Chemical City Review: Timing of Epoxy Powder Coating Adjustment

The powder coating industry in China has seen significant growth, with over 2,000 enterprises operating last year. The sector produced more than 400,000 tons of powder coatings, generating sales revenue of 8 billion yuan. This year, production is expected to exceed 500,000 tons, with sales revenue projected to reach 10 billion yuan. Epoxy resins and polyester resins are the two main raw materials used in powder coatings, accounting for over 60% of the total cost. In recent years, rising crude oil prices have led to increased costs for key raw materials such as epichlorohydrin and bisphenol A, which are essential for epoxy resins. Similarly, the prices of polybasic acids and polyols—critical components in polyester resins—have also surged, causing a corresponding increase in resin prices. This rising cost pressure has been passed on to powder coating manufacturers. However, due to intense competition and a fragmented market, many companies have struggled to raise their product prices. Some smaller players have responded by adjusting their formulas, reducing the use of epoxy resins and increasing the proportion of polyester resins to cut costs. Others have adopted non-standard practices, which have not only harmed the industry's reputation but also reduced demand for epoxy resins. Industry experts emphasize that the sector needs to accelerate integration and restructuring to improve efficiency, standardize operations, and meet growing market demands. The goal is to position China as a major global player in both production and consumption of powder coatings. Despite the sharp rise in international oil prices this year, the prices of epoxy and polyester resins remain relatively stable. Production capacity has increased, with large-scale manufacturers operating at full capacity. For example, Bluestar New Material Wuxi’s resin plant produces approximately 3,000 tons per month, offering a favorable environment for the powder coating industry. Experts believe 2005 presents a unique opportunity for China’s powder coating sector. By uniting through an industry association, the sector can combat unregulated low-cost competition, ensure product quality, and gradually raise prices to sustainable levels. This approach will help secure financial stability and drive the industry toward new growth and development.

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