Powder coating has matured from a relatively unsophisticated metal coating process to arguably the fastest-growing coating technology in the world. Manufacturers around the globe are abandoning conventional wet painting in favor of powder coating, but this change is going largely unnoticed by the financial community. The forces driving powder coating’s popularity are increasing and coatings developers are bringing new products to market that assure this technology will continue to thrive. Industrial coatings aren’t exactly dinner table conversation, most people aren’t aware of the scale and financial impact of a global shift to powder coating as a preferred finishing technique.
Global Powder Coating Market Projections
In 2020, the global powder coating market made about $12B. The United States constitutes about a sixth of the market total. Powder coating is a much newer technology and hasn’t previously been viable for many applications where painting was used in the past. Reports compiled in 2018-2019 show powder coating market growth outpacing wet paint market growth over the next several years. The most impressive projection is that the powder coating market will reach a CAPEX of $20.1 billion by 2027.
Historically, the Chinese market has been relatively isolated from international investors, but much is changing there now, making China virtually impossible for the diversified investor to ignore. Earlier this year, CNBC pointed to signs that Chinese regulators may start easing up on their scrutiny of companies after months of clamping down on tech firms. That Read More
Some reports seem to have missed the potential for dramatic policy shifts in the U.S. due to administrative changes on both the federal and state level. The pressure on manufacturers to switch to environmentally-friendly processes may be significantly underestimated. If these pressures increase, it could likely mean an even bigger gap in growth between powder coating and painting. This gap could be further exaggerated if the United States’ involvement with influential worldwide environmental organizations increases.
What is powder coating? The powder coating process involves the application of a thin layer of fine particles to the surface of an object. These particles are heated and flow together to form a durable, uniform coating over the object’s surface. Powder coating is essentially a replacement for conventional wet painting. It offers numerous benefits that have gone largely unnoticed outside of the manufacturing arena. Lawn furniture, office equipment, heavy machinery, and countless other products have been powder coated for decades without much fanfare. Here’s a more detailed explanation of the process.
Improvement In The Coatings
Probably the biggest improvement in powder coatings in the past few years is the refinement of specialty coatings. The advent of anti-microbial and graffiti-resistant powder finishes has expanded the powder coating market, as have powder coating products for high temperature applications. There has also been a huge increase in the number of standard colors and finishes offered by the major suppliers of powder coating media. The ability to accurately match a desired color and texture has opened the door to applications that were previously dominated by wet painting processes.
Coatings industry expert, Bruce Chirrey, explains the appeal of powder coating, “From a financial standpoint, the applied cost of powder coatings is usually less than that of conventional wet paints. Simply put, it can cost a lot less to powder coat something than paint it. Parts that have been powder coated also typically have a finish that is longer lasting and more durable. For manual coating operations, the equipment operators can be less skilled than wet painters and still achieve acceptable results. These factors make powder coating technology a sound investment. Add in the fact that powder coating is more environmentally-friendly than most painting processes and it’s a no-brainer.”
As “green” technologies have gained tremendous support in recent years, powder coating has gotten an added boost over older painting technologies because powder coating doesn’t emit harmful solvent fumes. Increasingly tight environmental controls have driven many large-scale manufacturers to either retrofit their painting lines with powder coating equipment or ditch them entirely and start fresh with powder coating. Although costly, these changes are necessary to help ensure future success.
The Impact Of The Shift
Michael Schuerer, the president of a U.S.-based powder coating equipment company, has seen the impact of this shift to powder coating, “Changing to powder coating offers benefits that aren’t yet fully understood in some manufacturing sectors. It isn’t just about avoiding code compliance hassles; it’s about taking advantage of a technology that increases profits. We have equipment in use by manufacturers that build agricultural products, fencing, architectural components, playground equipment, and consumer products like furniture, sporting goods, and residential lighting. We also supply equipment to technology leaders like Space-X. Sadly, there isn’t much interest in powder coating from outside of the manufacturing and hobbyist communities. The financial opportunities associated with the finishing industry seem to be getting overlooked. You can find manufacturers spending millions on finishing processes in any of hundreds of towns in the U.S. alone. With that much money changing hands, it seems like investors would take notice of the implications of a shift towards a newer, greener, more profitable coating technology.”
If investors or manufacturing businesses are looking for additional revenue streams to serve the urbanizing world, the powder coating industry is rife with opportunities and does not struggle from the supplier bottlenecks that plague other industries.