Demand for epoxy resins set to rise in the USA.

Demand for epoxy resins in North America is forecast to increase nearly 3% per year to 314,000 tonnes valued at $1.4 billion in the year 2004.

The industry is currently in the midst of a major restructuring period, with two of the three US producers of liquid epoxy resins announcing

Ciba Speciality Chemicals entered into an agreement in January 2000 to sell its epoxy resin business to investment firm Morgan Grenfell while Shell Chemical is seeking a buyer for its epoxy resin business, although no deal has been announced yet. As such, the next five years will be marked by integration and restructuring activities on the part of the new owners. These and other trends can be found in Epoxy Resins in North America, a study from The Freedonia Group, a Cleveland, USA-based industrial market research company.

Solid demand in both the Canadian and Mexican markets, as well as ongoing shifts to higher solids, low solvent formulations in both coating and adhesive segments, will partially offset the negative effects of restructuring.

The US will continue to strongly dominate epoxy production in the region, with output benefiting from stable domestic demand as well as solid export markets to Canada, Mexico and a rejuvenated Asia.

With utilisation rates already. high, North American suppliers will need to boost capacity to meet this rising demand.

Coatings will remain the largest outlet for epoxy resins, accounting for over half of total demand in 2004. As reformulation continues, epoxies are finding the bulk of their new applications in powder coatings and other environmentally compliant technologies, such as water-based, radiation-cured coatings and electrodeposition.

Powder coatings, in particular, have been and will be a strong growth market for epoxy resins, particularly for coating metal parts and components used for durables such as motor vehicles and appliances and furniture.