Adhesives and Sealants Market to propel at a CAGR of 5% during the forecast period 2019 to 2025

Adhesives and sealants market is propelled by the growing demands in the packaging, building & construction, and transportation industries; the application in wooden furniture, consumer electronics, and industrial assemblies will witness growth while the market in APAC will be gaining the maximum traction

Adhesives and sealants are used in almost all the industries in various forms such as glues, spray, epoxy, polyurethane, and other types of adhesives. The adhesives and sealants market has been witnessing a substantial demand influx due to the growth of the end-use industries. The building and construction industry is booming with propitious future prospects because the construction activities across the globe are going to catapult in order to fulfill the sustainable development goals (SDGs) by the U.N. The consumer electronics adhesives is also an ever-growing segment of the adhesives and sealants market, because these materials are used to bind semiconductors in mobile phones, laptops, and tablets. Furthermore, the augmented demand for goods from various industries is going to lead to a discernible growth of the industrial sector, and adhesives and sealants are commonplaces in industrial assemblies. The packaging industry is in a transition phase, and paper and board packaging are observing a surge over the years, which is also contributing the expansion in the Adhesives and Sealants Market size. In addition to the industries mentioned above, the demand influx from the transportation industry is one of the major adhesive and sealants market growth drivers. Moreover, the woodworking and furniture industry, which is flourishing in the wake of urbanization is significantly generating an augmented demand for adhesives and sealants. The adhesives and sealants market size was evaluated at $55 billion as of 2018. Furthermore, the demand for adhesives and sealants is poised to grow at a CAGR of 5% during the forecast period 2019-2025.

According to the International Trade Centre (ITC), the trade value of prepared glues and other adhesives was valued to be $13.48 billion in 2018. While the trade was witnessing growth at a CAGR of 4% between 2014 and 2018, the year 2017-2018 observed 7% growth. This is much attributable to demand influx from various end-use industries, and it resonates with the increasing growth adhesives and sealants market size.

The APAC Adhesives and Sealants Market and the Future Prospects for the Players –

Owing to the demand influx from a gamut of end-use industry, the APAC adhesives and sealants market had garnered maximum traction in 2018 as compared to other regions. The APAC adhesives and sealants market share in the global revenues translated to 30% in 2018, and the growth of the market in the region can be further fathomed by the adhesives import data of various countries in the region.

Table 1 – Import Data of the Prepared Glues and Other Adhesives in Major Countries of APAC

Import Data Source – International Trade Centre

From the above figures, it is conspicuous that the highest share-bearer in the APAC adhesives and sealants market is China. While Indonesia adhesives and sealants market is saturated; Thailand, Malaysia, Singapore, and India are some countries that are offering ample opportunities to the players. Here are some of the driving factors that are affecting the APAC adhesives and sealants market –

·         The Building & Construction Industry in APAC Creating Growth Prospects in the Adhesives and Sealants Market –

The construction industry in APAC is the major contributor to the impressive adhesives and sealants market share of the region. The expanse of the construction sector in various countries of APAC can be understood by the industry’s contribution to each country’s GDP.

Table 2 – Contribution of Construction Industry to the GDP

Construction Industry Data Source – World Bank

The construction industry in countries of APAC is a major contributor to their GDP, and this industry is largely supporting the adhesives and sealants market. China and India construction industries are major adhesives and sealants marketplaces, which resonates with the following facts and figures –

Ø  China Construction Industry and Its Impact on the Adhesives and Sealants Market –

The productivity of China construction industry had reached $816.6 billion in 2017, according to the State Council of the Republic of China. Additionally, the industry had witnessed a growth rate of 16.6% in 2017 as per the findings by the National Bureau of Statistics. The upcoming years are poised to foresee an increase in construction activities in China due to the State Council’s issued guidelines on increasing investment in various infrastructures. This will make a huge impact on the APAC adhesives and sealants market revenues.

Ø  Adhesives and Sealants Market Growth Driven By the Booming Indian Construction Industry –

The future for the adhesives and sealants market players in India construction industry will prove to be propitious due to the massive infrastructure investment which is projected to be around $777.73 billion by the end of 2022, as per the findings by the India Brand Equity Foundation (IBEF). 

The construction industry growth in APAC is also attributable to the growing housing demand in countries such as China, India, Indonesia, and others. This is also having a subsequent effect on the furniture and woodworking industry, which is bringing more opportunities to the adhesives and sealants market players.

· The Industrial Growth in APAC Driving the Adhesives and Sealants Market –

The industrial growth in APAC can be understood with the contribution of the manufacturing industry to the GDPs of various countries, which is supporting the market for industrial assembly. Industrial assemblies utilize adhesives and sealants, which makes the manufacturing sector a massive marketplace.

Table 3 – Contribution of Manufacturing Industry to the GDP

Manufacturing Industry Data Source – World Bank

The above table indicates that the manufacturing industry contributes substantially to these emerging economies of APAC. Owing to an enhancement in demand for goods from various industries, the manufacturing industries in these countries will witness growth, which will significantly drive the adhesives and sealants market.

