers conducted line productivity surveys and mapped line configurations and equipment based on desired production processes. Part of that process includes analyses of line speed, temperatures, calibration, cure parameters, coatings formulas, and colour integrity, among other elements required for optimum production. The Valspar Wood team of application engineers, technicians, colour formulators, and coatings chemists, reported findings and recommendations back to American OEM management to improve throughput, efficiencies and cost control. From this exercise a standard operating procedure was implemented. Although American OEM is a new company our manufacturing team has worked together for many years, said American OEM Chief Executive Officer Don Finkell. We've worked with Valspar for more than 25 years so naturally they are an important part of our operation. The American OEM operation uses specialised colour mixing equipment that, when combined with advanced knowledge and expertise, consistently replicates colours that are 99.9 percent accurate. Equally important, the colour equipment promotes sustainability because it greatly reduces tint and chemical waste involved in colour formulation and reproduction, in many cases eliminating waste completely. Finkell continued, Valspar came in, evaluated our lines and went to work, he said. They surveyed the current line speeds and finish parameters and immediately began working with and training our employees. Valspar's support was instrumental in getting our operation up and running. Source: Valspar, 23 January Axalta Manufacturing centres of Axalta Coating Systems have received certification of conformance with the requirements of the ISO 14001:2004 standard. The certification has been accredited by Lloyd s Register LRQA and is valid for three years. The certification applies to all 34 of Axalta s majority-owned 6
7 manufacturing facilities that produce liquid and powder coatings. We are very proud to receive ISO certification again and be recognised for our global efforts to maintain and continually improve our multi-site Environmental Management System (EMS), said Peter Hurd, Axalta Senior Vice President for Operations. Our renewed certification is a testament to the effort, dedication and know-how of the people of Axalta across the globe. Their diligence and capabilities help protect our assets, our employees and the communities in which we operate. ISO certification provides assurance to employees, customers and corporate partners, as well as to the general public and regulatory agencies, that companies adopt a systematic approach to environmental responsibility. The ISO programme enables organisations to measure the environmental impact of their activities, to set environmental objectives, and to implement assessment and reporting processes to ensure environmental performance is continually improved. In order to be recertified as compliant with ISO requirements, Axalta underwent a demanding evaluation process in 2014 that included third-party audits at 11 of its 34 manufacturing facilities. The audits focused on site compliance with the ISO standard as well as compliance with the Axalta global EMS. Each site passed a rigorous evaluation process covering a multitude of procedures, programmes and practices within five criteria: environmental policy, planning, implementation and operation, checking and corrective action, and management review. The recertification process culminated in a comprehensive audit in December, 2014 by LRQA of the Axalta global headquarters, during which the effectiveness of the global EMS was assessed. To maintain certification, LRQA will continue to perform semi-annual audits of Axalta s headquarters and a representative sampling of certified sites to ensure compliance and to assess initiatives for continued improvement. Axalta s customers can be confident that Axalta will continue to provide the high quality products and services they have come to expect well into the future. Source: Axalta, 23 January 7
8 NEW FROM IRL A PROFILE OF THE EASTERN EUROPEAN PAINT INDUSTRY IRL is pleased to announce the launch of a new edition of its regional title A Profile of the Eastern European Paint Industry. This fully updated report provides market data for 2013 and forecasts for 2018, and gives an overview of the paint industry trends across 10 countries in the region. The total market for paints and coatings in Eastern Europe was over 2.8 million tonnes in 2013, and is forecast to rise to more than 3.3 million tonnes by This is equivalent to an average annual growth rate of 2.7%. On a country-by-country basis, Russia is by far the largest national market, accounting for approximately 54% of total demand. The Russian paints and coatings market is forecast to grow at a modest rate due to the slowdown of the Russian economy caused by a drop in oil prices, high interest rates and Western sanctions. The second largest paint market of Turkey will enjoy the highest growth rate over the next few years, underpinned by increasing domestic demand for locally-manufactured goods and increasing income of the Turkish population. Eastern European Paints & Coatings Market million tonnes 0.5% 0.5% ARMENIA 0.5% 0.6% BELARUS 3.7% 0.8% 0.5% ESTONIA 8.1% GEORGIA LATVIA 30.5% LITHUANIA 54.3% MOLDOVA RUSSIA TURKEY UKRAINE Architectural and decorative coatings for consumer and professional uses account for around 59% of the total market, although this proportion varies from country to country. Growth is forecast to be the highest in the industrial wood and powder coatings segments. The growth in the demand for industrial wood coatings is influenced by the dominant market of Turkey, the furniture production of which is currently booming due to high domestic and international demand for Turkish-made furniture. The most attractive opportunities for the supply of powder coatings to the East European region exist, predictably, in Russia and Turkey, where the demand for them is, firstly, driven by their product advantages over their liquid analogues. 8
9 Eastern European Paints & Coatings Market million tonnes 0.9% Architectural 3.4% 1.5% Automotive OEM 6.6% 7.8% Automotive Refinish 16.4% 59.2% General Industrial Industrial Wood 1.4% 2.8% Marine Plastic Coatings Powder Protective A Profile of the Eastern European Paint Industry gives an insight into the market changes in the past few years, as well as outlining the key trends affecting the decorative and industrial coatings segments for each individual country covered. For more information on this and our other reports, please contact Cathy Galbraith at: cgalbraith@brggroup.com Coating Update by (CUBE) is a free weekly news digest of the latest business news and events in the global paints and coatings industry, and is published in-house by specialist coatings research company IRL. Subscriptions: If you or your colleagues would like to subscribe to CUBE, please send an along with your name, position and company to cube@brggroup.com with SUBSCRIBE written in the subject field. Please add news@brggroup-chems.com to your safe senders list. If you no longer wish to receive CUBE, please send a blank to cube@brggroup.com with UNSUBSCRIBE written in the subject field. Enquiries: For enquiries or feedback to the Editor of CUBE (Mrs. Katie Tofts), please send an to cube@brggroup.com. Please also send your press releases to this address. For enquiries regarding other services that IRL can provide please irl@brggroup.com detailing your request. CUBE IRL
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