2012/08/21 09:43

Thermal barrier coating in 2012

Establishment of new JIS and hard cost competition

Thermal barrier coating (High solar reflectance coating) market is growing annually by 20% supported by aggressive energy-saving mind. The range of applicable parts is expanding; from roofs to in/out-door panels, glasses and roads. This coating is being used in industrial field and moving to global market too. In July 2011, the corresponding JIS was established. We understand thermal barrier coating would be the first paint which exactly meets social needs. The coating innovation is really expected because it may totally improve energy-saving technology.

Market situation

In 2011, we suddenly faced serious "electricity shortage" issue after tragic incident in Fukushima nuclear power station, therefore, "energy-saving" function of thermal barrier coating became useful promotion tool in terms of utility cost reduction. As a result, the inquiry on thermal barrier coating was surely increased, however, actual sales and growth was same as previous year because of low investment power. However, the growth rate keeps 20% and more than 10,000 tons of high solar reflectance coating is estimated to be sold in 2011.

For the time being, the market could grow and its growth rate would be over 10%. However, leading suppliers have a difficulty in keeping good growth. Replacement ratio by thermal barrier coating is still less than 30%, and most of replacement work is for general roof paint is done through limited existing channels. Potential market will be developed by more product line / sales channel, it means major paint producers who have strong position on roof / architectural paint will be market leader in the future.

Sales strategy influenced by new JIS

We had big event in July 2011; new JIS (JIS K 5675) establishment for high solar reflectance coating for roof. This is the first functional JIS for paint, it define each film performance with standard classification. After that, there are some action made.
Environmental ministry, which manage demonstration project of high solar reflectance coating (listed on "green" purchasing law), announced its performance need to be approved by JIS standard (changed from JPMS). MLIT (Ministry of Land, Infrastructure, Transport and Tourism) started the promotion to use high solar reflectance coating among big cities where have large space of artificial surface. Consortium which acts against heat-island phenomena in OSAKA made original guideline of high solar reflectance coating for roof based on JIS standard, and local government is applying high solar reflectance coating technology into each environmental project.

However, new JIS establishment is never positive for all paint producers. New JIS require the (2-years) exposure test and weathering test on each sample. Acquisition and maintenance of JIS on new product makes huge additional cost. It means more products need much cost. A paint producer said, "It seems difficult for us to make significant profit to cover additional cost for JIS maintenance". As for new JIS, the management of its acquisition and maintenance cost is more important than the way to achieve performance standard. This is a key factor to determine whether keepng market competitiveness or not.

Therefore, paint producers have different strategy. Regarding JIS acquisition, lots of producers tend to make a short list of product for new JIS. JIS defines 4 classes based on the result of accelerated weather resistance test and gross retention test; Class 1, 2, 3 and LG (Low Gross). One producer, who is playing in general market, try to get all-class standard, but the other focus product line effectively in accordance with the balance between additional cost and market needs.

For example as for Class-1, the standard requires 80% gloss retention after 2,500-hr accelerated weather resistance test. In this case, the performance aims basically "Fluorine-resin" level, however, "Silicone-related" product could actually meet the requirement. That may make confusion. Both chemical basis products can be supplied and competed, so, it is concerned the fluorine value may fall and further development of upper silicone grades may be terminated. Although users and constructors finally determine market trend, no producers foresee whether classification-pricing will change the market or current chemical-basis pricing will maintain. We need to monitor market movement carefully.

Recently, urethane paint is growing in thermal barrier coating market. It means this market is getting generalized and cost competitiveness is getting severe. Actually, JIS standard system makes generalized product line, therefore, paint producers face raw material cost issue and need to develop formulation technology.
Thermal barrier coating is now recognized as key industrial material, therefore, paint producers should continue to advance technology innovation to add further value on high solar reflectance coating.