The container market has become a new pedal for water-based coatings

In 2017, China produced 257,000 tons of container paint. The entire container industry has reduced THE by 120,000 tons, which is an amazing achievement considering that the entire industry releases 150,000 tons of VOC per year prior to the widespread adoption of water-based formulations. The China Container Industry Association is a trade association led by some of the world's largest container companies
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story begins with the signing of a public commitment.
China Container Industry Association held a signing ceremony for its members in 2016 under the VOCs Self-Regulation Convention, pledging to move the container industry from solvent-based coatings to water-based coatings by April 1, 2017. After the signing of this agreement, if a company's containers are still coated with solvent coating, a fine of 800 yuan will be imposed for each container produced. Its members include China International Shipping Container Corporation (CIMC), which accounts for about 50% of the global container market. Together with another company, they have more than 75% of the world's share.
alone accounts for 95 per cent of the global container market.
, the consequences of commitment are enormous. Millions of dollars have been spent on new coating lines to use water-based coatings.
top-down approach usually makes things easier in China, but it shows great results. Previously, 40% of solvent-based container coatings were organic solvents. In addition, about 20% organic thinners need to be added during the coloring process. It is estimated that the VOC release of standard dry containers can be reduced from 36kg/TEU to 5-8kg/TEU, equivalent to an 80% reduction in VOC, after the container company has applied water-based coatings to the paint line.
is China's first commitment to industry self-regulation, water-based coatings in a short period of time to occupy the single market provides a good opportunity. Water-based coatings companies have taken advantage of this opportunity to expand their market share. The development of container coatings market has led to the all-round development of China's industrial coatings market. Water-based and high-solid coatings have developed rapidly in both years.
changes in the upstream container coatings market
companies in the downstream market can often make requests to upstream suppliers. This request is usually well heard. In Western countries, this is known as extended producer responsibility (EPR). One such example is what is happening in the container industry. This has led to structural changes in the container coatings market.
, 9% to 9% of China's container coatings market has been replaced by water-based coatings companies, which is amazing. Both domestic and foreign coatings are actively involved in this process. The primers of water-based coating systems are usually zinc-rich epoxy or PVDC coatings. Wiesberger is one of the leading producers of Teflon (PVDC) coatings, which are found everywhere in Maersk containers in Dongguan. However, PVDC coatings have not been widely used by other container companies in China. The intermediate and top coatings are epoxy or acrylic coatings. In addition, 80% of the top indoor container wall coatings are water-based acrylic epoxy coatings. In 2017, Domestic container coatings company Dowell Coatings achieved significant business growth. The company's total sales of more than 2 billion yuan, in the water-based container coatings market share of 45%. Unsurprisingly, the company's total sales in 2016 were only about $400 million. In the first quarter of 2018, the Company's sales increased by 300% compared to the same period in 2017.
Dowill is not the only container coatings company in the country to achieve exponential growth. Joint's water-based container coatings have also experienced amazing growth. In the first half of 2018, the company's water-based coatings sales increased by 56.8% year-on-year. Their sales of solvent-based asphalt coatings are down 30% from last year.
, some large paint companies face higher cost pressures. Kansi's water-based coatings business is also growing rapidly in China. In the first quarter of this year, CSCO Kansi's revenue rose 33 per cent year-on-year to HK$516m. This is mainly due to higher sales of container coatings. But a big increase in raw material costs has led to poor gross margins.
, container makers do prefer to pay higher prices for water-based coatings, but rising raw material prices have been eroding the profits of paint companies, a common phenomenon.
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