Apart from the aforementioned industries, the F&B, consumer electronics, and transportation industry will aid to the APAC adhesives and sealants market growth. Even though the Japan construction industry observed a slight slump in the last decade, the 2011 earthquake and tsunami in the country has again created a demand for construction, especially housing, and the industry has been picking up pace. It is quite evident in the fact that the construction industry’s contribution to Japan’s GDP has been growing from 26.7% in 2012 to 29.3% in 2016, according to the World Bank. This growth is poised to continue during the forecast period, which will create a sustainable adhesives and sealants marketplace in Japan.

Adhesives and Sealants Market – The Global Scenario and Growth Drivers:

· The Packaging Industry – The Key End-User in the Adhesives and Sealants Market:

The packaging industry is found to be the key end-user in the adhesives and sealants market, and the application in the same will grow at a CAGR of 7% through to 2025. Due to increased e-commerce and augmented logistic activities, the packaging industry is making strides worldwide. The demand influx can further fathom the growth of the packaging industry in the industrial, sustainable, stick, fresh food, smart, and metal packaging markets. Furthermore, the paper and board packaging segment is the most lucrative adhesives and sealants marketplace. As this type of packaging materials has emerged as versatile, they are extensively used in the F&B industry. The paperboard packaging market is thriving as the material is used to store dry, frozen, and fast foods, and they are sealed with the help of adhesives and sealants.

· The Global Construction Industry to Thrive the Adhesives and Sealants Market –

According to the Global Construction Perspectives (GCP) and Oxford Economics, the construction market will breach $8 trillion by the end of 2030, and it will be majorly driven by China, the U.S., and India. Already, the construction industry bears 25.396% of the world’s GDP, according to the World Bank. The upcoming years foresee an increase in construction activities across the globe due to the perpetual industrial development and a perceptible growth in housing needs from the growing population. Furthermore, the construction industry is playing a vital role to fulfill the SDGs by the U.N. The growth of the construction industry will drive the demand for the sealants and adhesives that are used in carpet laying activity, ceramic tile, concrete, countertop lamination, flooring underlayment, and drywall lamination. 

· The Furniture and Wood Working Industry Creating Opportunities in the Adhesives Market –

ITC has assessed the trade in the furniture industry, which was valued to be $86.99 billion in 2018 and had experience 7% year on year growth. A significant part of this trade value is attributable to the trade of wooden furniture. Adhesives are a commonplace in the furniture industry as they are used in the wood binding process. Due to the rise in disposable income in most of the countries in the world, people can afford wood furniture, and therefore, there is an increase in the sales of the same, which is driving the wood adhesives market. 

· Consumer Electronics: A Growing Adhesives Marketplace –

Adhesives are used to bind semiconductors in consumer electronics devices such as mobile phones, tables, and others. According to the Global System for Mobile Communications (GSMA), the total number of mobile subscribers will increase from 5.1 billion in 2018 to 5.8 billion by the end of 2025, which will directly impact the consumer electronics adhesives market. Furthermore, the Semiconductor Industry Association (SIA) that the global semiconductor sales were valued to be $468.8 billion in 2018, and the sales increased by 13.7% in the fiscal year. The industry witnessed a record of 1 trillion units shipped during the year. These semiconductors are used in electronics devices and are bound by adhesives and sealants. The upcoming years will witness further growth in the consumer electronics sector, which will create profitable prospects for the adhesives market players to prosper.

· The Transportation Industry Generating a Demand Influx in the Adhesives and Sealants Market –

According to the European Automobile Manufacturers Association (ACEA), 98.1 million vehicles were manufactured in 2018 worldwide. The upcoming years are poised to witness a revolution in the global automotive industry with the emergence of electric vehicles (E.V.s), semi-autonomous and autonomous vehicles, and self-driving cars and trucks, and this will cause a surge in the valuation of the industry. Now, adhesives and sealants are used in the automotive industry for the bonding of cabin, roof, glass, and side panels. Adhesives are also used in the aerospace and rail transport industry, which are also growing continuously. The expected boom in the transportation sector will create a demand influx in the adhesives market.

Adhesives and Sealants Market: Competitive Landscape

The major players crusading for the adhesives and sealants market shares are Henkel AG & Company, KGaA, The 3M Company, H.B. Fuller Company, and Bostik Company.

· In July 2018, Henkel AG & Company, KGaAs acquired Aislantes Nacionales S.A. to gain traction in the tile adhesives and building materials segment of the adhesives and sealants market.

· In September 2017, H.B. Fuller Company signed an agreement to acquire Royal Adhesives and Sealants, which is a leading manufacturer of high-value specialty adhesives and sealants. The acquisition was $1.575 billion worth and was envisioned to capture the market Royal Adhesives and Sealants, thereby enhancing H.B. Fuller’s adhesives and sealants market share.

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