Industrial Coatings Industry Structure Analysis: Are Takeoffs or Jogging in Place?

It is understood that on September 15, 2008, 158-year-old Lehman Brothers filed for bankruptcy, pushing the world overnight to the brink of economic collapse. As a factory in the world, the global economic recession has had an inevitable negative impact on the Chinese economy. And with the export of pillar furniture, toys to hardware and other industries in the past year, shrinking, the paint industry has also experienced a difficult year. According to official statistics, from January to June this year, the total output of paint was 3.77 million tons, which was 7.9% lower than the same period of last year. In Guangdong, a major export province, the paint output has dropped by 15.4%. In the first anniversary of the bankruptcy of Lehman Brothers, where did the Chinese paint industry go?

To analyze the prospects of the paint industry, it is necessary to have an accurate understanding of the industrial structure of Chinese coatings. The Chinese paint industry has two features:

Industrial paint is the mainstay of the industry: Although the biggest news in the coatings industry in the first half of this year was that major paint brands have launched advertising campaigns with great excitement, the real pillar of the Chinese paint industry is the obscure industrial paint industry. According to statistics from January to June this year, architectural coatings accounted for only 29% of the national paint production. Industrial coatings are the main body of the Chinese paint industry, with the proportion reaching 71%.

Concentration of paint production areas: Traditionally, China's paint production is concentrated in the Pearl River Delta, the Yangtze River Delta and the Bohai Triangle. In terms of provinces, the top five paint producing provinces are Guangdong, Jiangsu, Zhejiang, Shandong, and Shanghai. In the first half of this year, the top five paint provinces accounted for 50% of the country's total output. Among them, a province in Guangdong accounted for 17% of the country's output. The concentration of coating production is closely related to the export-oriented economic base of the place of production.

The industrial structure of the Chinese paint industry has caused the coating industry to have uneven levels of investment income for the Chinese government’s RMB 4 trillion investment. The government’s investment in infrastructure has supported the architectural coatings industry, which has resulted in a 3.6% increase in the output of architectural coatings under the financial crisis. At the same time, the industrial coating industry was hit hard by the weak economy of Europe and the United States. In the first half of this year, the output of industrial coatings decreased by 11.8%, of which the total output of the five major coating provinces fell by -17.0%, while the output of industrial coatings in the five major provinces decreased by -18.6%, which was 2.36 times that of the national total output.

The analysis of the coating industry structure shows that the recovery of the paint industry will depend on the recovery of industrial coatings, and the growth of industrial coatings is directly related to the warming of the European and American economies. Interestingly, in the past few weeks, U.S. Washins has received several customers' calls in succession. These customers are located throughout Zhejiang and Guangdong, producing paints that span metal, wood, and plastic coatings, but the content of the telephones is the same: customers are excited to tell us that after a year of silence, they regained foreign business. The order. Customers are eager to find high-quality, high-performance water-based paint materials to meet the requirements of foreign companies for environmentally friendly coatings. If one or two of these examples does not represent a major trend, receiving several such calls at the same time in such a short period of time makes us wonder if the paint industry's ice has started to thaw. Is the recovery of the paint industry in China not far behind us?