The unsaturated polyester resin (UPR) market is estimated at USD 9,655.92 million in 2020 and is expected to register an estimated CAGR of 4.69% over the forecast period (2021-2026).
The automotive industry was affected negatively due to COVID-19. Automotive production has witnessed a significant decline owing to the COVID-19 pandemic. According to OICA, global automobile production declined by around 16% in the year 2020 compared to 2019. This, in turn, has negatively impacted the unsaturated polyester resin market. Many UPR manufacturing companies, as well as raw material manufacturers, have had extended closure of all their operations at their manufacturing locations till receipt of further directions from the government authorities. The relaxation of lockdown and the production at a few manufacturing companies being resumed is an encouraging sign.
- Over the mid-term, major factors driving the global unsaturated polyester resin market are the growing production of glass fiber reinforced plastics (grp) in Europe and the desirable properties of unsaturated polyester resins.
- Advancements in hydro and icephobic property induction methodologies of UPR are expected to provide new opportunities for the market studied.
- The building and construction industry is expected to dominate the global unsaturated polyester resin (UPR) market over the forecast period.
- Asia-Pacific region represents the largest market and is also expected to be the fastest-growing market over the forecast period owing to the increasing consumption from countries such as China, India, and Japan.
Key Market Trends
Building and Construction Industry to Dominate the Market
- UPR is extensively used in the building and construction sector for tiles of roofs, building panels, concrete forming pans, reinforcement, household structures composites, bathroom accessories, etc. Unsaturated polyester resins are used significantly to produce glass fiber Glass Fibre-reinforced Plastic(GRP), which has application in the building and construction industry for flat and corrugated sheets, light domes and skylights, rain gutters, complete covers for sewage water treatment plants, washbasins, shower cabins, dormer windows, and door ornaments. The benefits of GRP, including the freedom of design, high dimensional accuracy of the product as well as the excellent compatibility with other construction materials is also a factor influencing the studied market growth.
- In chemical plants, the construction materials must be able to withstand harsh conditions, such as exposure to water, acids, and solvents, oxidizing media, and changing temperature conditions. There is hardly a material that is better suited for these conditions than glass fiber-reinforced UP resins. New potential applications of GRP include the construction of bridges and concrete repair. The unsaturated polyester resins are also used in the construction of sanitary ware and general waterproofing (pond and water feature linings) and repairs.
- The increase in population levels in China and India may boost the construction industry, thereby indirectly increasing the demand for UPR. The Chinese government has rolled out massive construction plans, including making provisions for the movement of 250 million people to its new megacities, creating a major scope for adhesives, in turn boosting the unsaturated polyester resins consumption over the coming years.
- India is likely to witness an investment of around USD 1.3 trillion in housing over the next seven years by 2027, where the country is likely to witness the construction of 60 million new homes. The availability of affordable housing is expected to rise around 70% by 2024 in India. Besides, the Indian government's 'Housing for All by 2022' is also a major game-changer for the industry.
- According to statistics of the European Union in 2018, about 6 lakh new houses in Sweden and 3 lakh new houses in Germany are to be built by 2025 to meet the population demand, thus, creating a major scope for the consumption of unsaturated polyester resins in multiple end-use applications in the coming years. Such factors depict a positive outlook for the market studied.
- According to the UK-Housing Fit For Nature, about 1.5 million new houses are planned to be constructed by 2022, which, in fact, may increase the demand in the market studied.
- According to the statistics of European Union. a decline of 11.7% of production in construction industry in the month of April 2020 is seen, compared to that of March 2020, this decline is due to the impact of COVID-19.
- However, due to the outbreak of COVID-19, many construction projects have been halted across the world, and the halt has slowed down the demand for unsaturated polyester resin in the construction industry for 2020.
- Therefore, recovery in construction across the world may boost the demand for the UPR used in the construction industry during the forecast period.
Asia-Pacific Region to Dominate the Market
- In Asia-Pacific, China is the largest economy, in terms of GDP. The country witnessed about 6.1% growth in its GDP during 2019, even after the trade disturbance caused due to its trade war with the United States. In 2020, although China was the first country to be affected by COVID-19 and its related lockdown, it was the first country to come out of lockdown, but the country has witnessed recurring cases of coronavirus, which led to further lockdowns. With this, the manufacturing sector was heavily impacted during the year. Moreover, a major chunk of the Chinese economy is linked to foreign exports, where demand is still low due to lockdowns and import restrictions in various countries due to the COVID-19 outbreak. Such a scenario has negatively affected the Chinese industry during 2020.
- China is the world's largest automotive producer. However, since 2018, the country has been witnessing a decline in automotive production. In 2018, the country recorded a decline of 4.16% in vehicle production, followed by 7.5% in 2019 and a further 6.8% decline in 2020. The performance of the automotive industry was affected by the economic shifts and China's trade war with the United States.
- In 2019, the China also recorded a decline of 8.2% in domestic automotive sales. In 2020, COVID-19 had even downsized the demand for the automobiles in China. In addition, automotive demand from international market also declined due to restricted trade to curb the spread of coronavirus. Hence, such factors have negatively impacted the domestic vehicle production in the country during 2020. However, China's automotive market shrank by just 1.9%, as the industry witnessed rise in domestic sales, which was recorded to be about 25.3 million by the end of 2020.
- The construction industry grew at a strong pace in 2019, even though the growth slowed down during the year, compared to 2018. The construction sector has supported the economic growth in the country when ever major slowdown occurred. Demographics in the country is expected to continue to spur the growth in residential construction. Rising household income levels combined with population migrating from rural to urban areas are expected to continue to drive the demand for the residential construction sector in the country. Increased focus on affordable housing by both public and private sector will drive growth in the residential construction sector.
- China is undergoing a process of continuous urbanization, with a target rate of 60% for 2020. The increased living spaces required in the urban areas resulting from urbanization and the desire of middle-class urban residents to improve their living conditions may have a profound effect on the housing market, and thereby, increase the residential construction in the country, which, in turn, will have a positive effect on the unsaturated polyester resins market in the country.
- China has the world's largest electronics production base, and it offers a tough competition to the existing upstream producers, such as South Korea, Singapore, and Taiwan. With the increase in the disposable incomes of the middle-class population, the demand for electronic products is projected to increase steadily in the future, thereby, driving the market studied. The electronics manufacturing industry is constantly expanding in China, as a result of low cost and increasing demand for electronics products. With the increase in the disposable income of the middle-class population, the demand for electronic products is projected to grow in the near future.
- All the abovementioned factors, in turn, are expected to show significant impact on the market in the coming years.
The global unsaturated polyester resin (UPR) market is fragmented, with the presence of both multinational and domestic players. The top 4-5 players account for a noticeable share of the region's market demand. Some of the major companies in the market include AOC, Reichhold LLC, INEOS, Scott Bader Company Ltd., Xinyang Technology Group, and Interplastic Corporation, among others.
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